ChevronTexaco confirmed that Angola block 0 held by Cabinda Gulf Oil Co Ltd. (CABGOC) has been extended beyond 2010 to 2030 by the Angolan government and Sonangol.
The 2,155 sq mi concession lies off the coast of Cabinda and holds 36 fields including Takula and Malongo. CABGOC is operator (39.2%) on behalf of its partners, Sonangol (41%), Total (10%) and ENI (9.8%). Current average production is about 400,000 b/d.
"ChevronTexaco would like to express its thanks to the government of Angola, Sonangol and our Block 0 Association partners for the constructive approach they have taken in helping to reach this milestone," said ChevronTexaco's chairman and chief executive officer, Dave O'Reilly. "This agreement is the latest highlight in ChevronTexaco's long-term partnership with Angola and underscores our commitment to a country where we have had a presence since the 1930s. It also sends a strong message to the international business community that we have found Angola to be a good place to invest. The extension enables the block 0 Association partners to optimize the further development of block 0 to the benefit of the Angolan people and the association," O'Reilly said.
In a move welcomed by international observers, Sonangol made public the $210-million "signing bonus" and an additional $80-million "social bonus," part of which will be targeted specifically at Cabinda Province. The association partners pay the social bonus under terms of the extension agreement.
Referring to the disclosure as "an important step" in the ongoing reconstruction of post-war Angola, Manuel Vicente, chairman and chief executive officer of Sonangol, said, "The government of Angola understands that good governance is a cornerstone of good business and that it is in our own interest to make progress in this important area. Economic growth and stability are critical factors in the reconstruction of Angola and that is why we are working diligently to put in place the financial management systems necessary to facilitate the resumption of normal economic life for Angola's people, to foster international trade and to encourage foreign direct investment in our country."
The extension agreement formalizes a Heads of Agreement governing the flow of investment monies to block 0 capital projects. This includes the Sanha gas condensate development, which is on schedule and will cut gas flaring on the block by half when it comes onstream fully in early 2005.
"Today's announcement is not only good news in terms of our ongoing operations and capital investment program in Angola, it also means we can continue to build on the solid progress we have made in other areas, including the steady 'Angolanization' of our work force," said James R. Blackwell, managing director of ChevronTexaco's Southern Africa strategic business unit. "Already, about 63% of CABGOC's technical staff and management are Angolan, along with more than 87% of the total work force. Under the terms of the extension agreement, we are committed to expanding those numbers so that by 2010 90% of those within our technical and managerial ranks will be Angolan."
CABGOC also confirmed that it will open an office in Cabinda City during 2005.
------------------
05-14-04
