China resumed diplomatic relations with Senegal back in 2005. Since then it has lent it, on very good terms, something like $US161 million dollars. The latest loan was just this month (Jan 7th) for about $US80 million dollars.
It also recently signed a trade deal with Senegal reducing import tariffs on goods from Senegal to zero.It also announced in 2006 that it would spend $US35 million building West Africa's biggest cultural theatre in Senegal. At the same time it announced debt relief of some $US20 million.
So what has that do do with the tiny Australian oil explorer First Australian Resources?
Recently a huge oil exploration tenement in Senegal fell into the hands of FAR when its 60% USA partner, Hunt Oil, unexpectedly pulled out of the joint venture. It gave no reason and being a private company it does not have to.
This posed a problem for FAR as the lease on the tenement was also about to expire.
But against all odds the Senegal Government approved the passing of the tenement to FAR and immediately extended the lease for another 12 months to enable FAR to find a senior partner to fund the drilling at a cost of about $US60 million for the first well.
The tenement is ready to drill as over the past year or so $US20 million has been spent identifying targets.
Now Deeplode makes no assertions about this scenario...readers can do that themselves.
But this situation sure looks interesting.
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