White Nile to start Sudan drilling by last quarter of 2006
Mar 14, 2006 (NAIROBI) — UK oil explorer White Nile said on Tuesday it expects to begin drilling its first well in southern Sudan by the last quarter of 2006, despite a dispute with France’s Total SA over the same area.
"We anticipate we will drill our first well by Q4 2006," White Nile’s chief operations officer Philip Ward told Reuters on the sidelines of a southern Sudan investment conference in Kenya.
"Within three years we envisage we will be able to pump oil through the ground for local consumption and the international market," he added.
Following the 2005 signing of a peace deal to end more than two decades of war between southern rebels and the Khartoum government, the former rebel Sudan People’s Liberation Movement (SPLM) awarded White Nile a concession to explore for oil.
It was given rights to Block Ba, a 67,000 sq km tract in southern Sudan that forms part of Block B claimed by Total.
The deal, which gave the SPLM 50 percent of White Nile, sent the firm’s shares soaring from 10 pence to 137 pence.
However, its share price sagged after the Khartoum government said the SPLM could not issue such rights and Total threatened legal action to uphold its Khartoum-issued licence over the same area.
"We are of the opinion we have an existing contract with the government of southern Sudan," Ward said.
"Within the industry it is estimated the reserves within Block Ba are between 3-5 billion barrels of oil. It’s the best block in southern Sudan."
He said the firm was still waiting for a ruling by a UK High Court judge over the case.
However, the chairman of Total Exploration & Production Sudan, Nicolas Brunet, said the French oil major expected the issue to be resolved by the Khartoum government and their southern counterparts.
"We hope to start shooting seismic data by the fourth quarter of this year," he told Reuters.
Total was awarded the Block B concession in 1980, but suspended its operations in 1985 because of insecurity. In 2004 Total signed a revised deal with the Khartoum government.
The south’s trade minister Anthony Lino Makana said the dispute was being handled at the "highest level."
"People are searching for an amicable solution to this issue," he told the conference to attract foreign investment in the war-ravaged south.
Across Sudan, up to 500,000 barrels of crude oil is produced every day, mainly from fields in the south where Chinese, Malaysian and Indian companies are the big investors.
Sudan expects to increase output by 150,000 barrels per day this year. Foreign firms hope that peace in the south will allow them to tap into the south’s huge potential oil wealth.
White Nile, which has a concession in Ethiopia, had applied for another one in north east Kenya and was also looking at oil potential in Chad, Uganda and Democratic Republic of Congo, Ward said.
"We’re looking at other concessions in the area because we want to be a regional player," he said.
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- Unpaid Debt A comprehensive overview of the role of the Lundin Consortium in the oil war. ECOS calls upon the Swedish, Austrian and Malaysian governments to investigate whether, as a matter of international law, Lundin, OMV and Petronas 'were complicit in the commission of war crimes and crimes against humanity by others during the period 1997-2003.’ In response, the Swedish Public Prosecutor for International crimes opened a criminal investigation into ‘links between Sweden and the reported crimes’.
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