Petronas joins IPC in southern Sudan

Mar 11, 1997 01:00 AM

International Petroleum Corporation (IPC) has announced that Malaysian Petronas has agreed to acquire a 30 % interest in the Exploration and Production Sharing Agreement ("EPSA") covering Block 5A in southern Sudan, effective as of February 6, 1997.IPC is the operator of the joint venture. Under the terms of the EPSA, IPC and Petronas will jointly assign a 5 % interest in the EPSA to state- owned Sudapet, resulting in IPC retaining a 66.5 % interest and Petronas retaining a 28.5 % interest.
In a related development, The Minister of Energy and Mining of Sudan, in a statement made on March 1, 1997, announced the signing of a Crude Oil Pipeline Agreement and Lease Agreement with Petronas, CNPC, State Oil and Sudapet (the contractors of Blocks 1, 2 and 4) for the construction and operation of an export pipeline. The pipeline will transport up to 250,000 bpd of oil to an oil export terminal which is to be constructed on the Red Sea coast, south of Port Sudan, prior to the end of 1999. A significant portion of the pipeline's export capacity will be reserved for third party users such as IPC, thus providing an incentive for production sharing agreements in other areas in the vicinity. IPC believes that this is an important step towards the development of any discovery in the Muglad Basin.
Block 5A covers an area of 29,412 sq km and is situated in the Muglad Basin Complex in central south-western Sudan, where the majority of the reserves in the country have been discovered to date. The block is located just 30 kilometres to the east and south-east of the Unity Field and is on trend with the Heglig Field and the El Nar, El Tor and Toma South discoveries with total reserves in these fields exceeding 600 mmb of oil. A total of over 80 wells have been drilled in this large basin with an average success ratio of almost 60 %, demonstrating the potential of the remaining undrilled areas. IPC has commenced reprocessing of 3,000 kilometres of existing seismic data on Block 5A and a program for the acquisition of new seismic data will be commencing shortly.

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