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IFC Loan for LPG Terminal Plant in Mombasa

The International Finance Corporation (IFC) has agreed to lend $48Millionto Mombasa Gas Terminal Limited (MGT) to construct a liquefied petroleum gas (LPG) terminal in the Kenyan port of Mombasa on the coast of the Indian Ocean.

American engineering firmLloyd Jones Construction, has won the contract to build the facility, which will also have a pipeline and direct mooring access for large-sized LPG carriers. It is scheduled to commence operations in early 2020.

The terminal will feature a private berth for unloading mid-sized LPG carriers, an onshore 22,000 metric tonne capacity storage and associated infrastructure, including multiple landing points for transfer of LPG to transport vehicles.

The IFC Loan is slightly less than half of the $112Million funding for the project, which will come, in part, as equity from MGT, and in part, as loan from other lenders.

MGT is operates a fleet of 20 containers to import LPG into Mombasa on-board container vessels It is .owned by Dubai based Milio International Limited, which sells refined hydrocarbon fuels.

IFC , an arm of the World Bank group, is supporting the project because it is energy infratructure.“The aim of the project is to address issues of LPG supply and infrastructure in the Port of Mombasa to support the LPG master plan for Kenya, ” the bank says
MGT will use LPG-approved tanks to transfer the gas by trucks to the Rift Valley Railways (RVR) yard in Kilindini and the Standard Gauge Railways (SGR) yard in Port Reitz, from where the commodity will be transported to Nairobi and other parts in the country.

The company will also use LPG bullet trucks accredited by third party and contracted by customers for transport of the gas.

Environmental and social impact assessment test on the project were undertaken in February.

If You are in Oil and Gas, You Should Be Worried

The world of fossil fuel is about to change. It is changing uniquely. The world will demand far more energy than it is currently doing, while the energy mix changes.

There are people who don’t believe that the transition is happening.Concerns have risen around prospects of global warming. The Paris Climate Agreement aims to keep global average temperatures from rising by two degrees Celsius.

Flooding, melting ice….the ecosystem is changing and clean air that we take for granted in many places is now coming under very severe challenges in some areas.

→   Read the rest of this entry

JAD Attains NIS ISO 9001:2015 Certification

JAD Construction Ltd, a 100% Nigerian Local Content company that has been providing outstanding support services to the Nigerian oil and gas sector in Heavy-Lift and Jetty Management, Marine Logistics & SEWOPs and Mechanical Construction for the past Fifteen years (In its fully equipped and modern Fabrication Facility at KM 5 Warri- NPA Expressway Ekpan, Warri, Delta State, Nigeria).

JAD Construction Ltd has attained the NIS ISO 9001:2015 Integrated Management System certification for Construction Engineering and Marine Logistics.
Its quest is to become Nigeria’s premier oil and gas services company that plays a significant role in providing opportunities for the growth and development to the Nigerian economy. “Attaining conformity Management System Standards, certificates are widely used in global markets to establish confidence between business partners and between organizations and their customers, to qualify suppliers in supply chains, and as a requirement to tender for procurement contracts,” an official said.

JAD Group has acquired numerous awards for service excellence over the years from various Multi IOCs and EPC Companies. On 30th April, 2018, JAD Construction will be officially awarded the NIS ISO 9001:2015, 14001:2015 and OHSAS 18001:2007 Integrated Management System certification at Denis Hotel, Wuse 2, Federal Capital Territory Abuja, Nigeria at 1000HRS pronto “It is a rigorous audit procedure that follows the ISO/IEC 17021-1 standard to ensure competent audit teams with adequate resources that guarantees confidence among regulators in the certification body.” SON is confident to announce that JAD Construction has met all requirements for this certification.

In 1994, the Standards Organization of Nigeria Management Systems Certification Directorate (MSC) commenced certification as the Systems Certification arm of the Standard Organization of Nigeria that operates the ISO/IEC 17021 2015 standard.

For more information:

Sonangol Launches Mini Bid Round For Former Cobalt operated Tracts

Sonangol, the Angolan state-hydrocarbon company, has called for bids for its share in two offshore oil blocks, Blocks 21/09 and 20/11, which were formerly operated by Cobalt Energy, the American independent.

“For this purpose, there will be held data showrooms (data consultation sessions), from April 24 to June 29 this year, at the headquarters building of the national oil company, in Luanda”, the company says in a statement, “and from May 28 to June 1, in a place to be announced in Houston-Texas, United States of America, for sharing technical, legal and contractual information of the abovementioned blocks”.

Please see Sonangol’s full announcement in this link.

Cobalt’s announcement of the Cameia-1 discovery in Block 21/09 in February 2012, suggested that predictions of significant reservoirs below the salt layer in deepwater Kwanza Basin were not exaggerated. There were a string of other discoveries and Cobalt announced, by 2016, that there was as much as 750Million barrels of oil equivalent in those two licences.

But development of these discoveries have stalled largely due to challenges that Cobalt faced about the early local content partners in the licences.
An agreement for Cobalt to sell the licenses to Sonangol for $1.75 billion in 2016 fell through, and Sonangol declined to extend the licenses. Cobalt, which has filed for bankruptcy, took Sonangol to international arbitration over the dispute. In December 2017, few months after President Joao Lourenco took power, Sonangol announced it was settling with Cobalt for $500Million.

Sonangol holds a 30% stake in Block 20/11, BP holds a 30% stake and Cobalt International Energy held 40%; in Block 21/09, Sonangol holds a 40% stake and Cobalt holds 60%

What was formerly Cobalt Energy’s stakes have now become Sonangol’s, and are included in what is on offer.

Helge Lund, Oil Industry “Rock Star”, to Become BP’s Chairman

The man who headed BG as the company was swallowed by Shell in 2016 has been named the next Chairman of one of the world’s five oil majors.

Helge Lund will join the BP Board as chairman designate and a non-executive director on 1 September 2018. He will be appointed chairman on 1 January 2019. Mr Lund will be succeeding Carl-Henric Svanberg. He will have a base in London.

Lund, 55, has something like a rock star status in the leadership ranks of large oil and gas companies around the world. He is chairman of Novo Nordisk AS in Denmark, and “will stand down with immediate effect from his directorship at Schlumberger, the global oil service group”, according to a statement published by BP’s corporate affairs unit.

Lund served as Chief Executive of BG Group from 2015 to 2016 when the company merged with Shell. He joined BG Group from Statoil where he served as President and CEO for 10 years from 2004.

It was in his 10 years at Statoil that he made his name, transforming the company, according to several accounts, from a local operator into an important global force, active in areas such as the Gulf of Mexico and Russian Arctic. BG, desperate for a “company-builder”, to head its business after some difficult years and the forced exit of Chris Finlayson, poached Lund from Statoil in 2014, with a $17Million golden hello and other perks.

Prior to Statoil, Lund was President & CEO of Aker Kvaerner, an industrial conglomerate with operations in oil and gas, engineering and construction, pulp and paper and shipbuilding. He has also held executive positions in Aker RGI, a Norwegian industrial holding company, and Hafslund Nycomed, an industrial group with business activities in pharmaceuticals and energy.

His appointment as BP Chairman is the culmination of a thorough search conducted by the full BP Board led by Ian Davis, the senior independent director. “Mr. Davis said that the search process had been worldwide and rigorous. This produced an impressive list of diverse candidates from the UK, continental Europe and the US”, BP’s statement said.


ENI Ramps Up Zohr to 800MMscf/d

Italian giant ENI has announced the start-up of the second production unit (T-1) of the Zohr project offshore Egypt.

The unit increases installed capacity in the field by 400 MMScfd, just 4 months after the field’s start-up. Zohr now has a capacity of 800 MMscfd, equivalent to 150,000BOE per day (46,000BOPD net to ENI).

The production ramp-up is planned to continue, with the same exceptional performance, in order to reach 1.2Bc/d in May 2018, 2 Bc/d by end 2018 and the production plateau (2.7Bc/d) in 2019.

The Zohr field, the largest gas discovery ever made in Egypt and in the Mediterranean Sea, is located offshore, within the Shorouk Block, some 190 km north of Port Said. Zohr was discovered in August 2015, obtained the Development Lease approval in February 2016, and started the production in December 2017 with a time-to-market of 2.3 years.

“The latest achievement reinforces the exceptional development path of Zohr, one of ENI’s seven record-breaking projects, which is playing a fundamental role in supporting Egypt’s wish to cease LNG imports in 2018”, ENI says in a release.

ENI holds a 60% stake in the Shorouk Block, Rosneft 30% and BP 10%. In March 2018, ENI agreed to sell a 10% stake in the concession to Mubadala Petroleum. The project is executed by Petrobel, the operating company jointly held by Eni and the state corporation Egyptian General Petroleum Corporation (EGPC), on behalf of Petroshorouk, jointly held by Contractor (Eni and its partners) and the state company Egyptian Natural Gas holding Company (EGAS).

Deepwater PSCs Will Take A Hit in New Nigerian Law

Companies operating Production Sharing Contracts PSCs, in Deepwater will lose significant revenue, when all the several bits of Nigeria’s Petroleum Industry Bill (PIB) are passed.

The current Nigerian legislative houses of assembly have been far more forthcoming in the last two years to pass the bill, than any government has done since the bill was first introduced in parliament in 2008.

The incumbent House of Senate broke the PIB into four pieces of legislation, for easier passage.

There is, in both the executive and the legislative arms of Nigerian government, far more increased optimism than ever, that the laws will be passed, even as national elections are less than a year from now.

Some of the most contentious parts of the legislation have been the increase in the state’s take in deepwater licences.

Stakeholders broadly expect that there will be some loss of between 20 and 30% in the overall receipts from crude oil production by companies who are operating licences that were signed in 1993, which had very lenient financing framework in favour of operators.

“Royalties that were either close to zero or zero in some cases would now have clear values. From the day the law is passed, new royalty targets take effect”.

Overall, for acreages in shallow water and onshore, Taxation and Royalties will be generally in the same band as in the extant law and will favour Nigerian independents over International Companies.

A Fuller explanation of several implications of the PIB can be found in this link

South Africa About To Get its First Offshore Oil and Gas Services Base

Odion Max John, in Cape Town

South Africa’s National Ports Authority (TNPA) has selected a private port terminal operator to build and operate the country’s first offshore supply base (OSSB) at the Port of Saldanha, in the Western Cape.

SA’s first dedicated and customised facility supporting offshore oil and gas is to be developed by Saldehco, a South African company comprising principal shareholder HARPS Holdings Pte Limited and local partner Semona Pty Limited.

The facility, which will involve investments of some $150Million over the coming five years, will provide services to offshore oil and gas companies operating along Africa’s coastline.

Saldehco was selected following a competitive bidding process conducted by the Transnet National Ports Authority (TNPA), which is mandated to concession port terminals to private operators in line with Section 56 of the National Ports Act.
Its two partners- HARPS- has energy, property and marine interests in several countries, and -Semona Pty- is black-women-owned energy company.

As port landlord and planner, TNPA is providing berth infrastructure for the OSSB at the port’s general maintenance quay. Saldehco, meanwhile, is responsible for providing warehousing, workshops, office facilities, as well as equipment such as cranes and other rubber-tyred equipment to operate the terminal.

The OSSB will offer services to vessels supporting offshore exploration and production activities, including fabrication of offshore structures, as well as provision of marine bunkers and lubricants.

Somali Data Looks Good, But Who Will Drill It?

Sterling Energy says there are “encouraging technical indications”, from its review of the two dimensional (2D) seismic dataset acquired by the government of Somaliland, but the company’s published update on operations in the country doesn’t point to a probable time of drilling any prospect.

Somaliland is a sovereign territory outside of the war ravaged Somali.

Sterling, a 34% non-operating partner, “is undertaking a highly focused and rigorous processing effort, independent of the Operator, with the primary technical objective of improving the deeper subsurface image”, the update says. “The first phase deliverables will be a full pre-stack time migrated dataset, consisting of 3 lines of approximately 235km”.

This is about the Odewayne (onshore) Exploration Block, for which production sharing agreement (‘PSA’) was awarded as far back as 2005. That agreement is in the third period, and the government has been generous. The companies; Genel Energy, which is operator and Sterling, have not had to spend a single cent on data acquisition and they have no clear path to drilling, even after the government acquired data and handed it to them. “The minimum work obligation during the optional fourth period of the PSA (also extended by 2 years to May 2020) is for 1,000km of 2D seismic and one exploration well”.

That obligatory 1,000Km of data was acquired by the Somaliland government, rather than the contracting parties, in 2017.

There’s a lot of technical framing of a statement that’s ordinarily meant to say: “We are not ready to invest up to the drill site on this block. Read the following from Sterling’s update: “There is an option in place for a second phase of processing on the remaining 765km (13 lines) of data; the decision to progress to this optional second phase will be made once the initial deliverable have been received and assessed. This workflow will allow for an informed technical and commercial perspective on the block in H2 2018”.

Here is the thing: unless another partner comes into the block, there is no likelihood that either Genel or Sterling will drill any well here, even in 2022.

How Egypt Plans To Eliminate Electricity Subsidies Entirely By 2021

The Egyptian Government has again outlined plans to eliminate electricity subsidies, in order to allow some form of free market involving the Private sector.

This time, it pledges, it would work.

To be successful at transforming the electricity supply industry, says Mohamed Shaker, the country’s electricity and renewable energy minister, “we have to get rid of all the subsidies”.

Egypt generates 80% of its power from natural gas fired power plants, which collectively have a nameplate capacity of over 35,000MW.

“If we had gone through our plan started in 2014, we would have completely eliminated subsidies by 2019, but because of the economic reform and a large depreciation of the currency, we had to extend our five year plan by another three years”, the minister told a meeting of the American Chamber of Commerce in Cairo, the Egyptian capital. “In a short while, I will actually announce what will be the electricity price for the next fiscal year and the year after that so everybody knows what will they will be paying for electricity, though I highly recommend that you go and buy L.E.D lamps and go for energy efficiency in order to have a cut for your electricity bill.”

The Egyptian government has been gradually restructuring the tariff in the last three years, Mr. Shaker notes. “We started in 2015, the subsidies rose at that time to 27.3Billion Egyptian Pounds and this was going down if we went through our plan by the year 2018-2019 we will be reaching actually a point where we don’t have any subsidies but because of the economic change (forex deregulation) this jumped from 12.8 to 62.4Billion Egyptian pounds, which was the subsidy last year (2017).

The subsidy this fiscal year is 52.74Billion Egyptian pounds. We are trying to follow the step that by 2021 we will be completely eliminating the subsidies. This will give good chance to the private sector who will like to invest and building a real big power station so when you go to the deregulated power market it can be competitive and then he can make money from his installations”.

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