Mozambique: Russian-Dutch company to support Sasol in prospecting for oil

29 February 2008

Maputo, Mozambique, 29 Feb – The Russian-Dutch joint venture Salym Petroleum Development (SPD) is to plan and manage the drilling of two wells in Sofala bay, central Mozambique, according to the Mozambican press which cited the company’s technical director.

The contract includes four optional perforations and could be the beginning of a longer partnership with South African oil company Sasol, which is the concession-holder.

SPD is a joint venture set up in 1996 between Russia’s Evikhon and oil company Shell to explore oil wells at Salym, discovered in western Siberia in the 1960s.

As the oil in Mozambique is only at the prospecting stage, the doubt remains as to whether pr not there are commercially-viable reserves.

The Mozambican government maintains it is confident of the existence of commercially-viable oil reserves in the country, especially in the Rovuma basin (the river separating Mozambique from Tanzania to the north) and the Zambezi river delta (central Mozambique), but has always said that the final word rests with the prospecting companies.

Recently, US company Anadarko, Italy’s ENI, Norway’s Norsk Hydro and DNO, Malaysia’s Petronas and Canada’s Artuma, won tenders launched by the Mozambican government for oil prospecting in the Rovuma basin.

Preliminary results of a recently published study, carried out by the US’s Rose & associates at the request of Artumas, showed that the Rovuma basin, in Northern Mozambique, has oil potential in sufficient quantity for commercial exploration, but with an 18 percent likelihood of success.

Surveys carried out in 1986 by Esso and in 1998 by Lohnropet showed that there was no oil in the region, but rather gas deposits.

At the same time, the Mozambican government launched in December of last year, the third international tender for oil surveying, this time in the Mozambique basin, over an area of 61,000 square kilometres.

In this area of the country, amongst others, are Brazilian oil company Petrobras which, in partnership with Petronas (Malaysia), is working on hydrocarbon production in the Zambezi delta.

Petronas last year signed a deal with Mozambican state company ENH for exploration of oil and natural gas in Mozambique.

The Malaysian company is expected in the first half of this year to start its second phase of surveys in the Zambezi Delta and plans to drill an offshore well at a cost of US$20 to US$25 million. (macauhub)