* Exxon, Petronas and Ophir among the firms chosen
* Gabon hopes to reverse chronic oil decline
* Tough negotiations have lasted nine months
(Adds details on contract negotiations, context)
By Emma Farge
DAKAR, July 21 Gabon has selected seven
companies for a final round of negotiations as part of an
offshore licensing round the government hopes will reverse a
chronic decline in output, the country's oil ministry said on
The new blocks are located in deep offshore waters - an
exploration play that is expensive and uncertain but potentially
very rewarding given the similarity of geological structures to
oil-rich Brazil, where billions of barrels of oil have been
Former OPEC member Gabon produces about 230,000 barrels per
day (bpd), down from a peak of close to 400,000 bpd in the
An oil ministry statement said that Impact Oil & Gas, Repsol
, Perenco, ExxonMobil, Marathon,
Petronas and Ophir were ranked highest for the nine
blocks due to be allocated.
"These companies listed are invited to finalise negotiations
for the signature of the relevant CEPPs (exploration and
production-sharing contracts) as soon as possible," according to
a statement signed by Minister for Oil and Hydrocarbons Etienne
The statement showed that Cobalt, Noble,
Royal Dutch Shell and Total were ranked lower
down the pecking order for the blocks. The ministry said it had
the right to open negotiations with the lower-ranking contenders
if talks with the first-choice companies were unsuccessful.
Bids for another eight blocks offered "did not reach the
expectations of the Gabonese Republic", the statement added.
A spokesman for Total, one of the largest producers in the
former French colony, said it planned to enter talks with the
government for one of these blocks, named F15.
The deals end nearly nine months of arduous negotiations
involving multiple contract revisions, with some prospective
investors complaining privately of tough terms.
"It is a very aggressive production-sharing contract. Some
of the terms were trending towards a lack of certainty over
assets," said a source involved in the negotiations.
The ministry said that it had ranked companies based on a
range of criteria including social and environmental
responsibility as well as companies' capacity to help to fight
piracy and to involve Gabonese companies.
Another source familiar with the talks said that the high
number of companies involved in negotiations showed the appeal
of Gabon for explorers, despite high-profile disputes with Total
and Sinopec's Addax.
"It's not an easy place to do business, but they are still
attracting quite a few companies," the source said.
One of the contested points during negotiations has been the
participation of the Gabon Oil Company, created in 2011, sources
familiar with the talks said.
During exploration, the Gabon Oil Company has the right to
acquire a 15 percent stake at market price, according to a draft
contract seen by Reuters.
The state has a right to a 20 percent stake from the start
of oil output and must contribute to production costs, the same
contract showed. It was not clear if these articles had been
subsequently revised during negotiations.
(Editing by Keiron Henderson and David Goodman)