GPB Global Resources Signs A Deal for Exploring Petroleum in Ethiopia
Sergey Tagashov, the Executive Director for Corporate Communications of GPB Global Resources B.V., stated that the company seeks to invest around $60 million exploring oil in the northeastern part of Ethiopia.
The company signed a production-sharing agreement with the government that includes seven years for oil exploration and twenty-five years for the production. During a phone interview, Mr. Tagashov stated that the amount invested would be centered on carrying out surveys and drilling test wells in the Afar region. The region constitutes part of East Africa’s Rift Valley. The test wells will be drilled in a 42,000 sq km area. More information about the company at Bloomberg.
Sergey also said that GPB Global Resources B.V. made a logical move by deciding to explore in the Afar region. This is because there are many oil discoveries along East Africa’s Rift Valley in other countries. Despite Ethiopia having natural gas reserves of about four Tcf in the East, no gas or oil has ever been produced in the nation. However, the first oil discoveries in Uganda and Kenya that are being generated for commercial purposes are along the Rift Valley, meaning that Ethiopia has the potential of producing oil.
Signing an oil exploration deal in Ethiopia has been easy for the GPB Global Resources B.V. since the government is looking for new sources of revenue to offset a trade deficit that is expected to climb from 8.5 billion dollars in the previous year to 8.9 billion dollars. Sergey Tagashov said that investing in Ethiopia is an excellent decision due to the country’s ranking as the second-most populated nation in Africa, with around ninety million people. The country’s growing economy and political stability also make great investment incentives. China’s GCL-Poly Energy Holdings and Hong Kong’s Southwest Energy are also looking to invest in the country.
Mr. Tagashov said that even if the discovery is not significant for a major pipeline to be used for exportation, the local oil production will be in a position to cater to the bill. This is because the company has a twenty-five-year license for production.
About GPB Global Resources
GPB Global Resources B.V. was founded in 2011 by Boris Ivanov. The company deals with oil exploration and production.