Identifier
Created
Classification
Origin
08BANJUL379
2008-12-03 15:46:00
UNCLASSIFIED
Embassy Banjul
Cable title:  

OIL EXPLORATION IN THE GAMBIA

Tags:  ECON ENRG PGOV GA 
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R 031546Z DEC 08
FM AMEMBASSY BANJUL
TO SECSTATE WASHDC 8408
INFO ECOWAS COLLECTIVE
UNCLAS BANJUL 000379 


E.O. 12958: N/A
TAGS: ECON ENRG PGOV GA
SUBJECT: OIL EXPLORATION IN THE GAMBIA

UNCLAS BANJUL 000379


E.O. 12958: N/A
TAGS: ECON ENRG PGOV GA
SUBJECT: OIL EXPLORATION IN THE GAMBIA


1. Summary: Ambassador met with Country Representative Gary
Griffin of Buried Hill Energy (Cyprus) for an update on the
petroleum exploration contract with the Government of The
Gambia. Buried Hill, a small wildcatter, has been operating
in The Gambia since 2002. They were awarded licenses to
explore two offshore blocks, A1 and A4, which according to
Buried Hill,s studies and analysis have potential for oil
discovery. Availability and cost of leasing drill rigs have
affected the anticipated start date for drilling.


2. In a meeting with Ambassador, Buried Hill Energy Country
Representative provided updates to the agreement the company
has with the Government of The Gambia (GOTG) for offshore
petroleum exploration. One of the conditions of the 30 year
agreement was that drilling would commence in early 2009.
Griffin explained that the price of crude and discoveries in
Ghana and Brazil had made cost of leasing drilling rigs
prohibitive for their small company. One rig which was
supposedly available to the company was leased by Ghana at a
cost of $675,000 per day. The leasing company wanted a three
year minimum lease and Buried Hill was looking for 90 day
leasing.


3. In a recent meeting with officials, the drill by date was
extended until the end of 2010. Griffin indicated that
Buried Hill was interested in a partner for the venture, but
drilling start up would not be affected without one. They
would however, welcome expressions of interest from US
companies. He indicated that the recent drop in world oil
prices was an advantage for them in that more rigs would be
available and less costly to lease.Buried Hill will soon
conduct operations seminar for local workers who will be
employed once drilling commences. Griffin is also taking a
small delegation of GOTG officials headed by the Secretary
General to head offices in Calgary in January 2009.


4. Comment: Since Buried Hill as a small company has been on
the ground in The Gambia since 2002, they are reasonably
confident of a positive exploration outcome. Griffin is
reasonably confident that the company has a good contract
with the GOTG, but is aware of the risks associated with
doing business here.


WELLS