License Opportunities Draw Interest

World Opens Doors to Exploration

International Roundup:

Licensing Rounds

North Sea

Moon Exploration

Barcelona

APPEX London

While the big news in the upstream world of exploration is the licensing is the new U.K. licensing regime there are other areas attracting the attention of explorers.

Ken White, of I HS Energy which provided the information for the EXPLOER, noted "areas generating strong interest at the moment are ‘new areas’ such as the Sao Tome, Nigeria JDZ following the resolution of certain difficulties, India where the new round follows a number of quality discoveries both on- and offshore, a joint initiative between Algeria and Libya, and West Africa -- Mauritania down to Ghana."

White also said "license opportunities abound in Latin America, but the area is proving frustrating at the moment. Tax and other fiscal issue continue to dominate, economies are suffering (but improved in some cases on one year ago) and state companies may be split and reorganized in both Colombia and Ecuador.

"All has generated a level of uncertainty that is limiting license activity in this part of the world at the moment," he said.

So, what's going to happen next in the world of exploration?

Obviously, no one knows for sure -- but some clues can be found by knowing what acreage is either now or soon will be available for bid.

The following summary regarding available acreage is an excerpt from the International Acreage Inventory, a quarterly supplement to the International Oil Letter published by IHS Energy (www.ihsenergy.com).

AFRICA TOP

Algeria

A licensing round includes 12 packages of 28 blocks in different petroleum basins.

Closing date is November 10.

Angola

Government oil company Sonangol has delineated three ultra-deep water areas totaling 131,700 square kilometers for future licensing rounds.

Water depths exceed 2,500 meters. One area is subject to the settlement of a maritime border dispute with the Republic of Congo.

Angola/Namibia

Direct negotiations available are for the Namibe Basin by both Namcor and Sonangol. Sonangol and Namcor have conducted a joint study to promote the petroleum potential of the Namibe Basin, which straddles the border.

Benin

Two onshore blocks are being offered in the northern part of the Keta Basin. Exploratory wells are yet to be drilled in the acreage.

Cameroon

Exploration acreage and marginal field development opportunities are being offered onshore in the Douala Basin and in the onshore/transitional Rio del Rey Basin. Government entity SNH says data availability includes 1,667 kilometers of 2-D seismic of various vintages as well as data from three wells, two of which had oil and gas shows.

Cote D'Ivoire

State company Petroci has delineated four blocks within an unlicensed 8,890 square kilometers onshore coastal area, presumed to be available for direct, out-of-round negotiations.

Djibouti

Although there is only a Mining Law and no Petroleum Law, the Ministry of Energy and Natural Resources is offering three blocks in the first-ever invitation for petroleum exploration.

WesternGeco plans to acquire speculative/non-proprietary 2-D seismic data in the Gulf of Aden and the southern Red Sea.

Egypt

The recently-created Ganoub El Wadi Holding Petroleum Co. has opened its 2003 Bid Round 1, comprising three blocks in the Nile Valley, Upper Egypt. The three blocks covering a total area of 95,227 square kilometers.

Equatorial Guinea

Two blocks in the Rio Muni Basin are available for direct negotiation.

Eritrea

A total of 20 blocks and part-blocks in the Red Sea Basin remain open for licensing under Production Sharing Agreements. Each full block covers one degree by one degree and comprises a surface area of approximately 11,800 square kilometers.

Ethiopia

Seventeen blocks are offered on a first-come, first-served basis, mainly in the Ogaden Basin in southeast Ethiopia. The ministry is seeking geophysical companies to shoot seismic on the blocks at their own cost, to be recovered through data sales. The offer includes two new tracts that represent the exploration acreage around the Calub gas field.

Gambella Petroleum, the last E&P rightholder in the country, was forced to surrender the 15,356-square-kilometer Gambella block earlier in 2001 after non-payment of the US$5 million bonus.

Kenya

The National Oil Company of Kenya offers 14 blocks for direct negotiations.

Libya/Algeria

Two blocks are being offered for bid by Algerian-Libyan Exploration and Production Company (Alepco), a 50/50 joint venture between Sonatrach and the National Oil Corporation of Libya.

The single Libyan block covers 9,703.22 square kilometers, while the Algerian tract, known as Ghardaia, consist of three blocks covering 8,735 square kilometers. Application deadline is Oct. 20, with awards the same day.

Madagascar

Open acreage, mainly onshore, is offered in the potentially prospective basins of Majunga, Morondava and Ambilobe.

Following the cancellation of the PSCs held by Houston-based Xpronet for blocks Mavony (64,500 square kilometers) and Rivomena (77,500 square kilometers), OMNIS is currently redesigning the acreage into smaller blocks and plans to re-offer these for licensing.

Both blocks are located in the Mozambique Channel and may contain a "significant, untested structural trend in the deep-water portion of the blocks" at water depth of around 2,000 meters (July EXPLORER).

Sao Tome & Principe-Nigeria JDZ

Bidding closes Oct. 18 for nine blocks covering 9,990 square kilometers in the northern portion of the 34,580-square-kilometer joint development zone.

The fiscal regime includes a minimum signature bonus of US$30 million per block.

Senegal

Eleven blocks -- six on the shelf and five in deep waters -- remain open for negotiations.

Petrosen is promoting five onshore blocks in the Senegal Sedimentary Basin. The main objective for the project will be the Paleozoic that remains underexplored in the region.

South Africa

The Petroleum Agency SA has redefined the two east coast Durban Basin blocks into smaller units, which are expected to be offered after a new study undertaken by Jebco is complete.

Uganda

Companies are invited to bid for the three areas covering 16,775 square kilometers in the under-explored Albertine Graben that remain unlicensed.

EURASIA TOP

Kazakhstan

A future offshore bid round is planned in which more than 100 blocks are expected to be offered for exploration and development of the Kazakh sector of the Caspian Sea. The blocks will be offered for direct negotiations according to a timetable. Two types of licenses will be offered: exploration for blocks with little data, and exploration and development for blocks better explored.

Kyrgyzstan

Three of seven blocks first offered in 1997 are still available for direct negotiation. They lie in the East Chu, Aksay and Isyk-Kol’ basins.

The Aksay Basin block holds in-place reserves of over one billion barrels; East Chu has 450 MMbo with 2.7 Bcf of gas, and the Issyk-Kul’ block also has little over one billion barrels of oil.

Russia

"Russia continues to display a considerable list of planned auctions and tenders," according to IHS. "This can be attributed largely to the fact that no round has been completed for almost two years."

• East Siberia -- An auction date is awaited for the Talakanskoye oil/gas field in Sakha Republic (Eastern Siberia). The auction was originally scheduled for last December. Ten companies qualified to pre-bid and are known to have submitted applications. The signature bonus is estimated at more than US$300 million.

Eleven blocks have been approved by the Ministry of Natural Resources of the Russian Federation, but full details of the tender have yet to be issued.

• Timan Pechora -- The original plan was to offer 22 blocks in the Barents Sea between 2002 and 2005 covering 70,600 square kilometers and believed to be holding around 16.1 billion boe.
• Volga Urals -- A total of 49 blocks in the Saratov region have been listed covering a total of 35,000 square kilometers. Also, nine blocks with proven hydrocarbon reserves will be offered through auctions and that exploratory licenses for the remaining 40 can be issued without competition.
• West Siberia -- A bid round comprising 11 blocks in the southern portion of the West Siberian Basin is open through Sept. 19. This tender was originally planned for 2001 but it was delayed by the government due to a total revision of already-issued licenses; it is the first in the country for two years. Auction winners will obtain combined licenses for exploration and production.

Uzbekistan

Seven fields remain available for direct negotiation, requiring investment commitments of US$242 million.

EUROPE TOP

Denmark

The Danish Energy Agency has been assessing the licensing terms and conditions of neighboring countries to see how to make the Danish North Sea more competitive, with a licensing round in early 2004.

In a somewhat contrary move, Parliament is reportedly looking into the system to see how the government can get a larger share.

Greece

The Second International Licensing Round, initially scheduled for 2001, then in late 2002, was postponed again due to the proposed partial privatization of Hellenic Petroleum. Following the rejection of Lukoil’s offer for a 23 percent stake, developments concerning the bid round are not expected until late 2003.

Iceland

Authorities keep an open door for companies that are interested in obtaining non-exclusive licenses for prospecting, and do not, at present, grant exclusive licenses of any kind.

Ireland

Two hundred forty-one blocks divided into four branches are available in the Porcupine Basin at six-monthly intervals between through Oct. 15, 2004.

Norway

The Ministry of Petroleum and Energy announced in May that it is changing the licensing system in order to stimulate exploration in mature parts of the Norwegian continental shelf. Starting in 2004 companies can annually apply for new predefined licenses from Jan. 1 to Oct. 1. The ministry will process the applications and award licenses by the end of the year.

As for the current 2003 licensing round, 143 blocks or parts of blocks have been made available in the North Sea and Haltenbanken. The deadline for the submission of new applications is Oct. 1, with the awards planned for December.

Romania

A fifth national licensing round offering three exploration blocks and a total of 29 oil and gas fields relinquished by Petrom SA and eight gas fields relinquished by Romgaz SA are offered. Bids are due in September.

FAR EAST/PACIFIC RIM TOP

Australia

Closing is Sept. 25 for 35 offshore areas comprising 160,169 square kilometers. The areas are situated in the offshore sectors of five states, with no acreage being offered in either New South Wales or Queensland.

The Carnarvon and Bonaparte basins together account for 18 of the areas on offer; the Otway Basin is omitted from this year's release.

Four state governments have together re-released 23 of the 41 bid-areas originally offered in the 2002 Federal Offshore Acreage Release. Seven of the areas are within the Northern Territory's coastal waters, six in South Australia, eight are located in Western Australia and Tasmania accounts for two.

The closing date for applications is Sept. 25, the same date as for the current 2003 Federal Release.

The Western Australian Department of Industry and Resources has opened up six areas for bidding, four in coastal water areas plus two onshore areas. Applications for the areas have to be submitted by Sept. 18, with each judged on a competitive work program bid basis. The first two years of the stipulated work program must be completed without variation.

China

Bidding rounds have not been the Chinese state companies' preferred form of acreage marketing. Consequently, many international companies familiar with the Chinese procedures have initiated bilateral negotiations for blocks.

CNOOC announced on June 6 it was offering 10 offshore blocks for bids -- four in the East China Sea, three in the Pearl River Mouth Basin (PRMB) and three in the Beibu Gulf.

CNOOC also has opened one area in the South Yellow Sea and another in the PRMB.

Meanwhile, CNOOC indicated it is still accepting applications for the remaining 11 deepwater blocks in the South China Sea that were announced last September, covering 76,000 square kilometers in 300-to-2,000 meters of water and covered by 2-D seismic data.

India

Twenty-four blocks have been offered for competitive bidding -- 12 deepwater, 11 onshore and one shallow water block -- with the licensing round scheduled to close on Sept. 30.

Eleven blocks (six deep water and five onshore) are being offered for the first time, with the remaining 13 blocks being re-offered with new/reprocessed/re-interpreted seismic.

Indonesia

Nine is the latest count on blocks to be offered by Migas at a fourth round in September or October. Reportedly, Migas is also considering opening one more block to the north of Madura due to industry interest. The Natuna block could include acreage formerly disputed between Indonesia and Vietnam due to overlapping boundary claims. A boundary settlement was reported imminent in early July.

Meanwhile, the third round is offering 11 blocks for Production Sharing Contracts (as opposed to the 23 blocks originally planned). Eight blocks are located offshore central and eastern Java, two in the Jambi Province of South Sumatra and one in the Tarakan Basin of northeastern Kalimantan.

New Zealand

The Deepwater Taranaki Basin bid-round of five large blocks covered by 6,200 kilometers of 2-D spec seismic survey shot by TGS Nopec closes on Sept. 30.

The North Taranaki Basin bid-round comprising 17 blocks (nine offshore and eight onshore) closes Oct. 31. The nine offshore blocks cover 12,180 square kilometers. Water depths range from 50-to-200 meters. The area is bound by the Pohokura gas field, currently being considered for development, plus the Tui 1 and Karewa 1 discovery wells.

Philippines

The First Philippine Petroleum Public Contracting Round was held in early August with 46 blocks in the offering. The offering was a significant departure from the country’s previous "first-come, first-served" basis of contract award.

South Korea

South Korea welcomes exploration iniatives in any of its seven open blocks offshore. Not open for foreign participation is a block southeast of the Korean Peninsula, where KNOC's Gorae V gas field has been discovered, South Korea's first commercial discovery estimated to contain 200-300 Bcf of gas.

Up to seven similar structures are said to be located adjacent to the Gorae V.

LATIN AMERICA TOP

Brazil

Thirteen companies are reported to have bought data packages for its upcoming Round 5. The tentative schedule at last report was a deadline for bid offers in August; contract signatures in November.

The ANP indicated it will move to twice yearly bid rounds with the ANP round 6, tentatively scheduled for February and believed by many to be the more attractive round as it may include some of the Petrobras Round 0 acreage.

Chile

State oil company ENAP is looking for partners to rehabilitate 21 of its largest fields.

Colombia

Ecopetrol continues to offer offshore "frontier areas" available for the Association Contact model. Formerly referred to as blocks, companies interested in this open acreage may design their own block outline for areas they are willing to negotiate.

As reported in 2001, the seven mostly adjacent areas could hold reserve potential of up to 28 Tcf of gas and three billion barrels of oil. Interested companies can apply to negotiate block boundaries that will be established according to the program developed for that area.

Cuba

Cubapetroleo continues to offer production sharing contracts for acreage in its sector of the eastern Gulf of Mexico, Yucatan Channel, Caribbean Sea and the western Straits of Florida. The Cuban offshore consists of 112,000 square kilometers divided into 59 blocks, 10 of which are currently contracted.

Falkland Islands

New production licenses on all acreage not already covered by an existing or relinquished production license under the open door system with certain exceptions. Excluded from open door licensing are environmentally sensitive areas, areas within 19 kilometers of the coastlines of the Falkland Islands and the Special Cooperation Area (SCA) with Argentina located southwest of the Falkland Islands.

Within these limits, the applicant is free to determine the size and shape of the area for which it will bid. There is no limit to the number of licenses (each of up to 30 blocks) that can be applied for by an applicant at any time.

Bids are opened on the last working day of each month.

French Guiana

The French Ministere de I'Industrie has an open system for licensing oil and gas rights in French Guiana.

Guyana

All of the acreage on the Guyana side of the onshore Takutu Basin is available for licensing.

Mexico

Pemex has reportedly delayed the official publication of its Multiple Services Contracts (MSC) bid round until after July elections, under the assumption the PRI will regain its majority in congress. If not, PRI could call off the bid round.

Paraguay

All open areas in Paraguay are available for negotiation.

Suriname

Government oil company Staatsolie has outlined an offering of 19 offshore exploration blocks, with the bid round in the third quarter and awards in 2004.

The 2003-04 acreage offer follows an offering seven shallow water blocks that attracted no offers. These same seven blocks are now included in the 19 blocks currently being offered.

Seismic contractor WesternGeco shot approximately 4,500 kilometers of 2-D data and 600 kilometers of OBC data in 2001. The U.S. Geological Survey has estimated an ultimate oil potential of some 15 billion bo in-place. To date, only 170 million bo have been discovered.

Uruguay

Since March 1994, companies have been invited to register and bid for acreage on the last working day of every quarter. To date, no applications have been filed.

Venezuela

PDVSA says it will re-offer two of the three remaining blocks in Plataforma Deltana before the end of 2003. Blocks 3 and 5 will be re-offered with additional acreage in order to increase their exploration potential.

PDVSA is already in negotiations with BP in Block 1 to do a cross-border reservoir study of the Kapok and Dorado fields for future unitization.

Meanwhile, the Venezuela government is talking about future upstream opportunities for private investment in Venezuela's offshore areas of the Atlantic and Caribbean continental shelf, the onshore Maracaibo Basin and in eastern Venezuela. Onshore western Venezuela exploration areas that will be open for private sector development are the Franquera, Horcon, Domo Norte, Domo Sur, Guarani, Sur del Lago and Ceuta-Tomoporo fields.

In the eastern part of the country, development opportunities will include the Capiricual and Pato fields.

MIDDLE EAST TOP

Iran

On March 5, 2003 Petropars confirmed that another eight phases of the South Pars Project would be put to tender during the new Iranian calendar year that started on March 21. The company estimates that another US$8 billion will be spent on the expansion of the South Pars gas field. Ten phases already have been allocated out of 12 offered so far, in a project that currently envisages over 30 phases.

It is estimated that each phase will require an initial investment of US$1 billion. Participation will be made in the form of buy-back agreements.

Jordan

The West and East Safawi blocks, the North and South Sirhan blocks, South Jordan, Northern Highlands, Al Jafr and Azraq blocks are all open to application from foreign companies.

Lebanon

According to Spectrum Energy, which signed a five-year agreement in 2002, the government is preparing an offshore licensing round assistance and for offshore boundary delineation.