Breakthrough in Angola
The Angola government confirmed recently that Hydro will have a considerable interest and important tasks in the exploration and possible development of the highly promising Block 34 on the Angolan shelf. Hydro will also take over 10 percent of Block 25 in Angola.
:00These awards represent an important step forward in Hydro's strategy of further development in Angola as a core area in Hydro's international oil operations, according to the July issue of Hydro's corporate magazine Profile.
Angolan authorities said in June that the state-owned oil company Sonangol was given operator responsibility for the exploration and development of deep-sea Block 34, with technical assistance from Hydro. Hydro's personnel will be integrated as a part of the Block 34 team in Sonangol to provide technical and operational support for the young Angolan oil company.
This means that Hydro and Sonangol will continue the extensive cooperation program that started in 1998. Through the Management and Technology Transfer program, Hydro has committed itself to transferring and building up Sonangol's expertise so that the company can take on new exploration and development tasks within and outside of Angola independently.
Hydro has also indicated that it is willing to provide agricultural training to help local communities to farm more efficiently.
Sonangol itself has a 20 percent share of Block 34 and Hydro will have 30 percent. The other participants are Phillips Petroleum, Braspetro (the international subsidiary of Petrobras) and Shell. Sonangol sent invitations to bid to around 20 international oil companies last September.
Block 34 is about 150 kilometers northwest of the capital, Luanda, and immediately south of oil-rich Block 17, where Hydro has a 10 percent share. The Girassol field in Block 17 is expected come on stream later this year. Hydro also has 27.5 percent of Block 5 and 10 percent of Block 9, which are in shallow water.
"Hydro's main objective in Angola is to create a profitable operation based on Block 17, Block 34 and the other exploration blocks we are involved in," says Torstein Dale Sjøtveit, who is responsible for Angola in Hydro's Exploration and Production International division. "It is also important to build up an independent, national petroleum company in Angola, in addition to contributing to the provision of better access to water, food and energy in the Luanda area at reasonable prices and within a sustainable economic system."
In mid-July, Hydro signed an agreement with ExxonMobil in which Hydro will take over a 10 percent interest in Block 25 about 400 kilometers southwest of Luanda.
Block 25 is next to Block 24, where Sonangol and ExxonMobil recently confirmed an oil find in the Semba 1 well. The water depth in Block 25 varies between 700 and 2,250 meters.
Hydro regards Block 25 as one of the most promising deep water areas in the Kwanza basin, which is in Angolan waters where few exploration wells have been drilled. A new exploration well is expected to be drilled in the block later this year.
The interests in Block 25 are currently distributed between the operator Agip (40 percent), Sonangol and ExxonMobil (25 percent each) and Hydro (10 percent).