Oranto signed a PSA for South Sudan Block B3 in March 2017. The PSA has a six year exploration period and Oranto is the Operator with 90% equity, Nile Petroleum holding the other 10%.
Despite the country’s turbulent history, South Sudan is the only mature oil producer in East Africa. Indeed, the region is one of the longest-running producers on the continent, and has substantial proven reserves, with close to 3.5 billion barrels of oil and 3 trillion cubic feet of gas in proved reserves,
But despite the country’s established industry, up to 70 percent of South Sudan remains unexplored for oil and gas.
As the newest entrant into South Sudan’s oil and gas sector — and the first company to sign an exploration production sharing agreement (EPSA) with South Sudan following independence in 2011 — we know that the time is now to invest in South Sudan.
We signed the EPSA with the Ministry of Petroleum of South Sudan for Block B3 in March 2017 and began exploring the block through an agreement with BGP South Sudan just eight months later. As a company, we have committed to spending USD $500 million on the development of the 24,415-square kilometer acreage area, and we wasted no time in launching that investment.
Following a competitive tender process, geophysical specialist BGP was selected to perform an airborne gravity and magnetic survey of the contract area. The results are quite encouraging, and we have contracted Schlumberger for the interpretation of the data.
We will also contract an environmental specialist to complete the Environmental Impact analysis, which will enable us to gauge when and where the acquisition would be carried out based on the environmental results. We will do the first stage of the 2D in the beginning of 2019.
South Sudan has implemented fair and balanced regulatory policies and welcomes international investment. The security situation in the country also continues to improve, after the Transitional Government of National Unity of the Republic of South Sudan signed the peace deal with rebels earlier this year. All of the country’s operating oil companies are once again producing oil, with two companies bringing production on just this year.
While frontier exploration can be risky, we have a very strategic investment strategy, which includes seeking partners for de-risked assets and actively pursuing investments and divestments. We know that Africa is at the forefront of frontier exploration globally, and we are, by acreage, the largest indigenous frontier exploration player in Africa. We plan to continue the exploration success in South Sudan and look forward to playing a part in the development of the country’s oil and gas sector.