By Alain Iloniaina
ANTANANARIVO (Reuters) - A private company in Madagascar said on Friday it had produced oil at an onshore pilot project in the north-west of the Indian Ocean island.
It was Madagascar's first production in 60 years and came at a time when record high oil prices and an easing of restrictions make Madagascar attractive for foreign companies.
"OMNIS (the government's Office of National Mines and Strategic Industries) and Madagascar Oil today announce the first oil production from the steam injection pilot project at the Tsimiroro heavy oil field," the Houston-based company said.
With an estimated 0.6 billion barrels of recoverable reserves, Tsimiroro is one of two heavy oil projects that Madagascar Oil is developing on the island.
"The observed rates are in alignment with our early views of productivity," Madagascar Oil general manager in Antananarivo, Alvaro Kempowsky, said in a statement.
"The company originally estimated in 2006 a potential rate of 1,000 barrels of oil per day for 10 wells producing from the whole reservoir section," the statement published in Malagasy newspapers said.
A single well was producing an initial flow rate of 65 barrels per day "of fluid" with a net 45 barrels of oil per day, and more steam injections were planned, the statement said.
The company says its other heavy oil project at Bemolanga, also in north-west Madagascar, is one of the largest undeveloped bitumen reserves in the world with an estimated 9.8 billion barrels of recoverable oil reserves.
The world's largest producer of vanilla, Madagascar, is ranked 143 out of 177 on the United Nation's 2007 Human Development Index, with an estimated 85 percent of the 20 million population living on less than $2 per day in 2005.
Madagascar has issued a total of 19 permits for onshore oil exploration, which stretch along the western coast, according to figures from last August.
Large companies, such as ExxonMobil, are also looking for oil and gas offshore, while an incipient mining boom in Madagascar is set to include nickel, cobalt, bauxite and ilmenite in the coming years.
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