Petroleum Licensing & Administration

About the Process

 

Petroleum Licensing and Administration core Process (PLACP)

Petroleum Licensing and Administration core Process (PLACP) is a section within the Ministry of Mines (MoM) that oversees all activities related with petroleum operations in the country. It is constituted of two main arms (branches)-one is Petroleum Licensing and the other Contract Administration.

The Petroleum Licensing and Administration work activities emanate from amongst the main objectives of the Ministry of Mines, which implicitly include:

• Advancement of petroleum exploration and development activities to enhance the overall development of the country;

• Make petroleum operations be one of the major contributors to the national economy;

•Undertake exploration activities in almost all prospective areas to unearth natural resources and make use of them to the benefit of the country and the people at large.

 

Major duties and responsibilities of Petroleum Licensing and Administration are to:

-          organize and prepare bid documents for tendering exploration blocks  and takes part in the screening and evaluation of final bid documents;

-          negotiate with applicant companies in accordance with The Model  Petroleum Production Sharing Agreement  and Petroleum Operations and   Income Tax Proclamations ;

-          perform promotional  activities, by  way of disseminating brochures, giving presentations and exhibiting posters;

-          monitor and inspect company (or companies) operations to ensure the activities of a contractor are carried out in accordance with agreement signed by parties (i.e. MoM and company);

-          provide support to operators/Contractors by communicating with other government institutions and offices;

-          make sure that financial terms of signed agreements are timely fulfilled; these are rentals, royalties, bonuses and other payments ;

-          represent the Ministry at international and regional forums in petroleum –related issues upon the  consent of the Minister or the State Minister;

-          keep all petroleum data in a secure repository and make them accessible to relevant business partners, academia and staff engaged in research and development.

 

Current Petroleum Exploration and Development activities

A number of international and few local companies are currently undertaking petroleum exploration in various parts of the country. Oil companies actively involved in the petroleum exploration and development undertakings are: Africa Oil Ethiopia B.V. (Subsidiary of Africa Oil Corp.), Calvalley Petroleum Inc., Epsilon Energy Ltd., Falcon Petroleum Ltd., Southwest Energy, Tullow Oil, Pexco Exploration (east Africa) N.V. and Afar Exploration.

Several of these companies have accomplished quite remarkable job in fulfilling their contractual obligations. Many of them have been engaged in acquiring geophysical data, including airborne gravity and magnetic, and some have done 2D seismic surveys covering large area, and have accomplished geological studies. Some unconventional geophysical exploration methods such as passive seismic and Full Tensor Gravity have been applied by different companies during their course of undertaking exploration in blocks where these methods are thought to be valuable.

A company has also applied for a license to produce oil from oil shale and full operation towards achieving this goal is due to start soon after signing of contractual agreement.

Calub and Hilala gas-condensate fields with estimated total reserve of 4 Tcf (reserve at Calub field is 2.7 Tcf and at Hilala field 1.3 Tcf) are recently awarded to a company named PetroTrans (Hong Kong-based Company) along with other blocks in the Ogaden Basin.

Negotiation is also underway to license Gambela block (Close to the petroliferous Southern Sudanese basins) in western Ethiopia.

There is still expression of interest to embark on exploration in some of the remaining open blocks in the potential Ogaden Basin. Sufficient information on the overall prospectivity of the basin to search for oil and gas can be obtained from data available in our documentation center. Available data on page 13 in the Brochure of Petroleum Potential of Ethoiopia…

All interested companies are welcome to apply for an open block shown in the License areas.