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Offtakers Secured For 15MMTPA LNG on Mozambique’s Mamba Fields

By Toyin Akinosho

FID expected in 2019. First Gas Likely By 2024

Italian explorer ENI and US major ExxonMobil, say they have, along with co-venturers, secured sufficient offtake commitments “from affiliated buyers of the co-venture parties to move towards a final investment decision for the Rovuma LNG Project in Mozambique’s Area 4”
This is a “key milestone enabling the participants to rapidly move toward a final investment decision in 2019 on the first phase of the Rovuma LNG project. Area 4”, ENI says in a release. Participants are ExxonMobil, ENI, the China National Petroleum Corporation, Empresa Nacional de Hidrocarbonetos, Kogas and Galp.

“Those commitments are subject to the conclusion of fully-termed agreements, which will be finalized and initialed in the next weeks, with the approval of the Government of Mozambique”, ENI explains.

“The Rovuma LNG marketing team has worked at an accelerated pace to reach this important milestone, a tremendous achievement made possible by the strength of the Area 4 co-venture parties and the support of the Government of Mozambique,” adds Peter Clarke, president of ExxonMobil Gas and Power Marketing Company.

In July 2018, Mozambique Rovuma Venture submitted the development plan to the Government of Mozambique for the first phase of the Rovuma LNG project, which will produce, liquefy and market natural gas from the Mamba fields located in the Area 4 block offshore the Rovuma Basin in Mozambique. ExxonMobil will lead construction and operation of natural gas liquefaction and related facilities on behalf of the Area 4 joint venture,

while ENIwill lead the construction and operation of the upstream facilities.
The development plan for the first phase of the Rovuma LNG project specifies the proposed design and construction of two liquefied natural gas trains, which will each produce 7.6Million tons of LNG per year. Mozambique Rovuma Venture is currently holding productive discussions with the Mozambican Government on development plan details.

Massimo Mantovani, ENI chief gas and LNG marketing and power officer, said: “these commitments are an important step forward for the Rovuma LNG project and provide a solid foundation for securing project financing. This achievement highlights the strength of our partnership and commitment to developing Mozambique’s natural resources.”


Ophir Waits on Malabo For Fortuna Block Extension

Ophir Energy is hoping that the Equatorial Guinea authorities would grant its request to extend the Block R licence, despite the government’s earlier pronouncement that it could replace the company with other investors.

Block R, offshore Rio Muni Basin, hosts the Fortuna Field, which Ophir has hoped to monetise by installing a Floating LNG.

The company “announces that it is still awaiting a response from the Equatorial Guinea Ministry of Mines and Hydrocarbons (‘MMH’) with regards to its request for an extension of the Block R licence”, the London listed explorer says in a statement.

For more than three years, Ophir has struggled, fruitlessly, to raise the money for installing the Floater, despite announcing that most of the 2.2Million Tons Per Annum of LNG had found an offtaker.

After the mighty Schlumberger pulled out of the OneLNG joint venture with Golar LNG Partners for the project, Gabriel Lima Obiang, the Equatoguinean Minister of Mines and Hydrocarbons (MMH), noted that the government could bring in some other investors to the project to replace Ophir. He referenced the expiration of the Block licence at the end of 2018.

Ophir’s most recent statement, released December 31, 2018, however says: “We continue to engage with the MMH as well as potential investors in the Fortuna Development.  We expect to receive further communication from the MMH in January concerning either the lapse of the licence or the terms of any extension and will update shareholders as soon as the situation is clarified.

“The Board remains focused on implementing the strategy outlined in its announcement on 13 September and is proactively evaluating the options available to the Company to maximise value for shareholders for the rest of the portfolio”.

 


Fortress-Sellyfak Muscles into Ghana’s Oil Patch

Fortress Sellyfak has joined the list of local engineering service companies, poised to take advantage of the growing upstream hydrocarbon industry in Ghana.

The country is on course of producing in excess of 200,000Barrels of Oil Per day in 2019, with close to 200Million standard cubic feet of gas per day, three times the import of gas from Nigeria.

These fluids are produced from Tullow Oil operated Jubilee field, Greater Jubilee and TEN cluster of fields as well as the ENI operated Sankofa-GyeNyamme fields,

“Fortress-Sellyfak is a joint venture company specialized in Asset Integrity Maintenance,  Fabrication & Manufacturing and Equipment Rental in the Ghana Oil & Gas market”, the company says on its website. “Our cutting-edge technologies, inspiring workplace and ‘’can do’’ attitude endear our clients and attract the industry’s leading innovators”, it adds.

Ghana has witnessed three FPSOs commissioned on the three producing properties the 11 years since the first major oil discovery was made. A fourth FPSO is expected to be installed between 2022 and 2023 when Aker Energy commissions the Pecan Field.

Field optimisation, asset maintenance and field development opportunities make Ghana a very attractive place for this new company.


TOTAL looks to Final Investment Decision on Preowei in 2019

By Moses Akin Aremu, in Uyo

TOTAL is working up the Preowei structure in the vicinity of the Egina Field, which is about fully coming on stream sometime this week.

The Preowei accumulation, located north eastwards, was discovered in 2005.

“A great upside potential nearby (Egina) still needs to be developed and we are studying in particular Preowei discovery tie-back to the Egina FPSO,” TOTAL officials say. “An investment decision is scheduled for 2019”, they add,

Preowei is expected to produce around 70,000BOEPD at peak. The field will be developed as a tie back to the Egina FPSO, the largest deepwater floater that TOTAL ever deployed.

The aggressive French major began to talk up the possibility of producing Preowei in December 2017 when, after drilling Preowei-3, it reported an addition of approximately 80 to 100 Million barrels of oil (MMbo) to the full field contingent recoverable resources, bringing them to 140 to 200MMbo.

The Preowei-3 well, drilled to a final depth of 3,235 meters, encountered approximately 50 metres net of high-quality oil-bearing sandstone reservoirs, in line with expectations. The well confirmed previous results from the Preowei-1B and Preowei-2 wells, which encountered approximately 55 metres of oil-bearing sandstone reservoir.

The company is paying close attention to bottomline. “Egina will significantly boost the Group’s production and cash flow from 2019 onwards, and benefit from our strong cost reduction efforts in Nigeria where we have reduced our operating costs by 40% over the last four years,” a company statement says.


Egina To Start Pumping This Week

TOTAL expects to start up production from the Egina field, offshore Nigeria before the end of this week, most likely by January 3, 2019.

It is official.

The company’s second large deepwater oil project to be commissioned in Africa in the space of six months, the field will produce, at plateau, about 200,000 barrels of oil per day, a figure higher than 10% of Nigeria’s production.

It is however scheduled to start around 170,000BOPD.

The first Egina production well was opened on the South loop on December 29, 2018.

The field is located under 1,600 meters of water, 150 kilometres off the south eastern coast of Nigeria.

TOTAL says that the Floating Production Storage and Offloading (FPSO) unit used to develop the field is the largest one it has ever built. This project has also involved a record level of local contractors. “Six of the eighteen modules on the FPSO were built and integrated locally, and 77% of hours spent on the project were worked locally”, TOTAL officials explain, adding that start-up has been achieved at a significant cost below the initial budget, “due in particular to excellent drilling performance where the drilling time per well has been reduced by 30%”.

Initially discovered in 2003, the Egina field is the second development in production on the Oil Mining Lease (OML) 130 following the Akpo field which started-up in 2009. The Preowei field

is another large discovery made on this prolific block for which an investment decision is

scheduled for 2019.

TOTAL Upstream Nigeria Limited operates OML 130 with a 24% interest, in partnership with

Nigerian National Petroleum Corporation (NNPC), South Atlantic Petroleum – SAPETRO

(15%), CNOOC Limited (45%) and Petrobras Oil and Gas BV (16%).


2019: There Will Be A Ooomph, if not A Bang

There should be a faster tempo of upstream activity on the continent in 2019, if crude oil price stops heading downhill.

We expect increased drilling (exploratory and infill), increased seismic coverage (exclusive and multi-client) and a significant upturn in field optimisation.

The big new projects may not all start to happen as we have anticipated, but the creep that attended 2018 should turn to a mild rush.

If there is one thing that 2018 taught us, here in the newsrooms of the 17 year old Africa Oil-Gas Report, it is that the price of crude oil doesn’t have the be-all and end-all effect on final investment decisions of major hydrocarbon projects in Africa.

This time last year, we wrote that a $60-65 per barrel regime was good enough for a number of large projects, held up since the price crash of 2014, to reach financial close. The prices held firm, even did better than anticipated, yet the projects didn’t happen. Governments and other circumstances, more than anything else, cramp the syle.

Government’s interest and preparedness affected the pace of two large projects in Nigeria; a large deepwater oil project as well as the largest LNG project on the continent.

That said, let us turn the pages of the December 2018 edition of Africa Oil+Gas Report and look at a number of intended projects and activity. Our theme is Who is doing what and where in 2019: and it compiles short summaries of bid rounds, exploratory activity, field development work,  and financial sanctions, all over, from Algeria to Zambia.

Click here for your copy.

The Africa Oil+Gas Report is the primer of the hydrocarbon industry on the continent. It is the market leader in local contextualizing of global developments and policy issues and is the go-to medium for decision makers, whether they be international corporations or local entrepreneurs, technical enterprises or financing institutions. Published by the Festac News Press Limited since November 2001, AOGR is a paid subscription based monthly, hardcopy and pdf publication delivered around the world. Its website remains www.africaoilgasreport.com and the contact email address is info@africaoilgasreport.com. Contact telephone numbers in our West African regional headquarters in Lagos are +2347062420127, +234803652979, +2348023902519.

 See you on 2019.

-Editor

 

 

 

 


Will Brulpadda, Now Spud, Open Up South Africa?

The potentially game changing well is being drilled in the Outeniqua Basin

Four years after it was forced to quit, TOTAL has re-entered the Brulpadda-1AX on Block 11B/12B offshore South Africa.

The French major looks forward to drilling results, in what it considers a “basin-opening opportunity”, in the first quarter of 2019.

TOTAL halted drilling of the well in November 2014 because of mechanical problems on the rig, caused by the challenging environment in the Agulhas, with its chaotic combination of currents, waves and winds, which contrasts sharply with the mild metocean conditions of the West African deepwater.

Block 11B/12B is located in the Outeniqua Basin, approximately 175 kilometers off the southern coast of South Africa. The area has a proven petroleum system from the nearby Sable and Oryx oil fields, according to geoscientists working on the prospect. Brulpadda is one of five similar submarine fan prospects with direct hydrocarbon indicators defined utilizing two dimensional (2D) seismic surveys acquired across the Paddavissie Fairway in 2001 and 2005. The Brulpadda Prospect has gross prospective resources of more than 500Million barrels with significant follow-on potential in the success case.

TOTAL is drilling in South Africa at a time of significant uncertainty around oil and gas exploration in the country, with an Upstream Petroleum law stuck in parliament over 10 years with no clear line of sight to resolution. But if the well turns out to be a discovery in an otherwise barren landscape, it has the tendency to kickstart a drilling queue.

Brulpadda-1AX is being drilled in 1,432 metres of water by the Odfjell Deepsea Stavanger semi-submersible rig to a total depth of 3,420 meters subsea. The well will test the oil potential in a mid-Cretaceous aged deep marine fan sandstone system within combined stratigraphic/structural closure. Drilling and evaluation of the well is expected to take approximately 85 days with a gross budget of approximately US$154 million, including contingency for downtime due to weather.

TOTAL operates Block 11B/12B with a 45% interest in Block 11B/12B, while Qatar Petroleum and Canadian Natural Resources Limited have 25% and 20% interests, respectively.

 


BP Sanctions the Third Floating LNG Plant off Africa

By Toyin Akinosho, Publisher

BP has announced the agreement, with its partners, for Final Investment Decision (FID) for Phase 1 of a Floating LNG project in two fields straddling Senegal and Mauritania.

It will be the third floating LNG plant offshore Africa, coming after the Perenco operated  2.4MMTPA Hilli Episeyo FLNG, located  on the Atlantic offshore Cameroon, which came on stream last June and the ENI operated 3.3MMTPA Coral South FLNG, to be sited on the Indian Ocean offshore Mozambique. Construction of the Coral South Vessel has begun.

The FID for BP operated Greater Tortue Ahmeyim development was made following agreement between the Mauritanian and Senegalese governments and partners BP, Kosmos Energy and National Oil Companies Petrosen and SMHPM.

The project will produce gas from an ultra-deepwater subsea system and mid-water floating production, storage and offloading (FPSO) vessel, which will process the gas, removing heavier hydrocarbon components. The gas will then be transferred to a floating liquefied natural gas (FLNG) facility at an innovative nearshore hub located on the Mauritania and Senegal maritime border. The FLNG facility is designed to provide circa 2.5Million tonnes of LNG per annum on average, with the total gas resources in the field estimated to be around 15Trillion cubic feet. The project, the first major gas project to reach FID in the basin, is planned to provide LNG for global export as well as making gas available for domestic use in both Mauritania and Senegal.

The parties will continue to finalise agreements and obtain final regulatory and contract approvals, following which Phase 1 of the development will move into a detailed design and construction phase, with award of engineering, procurement, construction and installation (EPCI) contracts.  Project execution activities are expected to commence in 1Q 2019. First gas for the project is expected in 2022. Following a competitive process involving all partners, BP Gas Marketing has been selected as the sole buyer for the investor partners’ LNG offtake for Tortue Phase 1.

 

 

 


16 Companies, Including BP, Exxon and TOTAL, Apply For Five Ghanaian Acreages

Sixteen (16) companies, including five majors, submitted a total of sixty applications for the five acreages on offer in Ghana’s First Licencing Round.

The Ministry of Energy (MoE) describes these companies as “high calibre companies with proven track records”, and sees their interest as “a vote of confidence in the Ghanaian economy”.

The applications, opened publicly Friday, December 21, are for prequalification for Expression of Interest (Eol) for competitive bidding for three Blocks (GH_WB_02, GH_WB_03 and GH_WB_04) in the Western Basin and direct negotiations in respect of two Blocks (GH_WB_0S and GH_WB_06), all offshore the Republic of Ghana.

Two of the applications were invalidated as they were for Block GH_WB_01 which has been reserved for the Ghana National Petroleum Corporation (GNPC).

“In line with this, fifty eight (58) valid applications will be considered for the next stage of the process”, the Ministry says.

The applicants include ENI, Cairn, Harmony Oil and Gas Corporation, ExxonMobiL, CNOOC, Qatar Petroleum, BP, VITOL, Global Petroleum Group, Aker Energy, FIRST E&P, Kosmos, Sasol and Equinor.

“Government is determined to use a transparent process as specified by law to shortlist companies that have the capacity and will qualify based on prescribed criteria” said Mohammed Amin Adam, the country’s Deputy Minister of Energy.

“We will collaborate and partner with them to explore and exploit the resource for our mutual benefit and most importantly the benefit of the Ghanaian people” said Lawrence Apaalse, Chairman of the Licensing Round Committee.

 

 


Africa Energy Completes Farm in to South African Block

Africa Energy Corp. has received governmental approval and closed the previously announced transactions to acquire an effective 4.9% interest in the Exploration Right for Block 11B/12B offshore South Africa.

The company will thus partner with French major TOTAL, Qatar Petroleum and Canadian Natural Resources to, among other things, spud the Brulpadda-1AX well, scheduled for late December 2018

Africa Energy holds 49% of the shares in Main Street 1549 Proprietary Limited (“Main Street 1549”), which has closed separate farmin transactions with TOTAL E&P South Africa BV, a wholly-owned subsidiary of TOTAL SA, and CNR International (South Africa) Limited (“CNRI”), a wholly-owned subsidiary of Canadian Natural Resources Limited, to acquire 5% from each for an aggregate 10% participating interest in Block 11B/12B (4.9% net to Africa Energy).

Block 11B/12B is located in the Outeniqua Basin approximately 175 kilometers off the southern coast of South Africa. The block covers an area of 18,734 square kilometers with water depths ranging from 200 to 2,000 meters.  After closing, Total, as operator, will have a 45% interest in Block 11B/12B, while Qatar Petroleum and CNRI will have 25% and 20% interests, respectively.

The Brulpadda-1AX exploration well will be drilled in 1,432 meters of water by the Odfjell Deepsea Stavanger semi-submersible rig to a total depth of 3,420 meters subsea. The well will test the oil potential in a mid-Cretaceous aged deep marine fan sandstone system within stratigraphic closure. Drilling and evaluation of the well is expected to take approximately 85 days

 

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