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GE Commissions Takoradi Facility

GE Oil & Gas is commissioning its new services facility in Takoradi, in Ghana’s oil rich western region, this Wednesday, March 22, 2017.

On hand will be Ghana’s top petroleum bureaucrats, led by the country’s Minister of Petroleum, and G.E’s African leadership.
The project will primarily support the ENI operated Sankofa-Gye Nyame integrated oil and gas field development, located in Offshore Cape Three Points (OCTP) block, in water depths ranging from 600 to 1,500metres.

For a duration of 15 years, the Sankofa-Gye Nyame development will drain about 400Million barrels of crude oil reserves at 50,000BOPD at peak. It will supply 180Milliion standard cubic feet of gas to the country’s burgeoning domestic market.
The crude oil phase of the development is expected to come on stream before the end of June 2017.

GE will deliver a total of 21 subsea trees (also known as Christmas Trees, or XTs) for the project –  18 for installation and three for backup. Their primary function is to control the flow – usually oil or gas – out of the wells.

The Takoradi facility received the first two XTs for the Sankofa-Gye Nyame development in the last quarter of 2016.
GE Oil & Gas will also, at this facility, support the customer’s aftermarket needs, with the facility largely responsible for site receival testing and providing support to ENI’s equipment installation campaign for the Sankofa-Gye Nyamme project. Site receival testing involves ensuring the safe arrival of equipment, flushing systems and replacing hydraulic fluids, and making sure there’s continuous, undisrupted communication between the control equipment after they have been deployed offshore.


Cameroon Will Host the World’s First Floating LNG

By Sully Manope, in Douala

Move over, Australia, the quiet Atlantic waters offshore Cameroon are steadily on course of hosting the world’s first Floating Liquefied Natural Gas (FLNG) unit.

Golar’s FLNG Hilli, currently under conversion in Singapore’s Keppel Shipyard, is close to moving to West Africa to start its eight-year contract in the second half of 2017. 

Golar, owner and operator of liquefied natural gas carriers; Perenco, the French E&P independent and Cameroon’s state hydrocarbon company Société Nationale des Hydrocarbures (SNH), are partners in the 1.2Million Tonnes Per Annum (MMTPA) FLNG Hilli, which they have been developing since November 2014.

Shell’s bigger Prelude FLNG project, planned for offshore Western Australia, took Final Investment Decision (FID) in 2011, four years earlier than the September 2015 FID for FLNG Hilli. But Prelude FLNG is a 5.3MMTPA project with all the issues of a large LNG facility. With 488m in length and 74m in width, it is the largest facility of its kind. It will monetize the resources in the 3Tcf Prelude natural gas field, discovered in 2007. Partners in the project include Shell, 67.5%, INPEX, 17.5%; KOGAS, 10% and CPC, 5%.

Golar has spoken with certainty about the scheduled delivery of the conversion project and claims it is within its $1.2Billion budget. Shell speaks less of timing of delivery and more of the might of the Prelude: ”Hundreds of engineers from across the world have combined their experience and expertise to design the world’s largest floating offshore facility”, the company says on its website. “It will be used to help open up new natural gas fields at sea that are currently considered too costly or difficult to develop”. Prelude FLNG is said to be the largest of its kind, but the world, really, does not yet know of any stationary gas floater! Module installation work for the Prelude FLNG has been completed at Samsung Heavy Industries’ Geoje shipyard in South Korea and, in the words of the JGC, which is contracted to support the completions work for the FLNG’s safe and on-schedule completion, ”commissioning is well and truly underway.” Still, it is likely that this project is not commissioned until the third quarter of 2017.

The Cameroon project is based on the allocation of 500 Bcf of natural gas reserves from offshore Kribi fields, which will be exported to global markets via the FLNG Hilli. The 1.2MMTPA of LNG, represents approximately 50% of the vessel’s nameplate production capacity.


Nigeria’s Newest Indies Produce Close to 200,000BOPD

By Toyin Akinosho, in Lagos

Three Nigerian independents Aiteo, Eroton and Newcross, collectively produced close to 200,000Barrels Per Day at peak, close to the end of 2016.

These companies, each of which emerged less than four years ago, are the newest beneficiaries of the divestment programme of the oil majors operating in the country.

Aiteo Eastern E&P, the operator of the Oil Mining Lease (OML) 29, reported gross production of 92,000BOPD in October 2016, figures in NNPC’s December 2016 report show. Eroton E&P, in OML 18, averaged 63,764BOPD gross output in the same month. There were no figures published for Newcross in October 2016 and November 2016, (the last months for which figures are officially available), but the company, operator of OML 24, delivered 30,213BOPD in September 2016.

These figures come to about 186,000BOPD, roughly 10% of the country’s average 2016 production and are less than half of what the 22 Nigerian owned producers of crude oil and gas are capable of delivering.

Indeed, the five similar Nigerian independents, including Seplat, Shoreline Natural Resources, NDWestern, Elcrest and First Hydrocarbon Nigeria, who have had up to 80% of their production shut-in for more than 12 months by the damage to the TransForcados pipeline, were collectively producing over 160,000BOPD before the bombing. Seplat and Neconde alone were averaging 115,000BOPD prior to the February 14, 2016 outage.

Analysts however say that Nigerian owned oil producing companies have not historically been consistent in maintaining, let alone increasing production. Conoil, which produced around 45,000BOPD in 2005, and now delivers less than 10,000BOPD, with four acreages, is proof of this assertion.

“Poor governance is part of the challenge”, says Sam Ojehonmo, an Africa focused energy consultant based in Cairo, “but these new breed of operators have a different challenge; they took huge loans to buy the assets; the earlier generation had the assets largely handed over to them gratis, and they were cash flush when they had to bid for another round of acquisitions”.

Aiteo, Eroton and Newcross took over their assets from the consortium of Shell, TOTAL and ENI between 2014 and 2015, paying a total of $4.1Billion for the consortium’s 45% share, with the state hydrocarbon company, NNPC holding the remaining 55%. “We are a strategically important Borrower to the Nigerian banking industry”, Chike Onyejekwe, Group Managing Director of Aiteo, told an industry summit a fortnight ago in Abuja.


Petrodata Achieves ISO 27001:2013 Certification

Petrodata Management Services Limited (PMSL) is the first multi-clientele Storage Data Centre in West Africa, a wholly owned Nigerian company incorporated in 1994 with a share capital of N250 Million out of which N185 Million has been fully paid up; today announced that it was awarded the International Organization for Standardization (ISO) 27001 certification.

The ISO 27001:2013 certification includes the provision of data management services, encapsulating Cloud Services & disaster recovery; Electronic document Management systems (EDMS); Software Services (PSS), Colocation services; Data Storage, Data Transcription and Well Log Digitization Services.

ISO 27001:2013 is a global security standard that sets out requirements for an Information Security Management System. Petrodata’s compliance with the ISO standard was certified by DAS Certification – Member of United Kingdom SN Registrars (Holdings) Limited. It validates the company’s strong commitment to the ongoing maintenance and development of its Information Security Management System (ISMS), making information security and data protection an integral part of all its business processes.“The ISO 27001 Certification aligns with our strategic vision for Petrodata as a Storage and Data Management Service provider,” said Wole Shebioba, Managing Director of Petrodata.

We are honored to have earned this certification, demonstrating that our highest level of controls is in place when handling client’s confidential information.

Petrodata is continuing its commitment to provide further assurance of security controls and practices has established a governance program that includes the Management Committee whose job is to support the ongoing security improvements since we believe the “race for quality has no end”.


Nigeria’s Senate Says Four Petroleum Laws Will Be Passed in 2017

The upper house of the country’s bicameral legislature, the Senate, will pass all the four petroleum reform bills replacing the Petroleum Industry Bill before the end of the year, a ranking legislator has said.

“We will lay down the third reading of the Petroleum Industry Governance Bill (PIGB)sometime in March and possibly pass it by April 2017”, David Alasoadura, Chairman of the Upstream Petroleum Committee in the Senate, said in response to a question by Africa Oil+Gas Report at the Nigeria Oil and Gas (NOG) conference in Abuja last week.

The PIGB is the first of four bills which replace the Petroleum Industry Bill (PIB), which has been under deliberations since 2008. “The third reading is the last of the readings; it’s the nut and bolt reading”, he said.

The house is looking forward to fast track the passage of the three other bills; including the Petroleum Fiscal Reform Bill and the Host Community Bill. “We plan to combine two of the three remaining bills so that we can pass all the bills before the end of the year,” Alasoadura said.


Nigeria’s LPG Consumption Inches to 500,000Metric Tonnes Per Annum

Consumption of Liquefied Petroleum Gas (Cooking Gas), reached 500,000Metric Tonnes in 2016, according to Dapo Adesina, Chairman of the Nigeria Liquefied Petroleum GAS Association.

It was the first year in which the Nigerian Liquefied Natural Gas (NLNG), which has been the main supplier of the fuel since 2004, broke even on the project.

The company provided 350,000 Metric Tonnes, or 70% of the consumption, in 2016. Other suppliers included NNPC refineries , but the consumption is still far short of the World Bank estimated market potential for the country which, as far back as 2004, was 3.2Million Tonnes Per Annum.

NLNG was instructed by the government of President Olusegun Obasanjo administration to start supplying the market in 2003, by which time the refineries had almost entirely ceased supplies and there was a near zero supply to the market, leading, itself, to significant reduction in demand.

The NLNG intervention, which started with 70,000Metric Tonnes Per Year allocation, thus guaranteed some security of supply, which led to increased demand from what was clearly a low base.

By 2012, the company had increased its allocation to 150,000 Metric Tonnes. It increased to 250,000 Metric Tonnes in 2013 due to growing demand.


Ophir Says Fortuna LNG Will Be One of A Handful of FIDs in 2017

Ophir Energy says that Final Investment Decision for Fortuna “will be one of a handful of global FIDs of a green-field LNG project in 2017”.

Fortuna is located offshore Equatorial Guinea. In November 2016, Ophir signed a Shareholders’ Agreement with OneLNG in November 2016 for the formation of a Joint Venture that will develop and finance the Fortuna FLNG project.
Ophir is excited that the establishment of a Joint Venture with other partners “means we can now move the Fortuna FLNG Project towards FID in mid-2017. At FID, the project NPV will be a healthy multiple of the $120Million of capital we are committing before first gas”

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VOG Adds Bomono to the Douala Gas Network

Victoria Oil & Gas (VOG) Plc is on course of extending its gas network in Cameroon to include gas to be produced from the Bomono production sharing contract (Bomono PSC).

The company signed a farm-in agreement with Bowleven plc, operator of the Bomono PSC, which allows that gas produced from the Bomono PSC will be fed into the customer distribution network owned and operated by Gaz du Cameroun S.A. (“GDC”), a wholly owned subsidiary of VOG.

In the event, VOG will have 80% working interest in Bomono PSC.
VOG currently runs a 7Million standard cubic feet of gas per day (7MMscf/d) network which feeds power plants and industries in the city of Douala, the commercial hub of Cameroon.

“First gas supply to the GDC network is anticipated to start following granting of a Provisional Exploitation Authorisation (“PEA”) and other approvals”, Bowleven notes in a statement. “This Agreement, which has been negotiated by the parties over several months, aligns Bowleven’s intention of realising near term value from Bomono through commercial production of its Bomono gas deposit with VOG’s business of commercialising local onshore gas deposits using its established gas infrastructure and customer network”, the company explains, adding: “The transaction provides the ability to minimise the timescale to first production and optimises the proven advantages of Bowleven’s upstream expertise and VOG’s established gas supply business that feeds a diverse range of industries and the local power grid.

The initial plan is that gas currently suspended at Moambe be brought onstream and that further drilling be considered to supply the growing domestic market in and around the Douala area.

Farm Out Highlights
On completion, EurOil Limited (“EurOil”), a Bowleven subsidiary, will have a 20% working interest in the Bomono PSC and GDC Bomono S.A. (“GDC Bomono”), a wholly owned VOG subsidiary, will have an 80% working interest.
Bowleven will remain as operator of the project.

Gas from Bomono PSC will be sold to GDC less a tolling fee. The gas price paid will be a weighted average received by GDC for its total domestic sales less a tolling fee for use of the pipeline network.

The pipeline connection from the Bomono PSC to the main network will be managed and funded by GDC. GDC Bomono will complete the civil engineering works necessary for the gas processing plant installation at the Bomono site. The estimated capital cost for these works is US$6 million.

Bowleven has agreed to pay GDC Bomono 50% of any deficit, limited to a maximum payment of US$2 million, if the first 3 years of net income received by GDC Bomono is less than the development expenditure incurred.

EurOil will receive a 3.5% royalty from GDC Bomono’s production share of hydrocarbons, with an aggregate cap limiting the total royalty payments to US$20 million.

Bowleven will, on completion, also receive £100,000 worth of new ordinary shares in VOG based on the volume weighted average share price 10 days preceding the date of the Agreement, being 69.23 pence per share. It is the intention of Bowleven to retain these shares initially, but keep that decision under regular review as there are no restrictions on their disposal.
Asset Details:

The farm-out transaction relates to the Bomono PSC, onshore Cameroon. EurOil is operator of the Bomono PSC.

Bowleven completed extended well flow tests on the Moambe well that exceeded 7mmscf/d. The Moambe and Zingana exploration wells drilled at Bomono were then suspended as future producers.

As previously announced by Bowleven, the detailed prospect inventory prepared indicates there is 146bcf and 263bcf of mean un-risked GIIP in the Tertiary and deeper Cretaceous reservoir intervals respectively.

Additional Transaction Details:
The economic effective date of the transaction is 1 January 2017.
The above interests are expressed prior to the exercise of any back-in rights by the Cameroon State. Under the terms of the Bomono PSC, the Cameroon State has the right to take a 10% participating interest in development activity undertaken under an exploitation authorisation.

Completion is subject to, amongst other things:
The grant of a PEA over the Bomono PSC. The PEA application was submitted by Bowleven to the Cameroon authorities as requested following Ministerial approval for the award of a two-year extension to the Bomono PSC (to 12 December 2018);
The approval by the Cameroon Government of the assignment of the equity interest from EurOil to GDC Bomono; and
Should these conditions precedent not be satisfied by 30 June 2017, both Bowleven and VOG have the right to terminate the Agreement.

In the event that any of the resolutions requisitioned by Crown Ocean Capital P1 Limited at the forthcoming Bowleven General Meeting on 14 March 2017 are passed, VOG has the right to terminate the Agreement.


Three New Plants Add 270MMscf/d Capacity to Nigeria’s Domgas Market

By Toyin Akinosho, in Abuja

The Utorogu NAG 2 Plant, a 150MMscf/d capacity gas plant to process Non Associated Gas on the Utorogu field in Oil Mining Lease (OML) 34, has been commissioned.

The Oredo-Obale gas pipeline has been completed, so the 80MMscf/d Oredo gas plant can now supply gas. Also on stream is a 40MMscf/d capacity gas processing plant on the Odidi field in OML 42, the first of two phases, according to David Ige, who was Executive Director in charge of Gas and Power at the NNPC until May 2015.

The combined 270MMscf/d capacity was unlocked between December 2016 and February 2017. Nigeria can certainly do with this volume in its domestic gas market, especially for power, where gas supply has been severely constrained.

But Layiwola Fatona, Chief Executive Officer of the NDWestern Limited, a Nigerian upstream independent which holds 45% equity in the Utorogu NAG 2 plant, says that questions about gas plant commissioning are not the right ones to ask at this time.

“So what? Are you paying for the gas taken and not paid for?” he asks a reporter with Africa Oil+Gas Report. “What is the big deal about commissioning NAG2. Or NAG 3, when no one will pay for the gas being taken?”
Gas producers in Nigeria have, of recent, complained about lack of payment for gas supply to power plants mostly owned by the government.

Dr. Fatona queries: “Are we running a Father Christmas enterprise?”


SDX Moves to Drill SD 1X

London headquartered SDX is mobilising the Sino-Tharwa 6 drilling rig to the location of South Disouq (SD)1X, its first well in the South Disouq licence onshore.  

The Company anticipates drilling to commence at the SD-1X location by March 20, 2017.
SDX is 55% operator of the South Disouq licence, an exploration asset located onshore central Nile Delta. IPR Group of companies holds the remaining 45%.

The South Disouq concession spreads over 1,275 sq km and is estimated to contain 1.3 TCF of resource potential (P10). The concession is located within the prolific Abu Madi – Baltim trend which to date consists of 10 discoveries containing 6.3 TCF of gas and 100 MMBO of liquids.

The company also has a working interest in two producing properties (50% North West Gemsa & 50% Meseda) located onshore in Egypt’s Eastern Desert, adjacent to the Gulf of Suez.

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