Madagascar Oil Continues Strong in Aftermath of Coup

On Wednesday, the CEO of Madagascar Oil, Alex Archila, reported that the company continues to move forward with exploration and development programs in the country, despite the recent political upheaval.

While the company head declined to comment on the political environment in the country, Madagascar oil is proceeding as planned with its onshore heavy oil projects.

"Regarding our work program, we are pleased to tell you that Total continues to make progress towards drilling approximately 80 wells this year," Archila told Rigzone.

"In Tsimiroro, we continue evaluating the results of the 40 or so wells we have drilled in the past two years and continue to assess the best way forward for our exploration blocks," Archila added.

Located off the southeast coast of Africa in the Indian Ocean, Madagascar won its independence from France in 1960, establishing itself as a democratic republic. On Tuesday, the country's elected leader, Marc Ravalomanana stepped down as president of Madagascar. Andry Rajoelina replaced him as president, by order of the military, which is contrary to the country's constitution.

Strikes and demonstrations since the start of 2009 have resulted in the deaths of 135 people, virtually halting Madagascar's blossoming tourism trade. The violence has been localized to the country's capital of Antananarivo. This coup, along with the recent political coups in Mauritania and Guinea, may have dimmed the light that foreign investors have been shining in the region.

A Houston-based, privately held company, Madagascar Oil currently holds the largest amount of onshore acreage in Madagascar for oil and gas exploration and development. In September 2008, the company farmed out 60% and operatorship of the Bemolanga oil sands project to French major Total. Bemolanga is expected to hold 9.8 billion barrels of recoverable reserves. Held 100% by Madagascar Oil, the Tsimiroro heavy oil project is expected to recover an estimated 55% of reserves through SAGD development.

Other upstream companies present in the country include Tullow Oil, Sterling Energy and ExxonMobil.