Congo Wants Oil, Gas Pipelines From Eastern Border to Atlantic

Democratic Republic of Congo wants to build a pipeline network to transport oil and natural gas from the east of the country to the Atlantic Ocean, Oil Minister Celestin Mbuyu said.

The Central African country is aiming to increase its oil production and is currently allocating blocks of land to companies for exploration. In October Congo signed an accord with Uganda and Kenya to study the construction of a pipeline that will transport crude oil from deposits near its eastern border to ports on the Indian Ocean. Congo’s only coast is on the Atlantic.

The Ugandan pipeline is a temporary solution, Mbuyu said in an interview on Feb. 14 in Kinshasa, Congo’s capital. “In the long term, we want an integrated industry. We need a network of pipelines for gas and oil” to the Atlantic. Congo’s main ports are Banana on the Atlantic coast and Matadi and Boma, on the Congo River, which flows into the Atlantic.

Congo currently produces about 25,000 barrels of oil a day and plans to increase production through drilling near its eastern borders with Tanzania, Burundi, Rwanda, and Uganda, as well as in its central basin and along its western coast bordering Angola. The distance between the eastern deposits and the Atlantic coast is about 2,150 kilometers (1,336 miles).

Angola is the second-biggest oil producer in Sub-Saharan Africa after Nigeria and Uganda will begin exporting oil from estimated reserves of 2.5 billion barrels next year from wells owned byTullow Oil Plc. Most of Uganda’s reserves lie in a geological feature known as the Albertine Graben, which straddles its border with Congo.

Methane Gas

Eni SpA of Italy bought a stake in an oil block owned by Surestream Petroleum Ltd. last year, and Paris-based Total SA is expected to complete a deal shortly with South Africa’s SacOil Holdings Ltd. for a percentage of its oil block along the Ugandan border, Mbuyu said. The pipeline network may take 15-20 years to build, need financing from oil companies and the country would also want to establish refineries both in the east and west of the country, he said.

Congo and Rwanda are also nearing an agreement to exploit methane gas under Lake Kivu, Mbuyu said.

“We think we’ll make a call for offers soon and we’re looking for a serious company,” he said, without giving more detail.

The project will generate about 200 megawatts of electricity, distributed equally between both counties, a Feb. 11 statement e-mailed by Rwanda’s ministry of infrastructure said.

Congo is recovering from more than 40 years of dictatorship and war. The country was ranked the 175th most difficult country in the world in which to d0 business according to rankings compiled by the World Bank that surveyed 183 economies.

Last year, Congo’s senate passed a new oil code that will regulate the industry and should increase investment, Mbuyu said. The code is now under consideration by the country’s national assembly.

(Source: http://www.bloomberg.com/news/2011-02-16/congo-wants-oil-gas-pipelines-from-eastern-border-to-atlantic.html)