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Tuesday, 18 June 2013

Seychelles opens up to oil explorers

The Seychelles have invited oil and gas companies to bid for exploration blocks, ending a two-year moratorium and introducing new rules for bidders after completing a review of laws regulating the sector.

East Africa has become a focus for exploration after oil discoveries in Uganda and Kenya as well as natural gas finds in Tanzania and Mozambique.

The Indian Ocean islands are attracting interest but had put off licensing more blocks until it reviewed its laws. Seychelles does not have a fixed number of exploration areas, but companies can bid for areas of up to 10 000 square km each out of its 1,3 million km2 exclusive economic zone.

In March, PetroSeychelles said companies had approached it for areas but could not place bids before the new legislation was in place. Under the new licensing regulation, exploration companies will be required to pay 10% of petroleum revenues as a royalty, up from a previous 5%.