Tullow expects Ugandan 'farm-in' oil permissions soon
0 COMMENTS | COMMENT PRINT EMAIL |
By: Reuters
3rd November 2010
TEXT SIZE
Tullow Oil expects Uganda to grant approval soon for the planned sale of some of its assets to France's Total and China's CNOOC, paving the way for a new venture, a Tullow official said on Wednesday.
In Kampala, Ugandan Energy Minister Hilary Onek told Reuters the government expected to sign a memorandum of understanding (MoU) with Tullow in the next three weeks.
"Discussions are still ongoing between us, but in three weeks we should be ready to sign that MoU," Onek told Reuters.
Last month a Ugandan junior minister said Tullow had agreed to pay $400-million in capital gains tax to the Ugandan government, paving the way for the company to renew an oil licence in the east African nation.
"We expect that in the next few weeks we will have final sanction for the farm-in by CNOOC and Total into the licences and the beginning of the new marriage, if you like, a joint venture for the development phase," Tim O'Hanlon, Tullow's vice president Africa business, told Reuters on Wednesday on the sidelines of an African oil conference.
Earlier, he told delegates the new partnership would help meet drilling infrastructure commmitments, estimated to cost about $1000million, at the technically challenging and remote Lake Albert basin.
"That decision we'll now take happily before the end of the year if all goes well," O'Hanlon said.
First oil production was forecast in Q1 of 2012 in a country with oil reserves estimated at upwards of 2.5 billion barrels, with first refined products from a proposed new Ugandan refinery seen in 2014.
"And then the basin will be able to run at its potential of 200,000 bpd... plus an export pipeline from 2015, so that's what our new partnership will be able to bring," O'Hanlon said.
Kampala has been in a long running row with London and Toronto listed Heritage Oil over the refusal by the company to pay capital gains tax from the sale of its half-share stakes in exploration areas 1 and 3A to Tullow.
The government declined to approve the transaction and questioned the validity of one of the licences.
On October 27 the Ugandan junior minister, Simon D'Ujanga, told reporters in India that Tullow had agreed to pay that tax.
Onek said he could not confirm or deny whether the tax dispute had been settled or was still a sticking point.
"My junior colleague has commented on that matter and I don't want to add because I think he's probably updated and has the latest, he can clarify on what he meant," Onek said.
NO EASY FIX FOR CONGO BLOCKS
O'Hanlon said Tullow had been approached to buy back Blocks 1 and 2 on the Democratic Republic of Congo's (DRC) side of Lake Albert, after a presidential decree in Congo stripped it of the rights in June.
The promising blocks, which straddle the border with Uganda, were handed to two foreign companies, Caprikat and Foxwhelp, dismissing an accord Tullow believed it had sealed with the government in 2006.
"They certainly are (looking to sell). As far as I know that is their business plan based on their approaches (not only to) us, but many companies as well," O'Hanlon said.
He said it would be very difficult for Tullow directly to buy the disputed blocks.
OIL
Tullow to start Jubilee oil production by month-end
0 COMMENTS | COMMENT PRINT EMAIL |
By: Jade Davenport
3rd November 2010
TEXT SIZE
Ireland-based independent oil company Tullow Oil said on Wednesday that the development of its flagship project, the 370-million barrel Jubilee Oilfield Phase One off the coast of Ghana, was on schedule and nearing completion.
Tullow Oil vice-president for Africa usiness Tim O'Hanlon told delegates attending Africa Oil Week in Cape Town, that the Jubilee Phase One was on schedule for first oil production by the end of November.
The $3,5-billion project, which was largely on budget, involved the first-phase development of the Jubilee oilfield off the coast of Ghana and included the drilling of 17 wells.
Subsea production installations and the leasing of a floating, production, storage and offtake vessel were expected to deliver a plateau oil rate of 120 000 bbl/d, a water injection capacity of 230 000 bbl/d of water, and a gas export and an injection capacity of up to 160-million standard cubic feet a day.
The project had been fast-tracked to ensure that production would begin before the end of 2010.
O'Hanlan said that production at Jubilee Phase One would be rapidly ramped up and the company expected to produce 120 000 bbl/d within three to six months of first oil.
First cargo from the development was expected in January 2011.
The total reserves of the Jubilee oilfield, which was discovered in 2007, were estimated between 500-million and 700-million barrels of oil. The total resource was estimated to be up to 1,8-billion barrels, making it West Africa's largest offshore deep-water discovery in over a decade.
The Jubliee Oilfield was expected to be developed in several phases and it was anticipated that the second development phase would be sanctioned late next year or early 2012.
O'Hanlon reported that Tullow was also investigating three other targets off the coast of Ghana, including the Tweneboa, Owo, and Oalum oilfields.
O'Hanlon argued that, despite the company's European roots, Tullow could be considered an African success story, owing to the fact that it had interests in 15 African countries and in 18 producing fields, and had a total of 50 licences across the continent.
COMMENTPRINT 
