Mining’s old guard needs strong medicine
A new report details subpar investor returns in the mining industry over the last decade, particularly big cap diversified companies which have not adapted to new realities.
Madagascar has given French oil major Total a one-year extension of an exploration licence for the Bemolanga block shared with Madagascar Oil and expanded it to include conventional oil, a senior official told Reuters on Thursday.
Madagascar Oil and Total announced earlier this month that it is scuttling plans to develop a 1.2bn barrel oil sand deposit on the island after three years of extensive work. The Bemolanga bitumen deposit was first drilled in the late 1800s and would have cost upwards of $8bn to bring into operation.
Total has a 60 percent interest in the licence, with Madagascar Oil holding the other 40 percent. Madagascar Oil said in its annual report at an evaluation price range per barrel of $60-$100 Brent, the cost of handling the ore, the bitumen extraction, and the upgrading and shipping, does not presently support proceeding with the mine project.
Reuters reports exploration has been hampered since 2009 by a political crisis. In March, the Ministry of Mines suspended tenders for 225 offshore oil exploration blocks.
Brent Oil was trading around the $116 per barrel level on Friday after it spiked to $127 a barrel in April, close to the all-time high of $147.
Six out of the eight species of baobab trees (pictured) are endemic to Madagascar.
