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Sao Tome and Nigeria withdraw three oil blocs from auction [ 2006-04-10 ]



Sao Tome, Sao Tome and Principe, 10 April - Sao Tome and Principe and Nigeria have decided to withdraw three of the nine oil blocs from their joint exploration area from being auctioned off due to a lack of interest in them from companies, the director of Sao Tome’s national oil company (ANP) said Friday.

Speaking to Portuguese news agency Lusa, Luís dos Prazeres said that the lack of interest from the market was due to the fact that the three blocs “are located in very deep waters," which technically requires a very large investment.

The joint authority, which is responsible for the auctioning of the blocs shared by the two countries, thus decided to withdraw them, Prazeres said, adding however that they may yet be auctioned but only, “within six or seven years,” when exploration begins on the remaining six blocs.

"For now the auction process in the joint area has finished," he said.

According to Prazeres, of the six auctioned blocs, only one has been granted a concession, to US company Chevron Texaco, which, in partnership with Exxon-Mobil, had already begun drilling, while three other blocs have production sharing contracts and the two remaining blocs are still awaiting contract signing.

When asked about the amounts netted by the Sao Tome state from the auctions, the ANDP CEO said that bloc 1 netted 49.2 million euros, corresponding to the 40 percent agreed in 2001 with Nigeria, which in turn received 60 percent.

For blocs 2, 3 and 4 Sao Tome expects to garner US$28.6 million, which will likely only be in the public coffers in the middle of April as production sharing contracts were signed only on March 14 and 15.

"As for blocs 5 and 6 they have already been auctioned, but the sharing process will only be concluded within two or three months,” he said. (macauhub)
http://www.macauhub.com.mo/en/news.php?ID=1117