Topics CoveredWelcome to ChadOverview of ResourcesIndustrial Minerals and GemstonesFossil FuelsInvestmentSources
Welcome to Chad
Chad is a landlocked nation located south of Libya in Central Africa. The total area of the country is 1.284 million km2, and it has a population of 10,975,648 as of July 2012. The country’s climate varies from tropical in the south to desert type in the north.
|The national flag of Chad.|
Image Credit: CIA Factbook.
After decades of civil war and invasion attempts by neighboring country Libya, Chad regained stability in the 1990s. However, there were several cases of rebellion that disrupted the progress of the nation. Owing to the peace agreement with neighboring Sudan, sporadic violence has almost stopped since 2010.
Despite the fact that Chad’s economy is primarily dependant upon agriculture, large global companies are showing a great deal of interest in Chad’s oilfields and several foreign direct investment projects have been operating since 2000. The nation requires foreign assistance and capital to develop new projects. The GDP of the country in 2011 was $19.79 billion.
Chad’s natural resources include petroleum, gold, natron, uranium, limestone, sand, gravel, kaolin and salt. Its mining sector is yet to develop to its fullest potential.
Overview of Resources
Chad’s mineral industry is monitored by the Ministère des Mines et de la Géologie and the Ministère du Pétrole et de l’Énergie and is regulated by the Mining Code.
Production of hydrocarbons dominated Chad’s economy in 2011. The other mineral commodities produced that year included gold, lime, limestone, soda ash, cement, clay, salt, sand, and stone. Most of these were produced by small-scale local mining companies. The exploration and production of crude oil was handled mostly by foreign companies.
The map of Chad. Image Credit: CIA Factbook
Industrial Minerals and Gemstones
In 2011, Chad’s first cement plant began operations. The 200,000 Mt/yr-capacity plant is owned by Ciment du Tchad and would likely ease Chad’s dependence on imported cement.
Chad’s total oil reserves are estimated to be about 1.5 bbl.
Djermaya petroleum refinery, which is the country’s first petroleum refinery, is owned by a joint venture consisting of Société des Hydrocarbures du Tchad S.A. and CNPC International (Chad) Ltd. Experts believe that the output from the Djermaya oil refinery will help reduce Chad’s dependence on imported petroleum products.
The oil sector has managed to attract several foreign investors. Recent reports state that global giant Glencore has invested $331 million in many of Chad’s oilfields. Other international companies operating many oil fields in Chad are as follows:
- Petronas of Malaysia
In 2011, Esso Chad expanded its production capacity by drilling 69 more oil wells. In total, the company operated 633 production wells in Doba Basin oilfields region.
In the same year, Overseas Petroleum Investment Corp. (OPIC), a subsidiary of CPC Corp., Taiwan, drilled a new oil reservoir. Based on exploration studies, the company estimated that the reservoir contained 100 million barrels of crude oil. OPIC also planned to conduct exploration drilling activities on the BCOIII, the BLT1 and the BCSII concessions.
As Chad’s oil sector is stable and progressing well, the government of Chad is now trying to promote mineral exploration in the metal mining sector.
Some hindrances to speedy economic growth in Chad are as follows:
- Landlocked location
- High energy costs
- Instability due to the presence of armed rebels
Currently, mineral commodities have to be trucked all the way to seaports in Cameroon and Nigeria. Hence, the government will have to find other means of transport to reduce transportation costs and boost the mineral sector.
Disclaimer: The Author of this article does not imply any investment recommendation and some content is speculative in nature. The Author is not affiliated in any way with any companies mentioned and all statistical information is publically available.