LONDON (Dow Jones Newswires), Apr. 1, 2009
French oil producer Total SA said the company wasn't concerned that the political unrest in Madagascar will affect its 60% stake in the Bemolanga heavy oil project and expects production to begin as planned in 2018.
Total spokesman Kevin Church Wednesday said the company was yet to finalize some details in its extraction contract for the 10 billion barrel resource deposit, and will need to negotiate those matters with whichever government is in power.
Total hadn't previously publicly released its estimated production timeline for the project.
A military-backed coup led to Andry Rajoelina, the mayor of Madagascar's capital Antananarivo, taking over from former president Marc Ravalomanana's government in March.
AFP reported Tuesday that Rajoelina, now the leader of the country's transitional government, has frozen foreign mining companies' contracts and has ordered a review to ensure greater revenues from drilling and extraction rights.
Total bought its stake in the Bemolanga license last September from Madagascar Oil S.A., a private oil and gas company based in Houston, which held the license for the deposit and retained a 40% stake.
Church said the company had discussed finalizing the outstanding details with the previous government.
"We're not at all worried about this situation," said Church. "We already know we need to renegotiate and clarify parts of the contracts."
Copyright (c) 2009 Dow Jones & Company, Inc.
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