$650B Worth of Oil Reserves Being Auctioned in Congo

Oil blocks that the Democratic Republic of Congo plans to auction have reserves estimated at 16 billion barrels that would be worth more than $650 billion at current prices, according to the country’s oil minister.

Preliminary data compiled by Texas-based GeoSigmoid still need to be confirmed by further exploration and “the discovery of economically profitable hydrocarbon deposits,” Minister Didier Budimbu said Saturday in a speech announcing the results. The estimates are based on an oil recovery rate of 35% and an average price of $107 a barrel. 

The 16 blocks will go on tender on July 28 and 29 in Kinshasa, the capital. The four blocks along the Tanganyika valley are forecast to have 7.25 billion barrels of reserves while the nine offered in the Cuvette Centrale, or central basin, have an estimated 6.4 billion barrels, according to Budimbu. The Ndunda block near the Atlantic coast has an estimated 130 million barrels, while Nganzi potentially has 2 billion barrels, and Yema/Matamba-Makanzi 800 million barrels, he said.

Congo is the largest country by landmass in sub-Saharan Africa with significant potential oil reserves but its current production is only about 25,000 barrels per day from aging oil blocks controlled by France’s Perenco SA on the Atlantic Ocean coast. 

While the blocks have potential to generate revenue in an impoverished nation whose budget for this year is projected at $11.1 billion, the tender offers have sparked concern among environmentalists over opening Congo’s massive rainforests and the world’s largest peatlands to exploration. The oil ministry said in a video presentation that the blocks were chosen “meticulously” and take into account the sensitivity of the country’s protected areas.