KMG to pull out of Western Sahara

By Barry Morgan

Upstream Online, 2. May 2006

Kerr-McGee is pulling out of Western Sahara following pressure from activists pushing for Sahrawi Arab Democratic Republic (SADR) independence from Morocco.

Kerr-McGee said the company was shifting its focus towards proven oil plays, such as China, Brazil and Trinidad & Tobago, and that Western Sahara did not fit in with the new strategy as it "was not a proven hydrocarbons basin".

Morocco, along with the Kerr-McGee literature, describes the offshore Boujdour play as Rabat\'s southern province, but local people have long sought self-determination for what the United Nations calls a non self-governing territory, having just renewed its peace-keeping mandate for six months.

The reconnaissance permit for Boujdour expired at the end of April, with the US explorer attracting criticism from activists, operating under the umbrella organisation Western Sahara Resource Watch, all of whom have assisted the SADR to promote its case on the international stage.

Two other US explorers participate in Boujdour - Pioneer Natural Resources (20%) and Kosmos Energy (30%) - alongside Kerr-McGee, which has a 50% stake.

Addressing a Global Pacific conference in London last week, Kosmos vice president for exploration Brian Maxted insisted his company was "taking a position at the table". "We think the political situation will soon be resolved in the interests of all parties," he said.

It remains unclear whether Kosmos and Pioneer will be legally able to move the licence towards production sharing status on their own initiative.

Source: http://www.upstreamonline.com/