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Chad Lifts CNPC Suspension

Reuters (10/22/2013)

Chad has allowed China National Petroleum Corporation to resume operations suspended in August for violations of environmental standards while drilling for oil in the south of the country.

Oil Minister Djerassem Le Bemadjiel halted CNPC's activities after witnessing what he described as "flagrant violations of environmental standards" at its Koudalwa field, about 200 km (124 miles) south of the capital, N'Djamena.

The decision was sent to CNPC in a letter that Djerassem wrote on Oct. 16, seen by Reuters on Tuesday.

An oil ministry source, who asked not to be named, said the authorisation came after CNPC improved its environmental practices: building an incinerator to destroy waste and purchasing a truck to transport sludge collected during the drilling process.

In the letter, the ministry called on CNPC to strictly respect environmental rules, in particular those concerning the management of waste.

The dispute is the latest in a rocky relationship between Chad and CNPC, which has been operating in the country since 2003 and recently won rights to begin exploration on new blocks.

The government shut down their 588 million-euro ($804.12 million) joint-venture refinery for several weeks in January 2012 in a row over the price of fuel for the local market. The plant produces 20,000 barrels per day.

In the wake of CNPC's recent suspension, Chad ordered an environmental audit of all oil explorations in the country to check that rules were being respected.

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