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China starts oil drilling in Ethiopia’s Gambella

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Mar 4, 2006 (ADDIS ABABA) — The Chinese petroleum company, Zhonguan Petroleum Exploration Bureau (ZPEB), last week started drilling the first exploration well in the Gambella basin, west Ethiopia.

The Ethiopian Minister of Mines and Energy, (MME), Alemayehu Tegenu, and Abiy Hunegnaw, head of the petroleum operation departmnt with the ministery, last Friday visited the oil exploratin project in the Gambella Basin.

The officials attended the launching of the drilling on the first exploration well (wild cat well) in the region.

ZPEB was contracted by Petronas, the Malaysina Petroleum Company that was given the Gambella concession in 2003, to undertake drilling works.

Petronas and MME signed the petroleum exploration and production sharing agreement that enables the company to explore and develop the oil reserve in the Gambella basin, near the Sudanese border.

The Gambella concession stretches across a 19,600 sq. km of land. The Gambella basin is an extension of the Melut basin, located in south Sudan.

The Melut basin is known for its huge amount of oil reserve. Petronas has been exploring and developing oil fields in the Sudan.

China controls 40 percent of the oil development activity in the Sudan while Malaysia and India each have 30 and 25 percent stakes respectively in the oil industry.

In the past two years, ZPEB, hired by Petronas, has been undertaking seismic survey in the Gabmella basin. Experts of Petronas analyzed the seismic data collected from Gambella and identified the specific areas where some exploration wells would be drilled.

Petronas has allocated 16 million USD to cover the expenses of the drilling on the first well. The drilling rig and other equipment were imported from China.

Senior officials of MME said the drilling would be finalized within three months, adding that oil testing will be conducted in the exploration well.

The officials indicated the depth of the well was not yet known. "We are quite satisfied with the exploration activities of Petronas. And the result of the testing in the first well is very important to decide whether or not to drill more wells," they said.

"Oil show could be discovered or it could be a dry well" they added. Last August Petronas took three concession areas in the Ogaden basin, east Ethiopia.

(The Reporter)

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