Oil and Natural Gas in Morocco

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According to January 2006 estimates by the Oil and Gas Journal (OGJ), Morocco has proven oil reserves of 1.07 million barrels and natural gas reserves of 60 billion cubic feet (Bcf). Morocco may have additional hydrocarbon reserves, as many of the country's sedimentary basins have not yet been explored.
Morocco produces small volumes of oil and natural gas from the Essaouira Basin and small amounts of natural gas from the Gharb Basin. Consequently, Morocco is the largest energy importer in northern Africa. The country’s total yearly costs for energy imports range from $1- $1.5 billion. However, high oil prices in 2005 increased import costs to approximately $2 billion for the year. In 2003, the Moroccan government announced that foreign companies could import oil without paying import tariffs. This followed a 2000 decision, in which, Morocco modified its hydrocarbons law in order to offer a 10-year tax break to offshore oil production firms, and to reduce the government's stake in future oil concessions to a maximum of 25 percent. The entire energy sector is due to be liberalized by 2007.
The Moroccan Office of Hydrocarbons and Mining (ONHYM) has become optimistic about finding additional reserves - particularly offshore - following discoveries in neighboring Mauritania. At the end of 2005, 19 foreign companies were operating in Morocco, with an estimated total investment of $56 million per year.

Recent activity in Western Sahara, which is believed to contain viable hydrocarbon reserves, has been controversial. In 2001, Morocco granted exploration contracts to Total and Kerr-McGee, angering Premier Oil and Sterling Energy, which previously had obtained licenses from the Polisario government. In 2005, the government-in-exile of the Western Sahara invited foreign companies to bid on 12 contracts for offshore exploration, with hopes of awarding production sharing contracts by the end of 2005. Both Premier Oil and Sterling Energy received conditional exploration rights. Foreign companies operating under Moroccan concession in Western Sahara have become targets of international protest campaigns. These companies include Total, Wessex Exploration Ltd, Svitzer (the British subsidiary of the Dutch company Fugro), Wales' Robertson Research International and Norway's TGS Nopec. All have ended their operations in Western Sahara, with the exception of Kerr-McGee. As of November 2005, the company was the last to be drilling in Western Sahara, although the Polisario government has pressured it to pull out.

  • Oil production: 300 bbl/day (2005 est.)
  • Oil proved reserves: 100 million bbl (2006 est.)
  • Natural gas production: 50 million cu m (2004 est.)
  • Natural gas proved reserves: 1.218 billion cu m (1 January 2005 est.)
  • In March 2004, Calgary-based Stratic Energy Corporation committed to a three-year exploration program in two onshore blocks in northwest Morocco. The two concessions cover approximately 1,544 square miles.
  • In April 2004, Norway's Norsk Hydro signed a 12-month exploration contract for the Safi Offshore Northwest zone, while Denmark's Maersk signed an eight-year agreement for eight blocks near Tarfaya.

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