Mauritania disputes offshore PSCs

Australian companies have been advised by the Mauritanian government that it disputes amendments to four offshore production sharing contracts.

Offshore staff

(West Africa) - Australian companies Woodside, Hardman Resources, and Roc Oil have been advised by the Mauritanian government that it disputes amendments to four offshore production sharing contracts.

Woodside says the dispute did not affect the $705 million Chinguetti oil field development, which is on schedule to begin producing later this month.

"It is business as usual," a Woodside spokesman says, maintaining the company would continue its plans to conduct a new exploration program over parts of the areas in dispute, beginning in the next three months.

The dispute follows a coup in Mauritania last August, which resulted in the overthrow of then president Maaouiya Ould Sid'Ahmed Taya.

In December the new government reportedly arrested the former regime's petroleum and energy minister on allegations of accepting bribes from foreign oil companies in exchange for waiving taxes and charges.

At the the time it was reported the companies involved came from Australia, Britain, Canada, Germany and Russia.

The areas in dispute cover production permits outside the Chinguetti development but are understood to cover gas and oil reservoirs discovered at Tevet, Banda, and Tiof about 90 km offshore from the Mauritanian capital Nouakchott.

The original permits over the areas were granted in 1998, before oil was discovered.

They were amended by the Mauritanian government following negotiations between the companies holding the permits and the Ministry of Energy and Petroleum and approved by the Mauritanian Parliament, before becoming law in 2005.

Woodside says it is confident the disputed amendments were proper, valid, and binding.

Woodside's joint venture partners in the four production sharing contract areas include Hardman Resources and Roc Oil as well as British companies BG Group, Premier Oil, Dana Petroleum, and Fusion Oil and Gas.

Woodside has a 47.83% stake in Chinguetti: Hardman Resources holds 19.01%; Roc Oil 3.25%; BG Group has 10.23%; Premier Oil 8.12%; and Mauritania has about 12%.

02/06/06




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