Petronas plans to pump US$2b into Ethiopian gasfields

Sept 14, 2006 (KUALA LUMPUR) — National oil corporation Petroliam Nasional Bhd (Petronas) plans to invest about US$1.9 billion (RM6.97 billion) to develop the Calub and Hilala gasfields in Ogaden basin, Ethiopia.

Petronas won the gasfield development tender, according to an online newsreport posted on a website.

However, a Petronas spokesman, when contacted, said there has yet to be any firm decision by the Ethiopian Government to award a contract to Petronas to develop the Calub and Hilala gasfields.

According to the report, officials from the Ethiopian Ministry of Mines and Energy and Petronas met in Addis Ababa last week to deliberate and present proposals for the Calub and Hilala gasfield project.

But Petronas is said to be unhappy with the proposal from the Ethiopian Government, particularly on the royalty fee and income tax.

The two parties will have another meeting at the end of this month, according to the report.

In the report, Petronas is said to have proposed to construct a gas pipeline that stretches from the gasfield to a sea port and a natural gas processing plant. The development plan has two phases and is expected to take six years to compete.

According to the plan, in the first three years, Petronas will study how much gas the fields have. It will also work on the design of the pipeline and the gas processing plant as well as conduct a seismic study.

(Business Times)