Political unrest in Sudan could hit OVL investment
Unrest in Sudan has cast a shadow over exploration blocks5A and 5B where ONGC Videsh has a significant stake.
Details of aWork Programme and Budget (WPB) seen by this report show concern at the uncertainties of peace initiatives and an exploration work programme conditional on pending peace initiatives in Sudan. Despite this, work at the two blocks is proceeding apace.
We understand operator Petronas of Malaysia has set aside a budget of $291.58m for 5A (including $26.5m for contingency operations) and $1.08m for block 5B. OVLs share of this expenditure, including Sudapets carry, is $80.02m for 5A and $0.30m for 5B.
Security concerns are uppermost on the minds of the consortium. The contingent WPB is developed on the assumption that, pending security conditions, Petronas will decide if the ambitious exploration programme can be started, we learn.
Three significant discoveries have already been made at Block 5A: Thar Jath, Jarayan and Mala. With some luck the aggressive work programme - split into firm and contingent components - will uncover more.
The firm work programme will see development of the Thar Jath field and 10 exploration wells: TJ 6,7,8,9,10,11,12,13,14 and 15. The contingent programme - dependent entirely on peace initiatives in Sudan involves one appraisal well (Mala-2) three exploration wells (11,V and M), 3D seismic over the Mala field and, if there are successful discoveries, a 2D infill and regional seismic programme and acquisition of high resolution Aero-Magnetic data over the western Flak of the Muglad Basin.
On 12th May this year, OVL spent $136m for 26.12% of 5A and 24.5% of 5B from OMV of Austria. Petronas holds 68.87% of 5A and Sudapet holds 5%.
At 5B, Petronas holds 41%, and Lundin Petroleum of Sweden holds 24.5%. Sudapet holds 10% of 5B.