Sao Tome government confirms existence of oil in area of joint oil exploration with Nigeria

1 December 2011

Sao Tome, Sao Tome and Principe, 1 Dec – The Sao Tome and Principe oil authorities have confirmed the existence of commercial quantities of oil in a block in the exploration area it shares with Nigeria, a Sao Tome representative of joint oil exploration between the two countries said Wednesday in Sao Tome.

Olegário Tiny, director for non-oil resources in the joint exploration zone made the statement before the start of the management meeting between representatives of the joint Nigeria/Sao Tome authority and a delegation of French oil company Total, the operator of block 01 in the joint area.

Citing technical data from surveys of block 01, Tiny said that “everything points to the existence of oil in commercial quantities,” and noted that, “within three years Total may go into actual production.”

The oil official also said that the meeting with Total was intended to establish practical methods of managing the blocks, of which 01 is considered to be quite promising for the authorities of the two countries.

The French oil company acquired block 01 from US counterpart Chevron, which, in its turn, paid the authorities some US$123 million as a fee for the auction that was carried out four years ago in the capital of Sao Tome.

The joint exploration area is based on a treaty signed between Sao Tome and Principe and Nigeria in February 2001, which states that Nigeria receives 60 percent of revenues while 40 percent goes to Sao Tome.

As well as the joint exploration area with Nigeria, Sao Tome also has an exclusive marine area that shows promise for oil exploration. (macauhub)