On 15 June, the government-managed National Hydrocarbons Corporation (SNH)
awarded its first petroleum exploration contract on the previously contested
Bakassi
peninsula. The production-sharing contract for Bakassi West was awarded to a
consortium led by Dana Petroleum (a subsidiary of the Korean National Oil Company), which heads a consortium of
four firms.
The four-year agreement, worth US$31 million and could be extended by a further
two-year period to increase to the tune of US$71 million, will be operated by
Dana, with equity interests held by Canada's Madison Petrogas and Cameroon's
Soft
Oil & Gas Ltd.
The ceremony was overseen by Cameroon's Minister of Mines, Industry and
Technological Development Emmanuel Bonde, while the accord was signed for Cameroon by the Executive Manager of SNH Adolphe Moudiki and Dana's country manager John William Downey.
The contract authorises the consortium to acquire, process and interpret seismic
2D data and the drilling of two exploration wells.
Thought to be rich in oil, Bakassi was under Nigerian control for at least 15
years until 2008, when the peninsula was returned to Cameroon following an
October
2002 ruling by the International Court of Justice. Although Nigeria has
accepted
the ruling, the area has faced pockets of resistance from armed splinter groups
undermining Cameroon's authority there.
The groups have severally captured Cameroon troops and foreigners operating in
Bakassi, urging Cameroon and governments of the captives to pay ransom. In
2010,
Cameroon fortified the area with the anti-terrorist Rapid Intervention
Battalion, causing a reduction in the groups' activities. Operating under the
moniker Bakassi Freedom Fighters (BFF), the groups have not been entirely deterred, however, and made their last
attack in October 2011, killing two Cameroonian soldiers.
For more news and expert analysis about Cameroon, please see Cameroon Politics & Security.
© 2012 Menas Associates