More than ever before, the oil and gas sector in North Africa is showing signs of an extremely promising future, and Canadian companies have been among the global leaders in recognizing this potential.
While the signature in June 2000 of a major contract by First Calgary Petroleum confirmed the vast potential of the Algerian market, the King of Morocco announced on August 20 the discovery of major oil and gas deposits in the eastern part of the Kingdom, an area believed until now to have few reserves.
Following negotiations that lasted three years and meetings during Algerian President Bouteflika's visit to Canada in May and the World Petroleum Congress in Calgary in June, Algeria's national oil and gas corporation, Sonatrach, and First Calgary Petroleum signed a contract on June 25 in Algiers to explore and develop Block 406a of the Rhourde Yacoub site in the Berkine basin, reports CANADEXPORT newsletter.
The contract, which is to involve a joint venture, covers a 970-square kilometer area. Approximately 3 billion barrels of oil have already been discovered within a 25 km radius around Block 406a. The agreement will extend over five years, including an initial three-year period during which 2D and 3D seismic data will be gathered and two exploration wells drilled. The total investment is estimated at $31 million, including $18 million for the first three years.
CANADEXPORT adds that Morocco, with largely unexplored territory and few known reserves, remains extremely dependent on the outside world to meet its energy needs. In an effort to decrease this reliance and strengthen the sector nationally, the Moroccan government recently adopted a new legislative framework that is particularly favourable to foreigner operators. This framework provides for generous tax breaks and limitations on the government's role in this sector.
For Canadian and other international energy companies, the Moroccan market possesses vast potential and should not be overlooked. –(Albawaba-MEBG)
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