Bloomberg News

Petrobras to Explore Ethiopia for Oil in East African Expansion

October 05, 2012

Petroleo Brasileiro SA (PETR4), Brazil’s state oil company, plans an exploration project in Ethiopia, said the East African country’s ministry of mines.

Ethiopia has suspended preparations for the new exploration licensing round until the end of the year following the death of former Prime Minister Meles Zenawi, according to Ketsela Tadessa, the head of the Petroleum Licensing department at the ministry. The country also plans to set up a national oil company to manage resources, said Minister Sinknesh Ejigu.

“We will be busy reorganizing the blocks and then setting them for companies to come and participate,” she said in an interview in London. Petrobras “also wants to be in the East Africa oil and gas exploration.”

A Petrobras official declined to comment.

Explorers are expanding in East Africa, which, except for Uganda, doesn’t have proved oil reserves. Later this year, Tullow Oil Plc (TLW) plans to start drilling a well in the South Omo Block together with Marathon Oil Corp., the latest entrant in a project in Ethiopia.

Petrobras has also drilled for oil and gas off Tanzania in a partnership with Royal Dutch Shell Plc. (RDSA) It will be the largest explorer by market value in Ethiopia, followed by Marathon and Tullow and smaller companies such as Calvalley Petroleum Inc., Southwest Energy and PetroTrans Co., according to the ministry’s website. The nation holds about 5 trillion cubic feet of gas resources.

To contact the reporter on this story: Eduard Gismatullin in London at egismatullin@bloomberg.net

To contact the editor responsible for this story: Will Kennedy at wkennedy3@bloomberg.net


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