One of the nightmares for any company working in frontier regions of the developing world is to become trapped in the middle of a territorial dispute between two governments.
That is just what happened to International Petroleum Corp. when it signed an agreement with the Sudanese government last December for two large offshore/onshore concessions in the Red Sea.
IPC was then told by the Egyptian government it claimed the northernmost of the two concessions, the 2.5 million acre Halaib tract. Egyptian General Petroleum Corp. plans to award Red Sea licenses, one of which includes most of the IPC acreage.
IPC confirmed it has been notified by the Egyptian government of its sovereignty claim and tactfully added that the matter has been referred to the Sudanese government.
The dispute could end soon because exploratory talks between the two countries may have reached an undisclosed agreement on how it can be resolved.
WHAT'S PLANNED
IPC is to begin exploration this month.
It will concentrate on the 7 million acre Delta Tokar concession in the southern part of the Sudanese Red Sea adjoining the border with Ethiopia.
About 1,000 km of seismic will be acquired, followed by drilling the first well, possibly before the end of the year. IPC said most of the program will concentrate on Suakin gas/condensate field discovered by Chevron in 1976.
HOW IT STARTED
The roots of the territorial dispute stem from British colonial days. Back in 1899 Britain was instrumental in fixing a political boundary between Egypt and Sudan running along the 22nd parallel.
But an administrative boundary farther north created the Halaib triangle where Sudan was responsible for nomadic tribes that passed through the area. At that stage no thought was given to the Red Sea and the possibility of oil exploration. However, in 1956 Egypt and Sudan signed an agreement that retained Egyptian sovereignty and Sudanese administration. That perpetuated the problem.
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