MOSCOW, Jul 21 (PRIME) -- GPB Resources, an affiliate of Russia’s Gazprombank, has signed a production sharing agreement for an oil and gas field in the Afar Region of Ethiopia and will invest at least U.S. $2 million in the development of the deposit, Kommersant business daily reported Monday, citing a GPB Resources representative Sergei Togashev.
GPB Resources will have seven years to explore the deposit and 25 years for the development, Togashev said.
The territory is mostly unexplored and its potential resources are unknown. The company will spend $2 million during the first three years of exploration and then decide whether it needs to prolong works, Togashev said.
Ethiopian authorities have proactively given licenses for local exploration. Large companies deem the region to be too risky, while independent Ireland’s Tullow Oil and Canada’s Africa Oil found signs of commercial reserves of oil in the country in 2013.
“The general geologic logic is the following: Ethiopia stands on the way of the Great Rift Valley, which starts in Mozambique and finishes in the Red Sea. Large oil and gas deposits have been found on the borders of the Earth's surface fault in Mozambique, Tanzania and Sudan, and lately in Uganda and Kenya,” Togashev said.
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