Libya signs deals with oil majors
Posted: 03 December 2007
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ExxonMobil has signed a new agreement with Libya to explore for oil and gas off the coast of the North African Arab country.
The company signed the deal in late November through its subsidiary ExxonMobil Libya to explore what it called “of the most prospective unlicensed areas offshore“.
Unlike previous exploration contracts which Exxon has won in Libya in the past two years, the latest deal was negotiated directly between the two, outside the auction process, according to a statement by ExxonMobil.
Under the agreement, Exxon has agreed to look for oil and gas in a deep-water area about 110 miles off the Libyan coast in the Mediterranean Sea . It has also agreed to drill at least one well and will pay a bonus to the Libyan government.
Exxon Mobil Libya Limited has committed to a five-year work program consisting of at least 4,000 kilometres of 2D seismic acquisition, 2,000 square-kilometres of 3D seismic, and one deepwater exploration well.
Phil Goss, president and general manager of ExxonMobil Libya Limited said :“We expect to realise substantial technical, operational and cost reduction synergies with ExxonMobil deepwater exploration efforts in the adjacent Contract Area 20.”
Elsewhere in Libya , ExxonMobil has completed an Environmental Impact Assessment and a 2D seismic acquisition program in Contract Area 44 in the offshore Cyrenaica Basin , which was awarded to the company in the second round of EPSA IV licensing in 2005.
In recent months, Britain 's BP and Italy 's Eni have signed hydrocarbon exploration agreements with Libya , and dozens of companies have participated in three rounds of bidding for exploration blocks both offshore and on land.
Exxon already won exploration rights to offshore acreage in the bidding rounds. In early 2007, it won exploration rights to a block adjacent to the block it was awarded by the Libyan government in November.
In another statement later, Occidental Petroleum Corporation announced that it had signed agreements with the National Oil Corporation to upgrade several of its existing petroleum contracts.
“Te new agreements will be consistent with the newly established EPSA IV contractual frame work now utilized in the Libyan oil industry. The term of the new agreements will be 30 years,” Occidental said.
"We expect production from these projects will make a major contribution to NOC meeting its goal of doubling Libya 's oil production to more than 3 million barrels per day in the near future."
The new agreements cover fields with approximately 2.5 billion barrels of recoverable high-quality oil reserves.
Over the next five years, about $5 billion in capital investment is expected to be made to increase gross production to more than 300,000 barrels per day from the current level of around 100,000 barrels per day.
The Austrian oil and gas company, OMV, will join the project with a 25% interest with Oxy retaining a 75% interest.
Oxy and OMV will collectively contribute 50% of the development capital and NOC will contribute the remaining 50%. |
