IRVING, Texas (November 22, 1996) - Exxon Corporation today announced that a
Consortium headed by its affiliate, Esso Exploration and Production Chad Inc.
(Esso), has signed a Memorandum of Understanding (MOU) with the Government of
Chad on development terms that represent an important step leading to the
first commercial oil production in that country. The MOU addresses key
financial, legal and operating terms under which the Doba Basin project in
southern Chad would be developed.
The project area, located about 350 miles south of Chad's capital, N'Djaména,
is estimated to contain approximately 900 million barrels of recoverable
reserves. The total cost of developing the reserves and the infrastructure
needed to transport them is expected to be in the range of about $3 billion.
Esso is operator for the Consortium and holds a 40% interest, while Société
Shell Tchadienne de Recherches et d'Exploitation and Elf Hydrocarbures Tchad
hold 40% and 20% interests, respectively.
According to Dean L. Guttormson, President of Esso Exploration and Production
Chad Inc., "This MOU represents significant progress toward the development of
these resources, which are mutually important to Chad and the Consortium
members. Remaining milestones include final government ratification of terms
and the securing of project financing." In the interim, the Consortium will
invite proposals from potential bidders for the major engineering, procurement
and construction contracts.
The Doba Basin Project would draw on reserves from three oil fields in
southern Chad. Approximately 300 wells would be drilled, with peak production
projected to be about 200-250 thousand barrels of oil per day, beginning as
early as the year 2000. This production would be gathered into a central
treating facility located in the field area. The oil would then be transported
approximately 650 miles via a 30-inch pipeline across Chad and the neighboring
Republic of Cameroon to the Atlantic coast. The Presidents of Chad and
Cameroon recently signed a Bilateral Treaty which established the basis for
construction and operation of this pipeline. Commercial tankers would then be
loaded from an offshore marine terminal near the town of Kribi, Cameroon, to
carry the oil to world markets.
The MOU also outlines a second potential project in Chad. This project would
call for development of the Sedigi field north of Lake Chad and a pipeline to
supply a refinery to be built in the capital city of N'Djaména and to be
operated by Société d'Etude et d'Exploitation de la Raffinerie du Tchad
(SEERAT). The refinery would produce fuel for transportation, electric power
generation and other uses.
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