Addis Ababa, July 3 - Delonex Energy, an exploration and production company, will invest $600 million for oil and gas exploration in Ethiopia and other central and east African countries, the Indian chief executive of the company said here.
These regions were selected for investments following the recent discoveries of gas in Mozambique and Tanzania, and of other hydrocarbon findings in Uganda and Kenya.
This follows the company's agreement with Warburg Pincus, a global private equity firm focusing on promising oil and gas assets in sub-Saharan Africa, Delonex announced.
"Africa has a successful track record among similar basins around the world, the planned exploration is expected to be a promising one," said Rahul Dhir, chief executive of Delonex, who was the former CEO of Cairn India.
Delonex says their focus is largely going to be in Ethiopia, Kenya, Uganda and Central Africa since the region is still in its early days of exploration. The entire region, from Central Africa, Chad, South Sudan and Ethiopia down to Mozambique has only had about six hundred exploration wells since the early 1900s.
"According to our findings, the number of wells drilled in Ethiopia for oil and gas explorations is particularly minimal
"We believe, with the application of modern, technological and new drilling techniques, the potential can be tested and hopefully there will be significant discoveries to be made," Dhir said.
Currently, the company is systematically building relationships by meeting with different companies and governments across the region.
The Delonex team has been quite successful in conducting drilling operations in various Asian countries, resulting in the first hydrocarbon discoveries in the Mannar Basin in Sri Lanka. It has also unearthed oil and gas in remote onshore and offshore sites in Southeast Asian countries like Indonesia, Thailand and Malaysia.
It has also revealed the full potential of the Barmer basin in India's Rajasthan state, establishing a 1.7 billion barrels oil equivalent recoverable resource base.
"Our success in India has helped reduce the country's oil imports by approximately $14 billion and contributed around $6 billion to the Indian exchequer" Dhir said.
The company has considerable interest in strategic areas like the East African Continental Rift System, which extends from the Red Sea through Ethiopia, Kenya, Uganda and Tanzania to Mozambique, the Central African Rift System stretching from Chad to South Sudan and the coastal areas of east Africa.
According to Dhir, Delonex Energy plans on gaining access to these areas through "farm-in" acquisition of interest from existing licensees, as well as by direct awards from host governments.
"Having the ability to invest $600 million puts us in a better position and able to compete with other companies in Ethiopia as well as the other African countries with sufficient funds" Dhir added. (IANS)