American Texana Resources Company, licensed to explore oil in Nepal, is preparing to leave the country.
The company got a license in 1998 but suspended work in one and a half years, citing security concerns. It has not responded to the government directive to resume work. Petroleum Exploration Project Manager at the Department of Mines, Shyam Bahadur KC, said they wrote to the company four times this year but in vain. "The company has one year left for the project and it is now preparing to transfer ownership to Edinburgh-based company Cairn and leave Nepal", he said.
American Texana Resources Company had acquired a license to explore petroleum in the Nepalganj and Chitwan area 12 years ago. As per the agreement, the exploration should have been completed within four years.
Texana was also supposed to pay $100,000 annually for renting land from the government, with an additional $10 per sq km tax during exploration. The company paid rent for two years only.
Cairn is also lobbying the Nepal government for the land rented by Texana. "Seismic surveys will be difficult if we do not get the Chitwan and Nepalganj blocks leased by Texana," said an official at Cairn. "We asked the mine department and industries to lease us the land but they have been reluctant, and say giving seven blocks to one company will create a monopoly."
Cairn has leased blocks in Dhangadhi, Karnali, Lumbini, Birganj and Manlangawa for exploration, for which it pays $250,000 rent to the government annually. The company was set up in 2004. It also suspended work due to the deteriorating security situation but resumed work in 2009.