Saharawi Arab Democratic Republic


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Technical Cooperation Agreement signed with British-Australian oil company to evaluate offshore petroleum potential

The Saharawi Arab Democratic Republic (SADR) announces that it has signed a Technical Cooperation Agreement (TCA) with the British-Australian exploration company, Fusion Oil & Gas plc (Fusion), that will lead to a detailed assessment of the oil and gas potential of the offshore territorial waters of the state.

The final assessment of oil and gas potential will allow the Government of the SADR to determine the possible economic value of its offshore territory and provide a technical and commercial foundation for future engagement with the international oil industry.

Under this agreement, Fusion will conduct, at its own cost, an integrated study of all relevant geological and geophysical data available over Saharawi territorial waters (coastal to ultradeep). It is anticipated that the exclusive study will take up to sixteen months to complete, and following this Fusion will have the right to nominate up to three areas for future exploration licensing on regionally competitive terms. These licenses will be awarded within six months of the SADR joining the United Nations.

The Government of the SADR has repeatedly opposed the commencement of exploration activities whilst the United Nations has been engaged in the organisation of the planned referendum on self-determination. The recent award of exploration licenses over the offshore territory to United States and French oil companies by Morocco is therefore seen by the Saharawi State as illegal, offensive and highly provocative. A recent UN legal opinion on the legitimacy of this Moroccan action, concluded that activities will be unlawful once any resource begins to be exploited. These exploration awards, made by the Moroccan occupying regime under Moroccan law, will have no legitimacy under the future independent Saharawi State.

The Government of the SADR has concluded this agreement with Fusion to allow the Saharawi people to independently determine the potential of their territorial waters and to then plan for responsible exploration and exploitation of these natural resources. Through collaboration with Fusion on this project, Saharawi officials will become further accustomed to the principles and standards of the international oil and gas industry in readiness to assume custodianship and management of these resources following confirmation of sovereignty. The Government of the SADR is strongly committed to the adoption of competitive and transparent licensing and tendering principles, with an economic and legislative framework designed to attract international investment and encourage activity.

The Government of the SADR has chosen Fusion as its technical partner in this assessment in view of the company's proven expertise and commitment to the region. Fusion pioneered recent deepwater exploration efforts offshore Northwest Africa, which culminated in 2001 in the first deepwater oil discovery in the region (Chinguetti-1, offshore Mauritania).

Mr Mhamed Khadad, Councellor to the President of SADR, commented:

"The Government of the Saharawi Arab Democratic Republic is pleased to have commenced this Technical Cooperation Agreement with Fusion and looks forward to using the results of the evaluation to implement appropriate policies that will encourage open competitive international investment and ensure responsible development of the offshore resources of the SADR for the benefit of the Saharawi people."

London, 27.05.02

For further details please contact:
Polisario, Kamel Fadel
Tel:    07796 553 789
Fax:   +61 2 92 83 92 70


Note for Editors:

Western Sahara is currently regarded by the United Nations to be a non-self governing

territory.  Following the end of Spanish Colonial Rule in 1975 the International Court of Justice (ICJ) rejected Moroccan and Mauritanian claims concerning sovereignty over Western Sahara.  Despite the judgment of the ICJ the territory of Western Sahara was occupied by Morocco and Mauritania in 1976.  In 1979 Mauritania withdrew all claims to the territory and recognised the SADR as the legitimate governing authority of the territory.  Following a prolonged military conflict between SADR and Morocco, the UN brokered a ceasefire in 1991 and formulated a mechanism to resolve the conflict through a UN organised referendum of the indigenous population.  The work of the UN towards conducting the referendum or otherwise resolving the issue of sovereignty is continuing under the guidance of the former US Secretary of State James Baker in his role as the UN Secretary General's Special Envoy to Western Sahara.  The SADR is a full member of the African Union and is recognised internationally by 76 countries.


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