Ethiopia: Petronas suspends exploration work in Ogaden

(HornTrade) - The Malaysian oil and gas giant, Petronas, has suspended exploration work in the Ogaden basin due to security problems.

According to reliable sources, the company suspended work after Jason Read, a 39-year-old British geologist working for IMC on oil exploration, was killed last April by unidentified gunmen in Danot town, Warder zone. No group took the responsibility for the daylight crime.

The usual suspect for terrorist-related actions committed in the Somali Regional State is the Ogaden National Liberation Front (ONLF). However, this time the separatist group did not take responsibility for the murder; and the government did not accuse the group.

The ONLF said this week it had attacked an Ethiopian army base in the garrison town of Maqala, killing 94 troops. The Ethiopian government confirmed the skirmish but denied ONLF’s claim that it had captured Maqala town. The government said the local militia was able to defeat the attack, killing all of the rebel forces.

Petronas has been prospecting for oil in the Ogaden basin since 2005. Petronas acquired three blocks – Genale, Callafo and Wel Wel-Warder – in 2005 from the Ethiopian Ministry of Mines and Energy (MME). Later, the company acquired Block 11 and 15. In June 2007, the company signed an agreement with the ministry to develop the Calub and Hilala gas fields and made an up-front payment of 80 million dollars to the Ethiopian government.

The company planned to build a gas treatment plant and to construct a gas pipeline all the way from the gas fields to the port of Djibouti. The total investment is estimated at 1.9 billion dollars. However, work on the gas field development project has not yet commenced for various reasons, including security problems.

However, Petronas has been undertaking various exploration activities in its concessions that lie on 93,000 sq.m of land.

Source: Reporter

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