Ethiopia – Chinese firm to explore Ogaden oil

April 29, 2006 (ADDIS ABABA) — The Chinese petroleum company, Zhougyan Petroleum Exploration Bureau (ZPEB), is to start undertaking seismic survey in the Ogaden basin, eastern Ethiopia.

ZPEB is contracted by the Malaysian petroleum company, Petronas, which was awarded the Gambela concession in western Ethiopia and additional three blocks in the Ogaden basin.

According to the Ethiopian Reporter, the Chinese firm conducted seismic survey in the Gambela concession and currently it is drilling the first exploration well (wild cat), which is 3,000-metre deep, in Chikaw locality. Chikaw is located 125 km west of Gambela, the regional capital, and only 78 km away from the Sudanese border.

The total concession of Ogaden basin covers about 93,000 sq km. ZPEB will soon start undertaking the seismic survey in the Genale locality, some 1,200 km east of Addis Ababa.

ZPEB will finalize the drilling in Gambela in June 2006. The Chinese experts will conduct a geological testing in the well to ascertain whether or not there is crude oil in the area. Before the completion of the well, some of these experts will move from Gambela to Ogaden. Petronas awarded ZPEB a 30m-dollar contract that included the task of collecting seismic data from Gambela and drilling exploration wells.

ZPEB conducted the well completion work in the Calub gas field in the Ogaden basin. In 1998 ZPEB was contracted by the Ethiopian government and made eight gas wells in Calub ready for production. The company was paid 5.6 million dollar for the job.

Petronas conducted a petroleum study in the Ogaden basin for two years (2004-2005).

Ogaden, a dry belt that neighbours lawless Somalia, is believed to be lying on large quantities of gas, but further exploration is needed to verify the exact amount and develop the fields.

Last week Ogaden rebels groups warned foreign oil companies against exploring oil and natural gas in the country’s south-eastern region, saying they would not allow it.

(ST/Reporter)