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Petrobras and Oil Search Limited, which established a joint venture to take on one of the oil exploration fields offered by the Libyan government are going to invest at least US$ 21 million in the exploration phase of the business, forecasted to take around five years.
This information was supplied today (01) by the Brazilian state-owned company. Petrobras was one of the winners of the first Libyan tender for the prospecting of 15 oil and gas exploration areas on Libyan territory. The contract with the Libyan oil company (National Oil Corporation, NOC) will be signed up to the middle of this month.
Despite the consortium signed with Oil Search Limited, which is based in Papua New Guinea, the Brazilian oil company will be the "leader and operator" of the business as it owns 70% of the enterprise, against the associate's 30%.
Investment will also be made in that proportion. The forecasted investment of US$ 21 million is the minimum value. According to Petrobras, in case the prospecting reveals a good production potential, the total invested may rise.
The area acquired by the Brazilian company is "Area 18", which is made up of four blocs totalling an area of 10,307 square kilometers, located in the Mediterranean Sea, on the northwest coast of Libya, and the depths vary from 200 to 700 meters.
Petrobras is internationally renowned for its know-how in oil exploration in deep waters, over 300 meters. Nowadays the company produces oil at depths of up to 1,884 meters. During the tender, Petrobras placed bids for two other areas.
The area the company has won the rights to is considered favorable, as there are "immense fields producing oil and gas, such as Bouri, Al-Jurf and Bahr Essalam, among others," in the area.
Apart from that, according to Petrobras, discoveries of oil and gas have already been made at other blocks in the vicinity that are not yet producing.
In the company's evaluation, such factors are good indicators that "Area 18" may have commercially viable reserves. If this is confirmed, the contract with NOC forecasts a period of 25 years of production, with shared rights with the Libyan state-owned company.
After this agreement is signed, Libya is going to become the fourth African country in which Petrobras is operating. The others are Nigeria, Angola and Tanzania. The agreement also marks the company return to the Arab world, after it interrupted its operations in Iraq in 1980.
ANBA – Brazil-Arab News Agency
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