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Sudan Considers Compensation For White Nile Ltd and Its Block Ba License

07-09-2007

Sudan government has told the White Nile Ltd to withdraw from a disputed field. The Company’s chairman, Mr. Phil Edmonds, said the resolution needs clarification and he believes WNL’s licence remains legally binding. Aim-listed White Nile is thought to have invested about $18m (£9m) on seismic testing and other work at Block Ba, in southern Sudan.

Reports from the country said the Ministry of Energy and Mining had appointed a technical committee to consider compensation.

The block was disputed between French oil giant Total and the British exploration company, which is 50pc owned by the semi-autonomous south Sudan government oil company NilePet.

But the decision to ask White Nile to withdraw is thought to have been made by the Sudanese National Petroleum Commission which, under a north-south peace deal, has authority to assign oil contracts. The Government of South Sudan (GOSS) had allowed exploratory drilling by White Nile in areas already claimed by Total, which says it signed with Khartoum before a 2005 peace deal ended more than two decades of north-south civil war. Most of Sudan's oil lies in the landlocked south, although refineries and pipelines are in the north.

In a statement, White Nile said that Mr Edmonds met the GOSS vice-president last week, and was assured of the company's continuing participation in Block Ba. White Nile said: "We are taking all appropriate steps to protect our licence agreement. The Board retains its belief the company's licence remains legally binding. It is seeking urgent meetings with the GOSS to clarify the situation."