Mozambican government signs oil exploration contract with British companies

1 December 2006

Maputo, Mozambique, 01 Dec – The Mozambican government and three British companies Tuesday signed contracts for prospecting and production of oil near the natural gas reserves at Búzi, Pande and Temane in the Mozambican provinces of Inhambane, Zambézia and Sofala, officials said.

The agreement was signed by the Mozambican minister of Natural Resources, Esperança Bias, and the chairman of the board of Mozambican oil and gas company, ENH, Issufo Abdula, on behalf of the Mozambican government and Lee Russell and David Melman, representing the three concession-holders affiliated to British American Natural Gas.

The memorandum, signed in the city of Beira, capital of Sofala province, aims to concede the prospecting and production of oil in the areas belonging to the Sofala blocs, known as M-10, and the Zambeze blocs.

The work, which will be carried out from the beginning of next year, will also consist of seismic surveys and drilling in a place where oil is presumed to exist.

“In these areas there is great potential for new natural gas strikes, thus there is the possibility of oil,” Bias said.

The Zambeze bloc is a land-based area that covers the provinces of Sofala and Zambézia, in central Mozambique, whilst the Sofala and M-10 blocs correspond to the areas of the provinces of Sofala and a reduced area of Inhambane, in the South of the country.

Bias said that the discovery of new natural gas or oil reserves in those areas, “would contribute to economic development not only in the regions, but in the country in general.” (macauhub)