CAPE TOWN Nov 27 Madagascar Oil, which
began producing oil in May for its own steam generators, aims to
have a plan approved next year to allow it to begin the
country's first commercial sales, its chief operating officer
The island off Africa's east coast is part of a new scramble
for hydrocarbons in the region which has included significant
gas finds off the coasts of Tanzania and Mozambique.
Madagascar Oil uses steam injection methods to extract crude
from its inland operations in a remote, western section of the
"With any thermal project fuel is a major issue. Some of our
projections are that we will use 20 percent of the crude that we
produce for steam generation," Stewart Ahmed told Reuters on the
sidelines of an Africa oil conference in Cape Town.
The project is still in its exploration stage so Madagascar
Oil does not have a license to sell any of the oil it has
extracted so far but it intends to declare commerciality in
around February of next year.
A development plan must then be submitted to the Malagasy
government within 180 days of that declaration.
"It will be subjected to significant scrutiny as it is the
first time that the Madagascar authorities will have been
confronted with a hydrocarbon development plan. So we are going
to put in a thorough document," Ahmed said.
When that is approved, the company can then move to
The aim in the first two or three years is to produce around
10,000 barrels per day from its Tsimiroro heavy oil field and
then slowly crank output up.
"With this resource it is realistic to talk in terms of
100,000 to 150,000 barrels per day peak oil," Ahmed said. He
said it would probably take over a decade to get there.
The Tsimiroro field has estimated resource of around 1.7
billion barrels of oil in place.
Much of the oil will likely be used in Madagascar for power