Drilling could resume by San Leon near occupied capital
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San Leon Energy's controversial oil programme in occupied Western Sahara might continue with more drilling, according to company.
Published 22 September 16

The Irish company San Leon Energy and the Moroccan state oil company ONHYM "now intend to apply for a long licence, which may include 3D seismic over the broader structure (including the existing well), and the well may also be re-entered."

The Irish oil company San Leon held its Annual General Meeting on 20 September, where its intention to sign a new licence was mentioned in the 2015 Annual Report. San Leon is operator of two blocks which are located in the north-west and north-east part of the territory or Western Sahara, partially overlapping into Morocco proper.

The two exploration blocks, Tarfaya and Zag, respectively, are highly controversial, as the UN has stated that any further oil exploration in Western Sahara would be in violation of international law if the Saharawis were not consenting and do not benefiting.

Not a single reference to Western Sahara was made in San Leon's annual report. All references to the Zag and Tarfaya blocks give the impression that they are located in Morocco, which they are not. The misrepresentation has been systematic for a number of years to its investors, including probably to those who placed £29 million in the company in 2015, enabling the company to carry out the drilling in Western Sahara.

The company notes in its annual report that further spending on the Tarfaya oil shale licence "has been restricted, pending a recovery in the oil price".

The information about San Leon and ONHYM now seeking a new longer licence for the Tarfaya licence in the occupied territory, sheds light on the disappearance of the Tarfaya block from a recent ONHYM map, dated 24 June 2016, where the block had been removed.

San Leon Energy drilled the Laayoune-4 well during late 2015. The company announced it were on the traces of gas, but that it did not encounter what it was looking for. Thousands of Saharawis protested the drilling operation.

The San Leon drilling operation in 2015 was the first ever to have been done since Morocco brutally annexed the territory in 1975. The drilling itself was done by Entrepose, a subsidiary of the French Vinci Group.

The largest sovereign wealth fund in the world divested from San Leon earlier in 2016 for "violating fundamental ethical norms" through its operations in the territory.

Other recent oil updates:

  • WSRW on 18 August wrote about the weak financial situation of San Leon's partner on the Zag licence, PetroMaroc. PetroMaroc issued twice over the last 8 days statements on its financial situation, underlining there is no news on that front. The last statement on 14 September.

  • 24 August, Polish media reported that the subsidiary of the Polish oil company PGNiG had suddenly evacuated its staff from the occupied territory, citing political reasons. 5 September, Polish newspaper TP wrote that company denies pressure from the government of neighbouring Algeria.

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