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Monday, April 7, 2014

allAfrica.com: Ethiopia: Pexco Terminates Oil Exploration Project in Somali Region

allAfrica.com: Ethiopia: Pexco Terminates Oil Exploration Project in Somali Region

The Malaysian exploration company, Pexco Explorations (East Africa), recently terminated its oil exploration project that it has been undertaking for the past eight years in the Somali Region of Warder-Geladi and Ferfer localities.
The Kuala Lumpur-based company signed a Petroleum Production Sharing Agreement with the Ministry of Mines on October 18, 2005 to prospect for oil and gas in the region known as the Warder-Galadi-Ferfer blocks. The company signed production sharing and petroleum development agreements that enable it to explore and develop hydrocarbon resources in the concession area covering 29,000 sq. km. in one of the remotest parts of the Somali Region near the Somalia border. Reliable sources told The Reporter that the company decided to terminate the project in July 2013 after its exploration period of eight years reached its final expiration date as per legislation No. 295/1986.
Sources said the company conducted an airborne gravity survey of 5,500 km and a magnetic survey of 3,1000 km in the concession area. The company also conducted a 2D seismic survey on 732 line km. Pexco spent 20 million dollars on the exploration work undertaken in the concession area and identified areas where it could drill first exploration wells. However, the company failed to drill an exploration well before the exploration period expired. "I think they were tied up with other exploration works in South East Asia", sources said. Sources told The Reporter that the executives of Pexco asked the Ministry of Mines to grant it a new exploration license in the same concession. The company submitted the application letter to the Ministry of Mines Petroleum Licensing and Administration Core process last October and is awaiting a response. "The company wants to continue the exploration activity," sources said.
Pexco Exploration (East Africa) N.V is owned by a Malaysian billionaire, Mr. Ananda Krishna. Mr. Ananda is a telecom magnet also known as a philanthropist that contributed to the Live Aid program run by Bob Geldof during the 1984 famine in northern Ethiopia.
Ananda Krishnan owns a holding company based in Kuala Lumpur called Usaha Tegas. The company has three main listed subsidiaries: cell phone operator Maxis; satellite TV and entertainment company Astro All Asia Networks; and Tanjong, which is active in gaming, power generation and property.
Sources said Pexco Exploration had built five elementary schools for communities in its blocks. The elementary schools built are said to be in the Warder, Reko, Badros Dadis, Isgoyes and Merkelif towns and a high school in Geladi town which is now serving as a preparatory school for college. It has also built a health post in Merkeliff village. Sources claim that Pexco has the best community assistance program and engagement with the communities in its exploration blocks.

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