CNPC, Niger sign upstream, downstream deals
China National Petroleum Corp. (CNPC) has signed a cooperation agreement with Niger to invest $5 billion in exploring and developing the Agadem block.
LOS ANGELES, June 6 -- China National Petroleum Corp. (CNPC) has signed a cooperation agreement with Niger to invest $5 billion in exploring and developing the Agadem block, along with constructing a 2,000-km oil pipeline and a 1-million-tonne/year capacity refinery near the city of Zinder.
CNPC is said to have an "aggressive" exploration program planned, aiming to shoot 4,000 km of 2D seismic in the Diffa region bordering Chad.
About 18 wells also are planned over the next 8 years, of which 11 will be drilled within the next 4years, according to Ye Xiandeng, vice-president of China National Oil & Gas Exploration & Development Corp., the CNPC unit that will carry out the work.
CNPC has not commented on a destination for its planned 2,000-km pipeline, but analysts have suggested Mauritania, Sudan, and Nigeria as possibilities.
CNPC has been active in Niger since November 2003 through a 100% stake in its exploration license for Block BILMA and an 80% stake in Block Tenere, with the remaining 20% held by TG World Energy Corp., Calgary.
CNPC also provides a range of technical services in the country, including geophysical prospecting and well drilling, while partner TG World Energy's representative in Niamey is Niger's former energy minister, Boukar Mai Manga.
In late 2006, the Niger government rejected an offer by Petronas subsidiary Petronas Carigali Niger Exploration & Production Ltd. (PCNEPL) to build a refinery in the same location.
The Petronas offer was part of its effort to return to the Agadem Block 1 permit, which it operated in a joint venture with ExxonMobil subsidiaries until their license expired earlier that year.
In 2005, the Petronas-ExxonMobil JV announced a discovery on the block that produced test flow rates of 2,540 b/d and had proved oil reserves of 350 million boe (OGJ, Aug 15, 2005).
In a statement, Petronas said the Jaouro-1 exploration well was drilled to 2,462 m TD in the Termit basin, about 1,000 km east of Niger's capital Niamey.
PCNEPL was operator of the Agadem Block 1 and held 50% stake in the project, while the remaining 50% was held by Esso Exploration & Production Niger Inc. and Esso Deutschland GMBH, both subsidiaries of ExxonMobil.
Contact Eric Watkins at firstname.lastname@example.org.