Sudan signs new oil exploration deal
Aug 08, 2010
SUDAN on Friday signed a new onshore exploration deal for a 50,000 square kilometre Block E with two European companies, who called for other Western companies to invest in the US-sanctioned oil producer.
KHARTOUM
SUDAN on Friday signed a new onshore exploration deal for a 50,000 square kilometre Block E with two European companies, who called for other Western companies to invest in the US-sanctioned oil producer.
The contract sparks renewed European interest in Sudan’s oil sector, which had looked east to Chinese, Indian and Malaysian companies to extract its almost 500,000 barrels per day as European companies withdrew during a 1983-2005 north-south civil war worried about the implications of rights abuses.
“Come and invest in Sudan, there are many professional people and great opportunities this is our message to all of the European companies,†said Farshad Zandi from the Star Petroleum company, based in Luxembourg which holds a 75% share of the block.
Zandi added the Norwegian Hamla company, which he said was part of AGR Group, would take five percent. Sudan’s two national oil companies, Sudapet and Nilepet, would take the remaining 20%.
Total is the main European presence in Sudan’s oil sector which has conducted minimal work on its block, after legal disputes over the contract. Investors are wary of a looming January southern referendum on independence which most analysts say will result in secession.
Most of Sudan’s oil reserves lie along the still disputed north-south border.
Star Petroleum already operates in the Caspian Sea, Yemen, and Iran and hopes to move into Angola, Zandi told Reuters, adding it had set aside $200m to invest in Sudan.
“We don’t have any information on this block yet but we heard that it’s a very promising block, we know this because around us there was more than 10 million barrels discovered,†Zandi said of neighbouring oil blocks.
Block E traverses four southern states, Northern Bahr el-Ghazal, Western Bahr al-Ghazal, Lakes, Warrap and South Darfur in north Sudan.
Head of exploration at Sudan’s energy ministry, Azhari Abdel Gadir told Reuters they hoped drilling could begin after three years of initial exploration with an investment of $20m.
“The contract will last for 20 years with a potential renewal period of 5 extra years with a six-year exploration period at the beginning,†he said.
“It’s too difficult to talk about potential production or reserves but it is near to Block 5a, so it is expected that a light or medium oil will be found.â€
Sudan produces the sweet Nile Blend from Block 5a and a heavier Dar Blend from its blocks in the Melut Basin. It also produces the highly acidic Fula blend.
Reuters
SUDAN on Friday signed a new onshore exploration deal for a 50,000 square kilometre Block E with two European companies, who called for other Western companies to invest in the US-sanctioned oil producer.
The contract sparks renewed European interest in Sudan’s oil sector, which had looked east to Chinese, Indian and Malaysian companies to extract its almost 500,000 barrels per day as European companies withdrew during a 1983-2005 north-south civil war worried about the implications of rights abuses.
“Come and invest in Sudan, there are many professional people and great opportunities this is our message to all of the European companies,†said Farshad Zandi from the Star Petroleum company, based in Luxembourg which holds a 75% share of the block.
Zandi added the Norwegian Hamla company, which he said was part of AGR Group, would take five percent. Sudan’s two national oil companies, Sudapet and Nilepet, would take the remaining 20%.
Total is the main European presence in Sudan’s oil sector which has conducted minimal work on its block, after legal disputes over the contract. Investors are wary of a looming January southern referendum on independence which most analysts say will result in secession.
Most of Sudan’s oil reserves lie along the still disputed north-south border.
Star Petroleum already operates in the Caspian Sea, Yemen, and Iran and hopes to move into Angola, Zandi told Reuters, adding it had set aside $200m to invest in Sudan.
“We don’t have any information on this block yet but we heard that it’s a very promising block, we know this because around us there was more than 10 million barrels discovered,†Zandi said of neighbouring oil blocks.
Block E traverses four southern states, Northern Bahr el-Ghazal, Western Bahr al-Ghazal, Lakes, Warrap and South Darfur in north Sudan.
Head of exploration at Sudan’s energy ministry, Azhari Abdel Gadir told Reuters they hoped drilling could begin after three years of initial exploration with an investment of $20m.
“The contract will last for 20 years with a potential renewal period of 5 extra years with a six-year exploration period at the beginning,†he said.
“It’s too difficult to talk about potential production or reserves but it is near to Block 5a, so it is expected that a light or medium oil will be found.â€
Sudan produces the sweet Nile Blend from Block 5a and a heavier Dar Blend from its blocks in the Melut Basin. It also produces the highly acidic Fula blend.
Reuters