French oil giant, Total, was yesterday awarded an exclusive right by Nigeria and the Island of São Tomé and Principe, to begin exploration for oil in three blocks, 7, 8 and 11, located within the hydrocarbon-rich Joint Development Zone (JDZ) owned by both countries in the Gulf of Guinea.
The development coincided with the rise of crude oil price to a four-month high at $68 per barrel, boosted by tightened global supply and a monthly report of the Organisation of Petroleum Exporting Countries (OPEC), which built a case to extend production cuts beyond June.
The right to explore for oil in the JDZ blocks was formally granted to Total after negotiations were concluded and a Production Sharing Contract (PSC) signed by parties involved at a ceremony held in Abuja.
The JDZ is an area in the region of the Nigeria – São Tomé and Príncipe boundary region speculated to be rich in oil and gas reserves.
And, considering that neither country could have explored the resources in the zone without interfering with their maritime rights, they agreed in a treaty to create a Joint Development Authority (JDA) to develop the field and mutually benefit from its resources.
The JDZ with regards to this was signed in Abuja on February 21, 2001.
