All posts tagged featured

OMLs 83, 85 Bid Is a One Day Auction

Any chance of winning? Seplat’s CEO, Austin Avuru

…and final bids for OMLs 52, 53 and 55 must be accompanied with a non- refundable fee equaling 15% of the offer.
By Fred Akanni

Chevron’s sale of its 40% stakes in Oil Mining Leases (OMLs) 83 and 85, in Nigeria’s shallow offshore, will be a one day auction. It is planned not to be as complicated as the company’s sale of its equity in OMLs 52, 53, 55, three onshore leases in the east of the country.

Sometime between mid- September and October 15, 2013, Chevron will simply choose a date on which participating companies will make an offer and the top bidder will be asked to pay, company sources say.

The data room for OMLs 83 and 85 was opened last May, a full month before bids were invited for the three onshore leases. But interest in OMLs 52, 53 and 55 has been marked, with 36 companies making indicative offers as of the deadline of July 29, 2013. Twenty five of these were weeded out. The 11 companies which made it to the second round are currently evaluating the data in Chevron offices in Houston, the United States. They include: Seplat, First Hydrocarbon Nigeria, South Atlantic Petroleum (SAPETRO), which is in league with Niger Delta Petroleum Resources, Sogenal Ltd, Seven Energy, Britannia U, First Exploration and Production Ltd, Amni International Petroleum, Sahara Energy Group Belema and the Dangote Group. They will be expected to make their bids before the end of September. All such bids are to be accompanied with a non-refundable commitment fee which is 15% of the bid offer.  Three finalists are expected to have been announced by October 1, 2013.

But while there’s so much buzz around OMLs 52, 53 and 55, talk around progress of the sale of OMLs 83 and 85 has been muted. There is certainly much less appetite for OMLs 83 and 85, which are located offshore Bayelsa state, regarded as one of the most active sites of piracy in the Gulf of Guinea. OMLs 83 and 85 are also less advantaged because they are undeveloped assets, compared with the eastern onshore OMLs which are mostly producing properties.

Still, OML 83’s Anyala and OML 85’s Madu fields are very prospective acreages that have been the talk of the upstream property market in Nigeria for upwards of eight to 10 years. Chevron “inherited” Anyala and Madu, with its acquisition of Texaco in the late 90s. The fields themselves had only been discovered in the early 1990s and Chevron, though willing to increase output, had kept putting off sanction for their development.

The Information Memorandum sent to the invited companies declares that OML 83’s Anyala field “has discovered total resource and upside potential (as deeper opportunities are mapped) of over 200MMBOE(8/8ths). The field’s discovery well, Anyala 01A, drilled in 1974, encountered 259 feet net gas sands, 50 feet net oil sands and 34 feet net undifferentiated hydrocarbon. Additional five exploratory and six appraisal wells were drilled and evaluated between 1996 and 2006. The field is fully covered by seismic data, Chevron notes in the IM, stating that “250km of 3D seismic data was acquired over Anyala field in 1993 and processed in 1994. 700 km of 2000 vintage migrated full stack3D seismic data was bought in 2006. Time-depth chart is based on Anyala 4 and Anyala 8 check shots and seismic stacking velocity”.

OML 85’s Madu field has discovered total resource and upside potential (as deeper opportunities are mapped) of over 140MMBOE (8/8ths). Approximately 45% of discovered resource is gas. The field was discovered in 1992 with Madu 01 well, drilled in 80 feet of water to a TD of 9, 114 feet True Vertical Depth subsea. The well encountered 170 feet net oil and 146 feet net gas in six hydrocarbon zones. Additional nine appraisal wells were drilled and evaluated between 1992 and 2006, the company says.


The Charmed Life Of The Explorer’s Explorer

Eddie Iyamu

Eddie Iyamu was the authentic hero, a true Nigerian original
By Toyin Akinosho

“I nearly fell off my chair the day he told me at our Tinubu office that he had just resigned his top Exploration Manager job at Shell”, Samuel Oluwole Ariyo recalls, again and again.

He tells this personal story all the time, and every new recall is told with more excitement.

The man in the tale is Eddie Iyamu, the first Nigerian to be made Exploration Manager at Shell, and the first homegrown geoscientist to reach that position in any oil major operating in the country.

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Tanzania Is Desperate To Be Mozambique

By Sa’ad Bashir, Dar es Salaam

Tanzania is claiming it would hold 200 trillion cubic feet (Tcf) of natural gas resources after 2015. It is the latest in the government’s routine public statements touting a likely increase in its hydrocarbon reserves.

Tanzania does this chest beating about its gas upsides fairly regularly. It is a tendency unusual among African governments, especially those in who are just joining the old club of hydrocarbon resource rich countries on the continent.

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Shell, Transcorp, Kicked Out Of Chevron Asset Bid

Femi Bajomo, FHN's Chief Operating Officer

11 companies left standing in second round

Shell Nigeria, the country’s largest operator and Transcorp, an ambitious firm controlled by the flamboyant “Afrocapitalist” Tony Elumelu, are two of the high profile companies weeded out in the first round of the bid for Chevron’s 40% stake in three Oil Mining Leases(OMLs) in Eastern Niger Delta.

The acreages are OMLs 52, 53 and 55, which contain proven oil and gas reserves of 555MMBOE, according to Chevron’s Information Memorandum, quoting the Nigerian Department of Petroleum Resources (DPR). 

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Ghana Is 40% of Tullow’s Worldwide Production


West Africa represented 77% of Tullow’s  88,600 BOEPD working interest production in the first half of 2013, with Ghana alone  delivering 40% of the entire volume. The 88,600BOEPD figure is up 14% from half year 2012. It helped boost first half 2013 revenue by 15% to $1.3bn and moved operating cash flow before working capital to exceed $1bn for the period.

“The Jubilee field is Tullow’s flagship offshore operated asset contributing around 40% to the Group’s overall production”, Tullow remarks in a recent release.

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Seplat, FHN, Look Good For Chevron’s Eastern Nigeria Assets


NDPR in Bed With SAPETRO for prized acreages
By Fred Akanni

Tuesday, July 29, 2013, was the deadline for the indicative offers for Chevron’s 40% stakes in three Eastern Nigeria assets.

Of the 20 odd companies invited to bid for Oil Mining Leases(OMLs) 52, 53 and 55, all onshore Niger Delta,  Seplat, the continent’s largest indigenous oil producer and First Hydrocarbon Nigeria, the local subsidiary of London listed Afren, and NDPR (Niger Delta Petroleum Resources), are looking good to clinch the acreages. The indicative offer is meant to determine how technically and financially sound the bidders are, but does not entirely define who wins the bid, in the opinion of impeccable sources at the Department of Petroleum Resources, the country’s regulatory agency.

Seplat and FHN look good because, apart from the technical knowhow, they have readier access to cash than other companies. Seplat has net oil production of 22,000BOPD in three acreages. FHN has far less than this in terms of production, but it can bank on its 55% ownership by Afren. One company with a good cash flow that is not on the list is Midwestern Oil and Gas, the largest Nigerian producer of a marginal field( Umusadege, 14,000BOPD). “We have not been approached by Chevron and it is rather surprising”, says Adams Okoene, Midwestern’s Managing Director.

NDPR would ordinarily have had a tough time raising money for the assets, even though it is the operator of Ogbele marginal field and the key partner in the Niger Delta Western, which holds 45% in the Oil Mining Lease(OML 34), the gas prone acreage which is the major supplier of domestic gas to the Nigerian market. But NDPR has a working relationship with cash flush South Atlantic Petroleum(SAPETRO), whose portfolio include over 10% in the 175,000BOPD Akpo field, in the deepwater offshore South Eastern Niger Delta.

Also on the invitees list are Oryx, owned by the Swiss investor Jean Claude Gandur, Lekoil, Frontier Oil and several others.

The indicative offer marks the beginning of the series of events culminating in the emergence of a winner by the end of September 2013.

AP Completes Processing In Cote d’Ivoire’s CI-513 and CI-509


Three dimensional (3D) seismic processing has been completed for the entire 4,200 km2 survey over Blocks CI-513 and CI-509, offshore Cote d’Ivoire.

African Petroleum, the Australian minnow which operates the assets, says that “final angle-stacks have been received for both CI-513 (May 2013) and CI-509 (June 2013), allowing for prospects to be matured further”. The company enthuses that the 3D “seismic data shows encouraging submarine fan leads and prospects over Blocks CI-513 and CI-509 and has confirmed the presence of major turbidite fan systems”.

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Apache Pushes Up Egypt’s Reserves Estimates


Test of new discoveries total 14,700 barrels, 28 MMcf per day

– Riviera SW-1X flows 5,822 barrels, 2.8 MMcf per day in Lower Bahariya test
– Narmer-1X Paleozoic strat trap sets up new play
– West Kalabsha appraisal tests 3,500 barrels, 3.2 MMcf per day

Apache Corporation has reported seven oil and gas discoveries in four different geologic basins and six different concessions, south of the Meditteranean sea in Egypt’s onshore Western Desert. All seven finds have been tested and Riviera SW-1X is already producing, the company reported in a statement.

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A Looming Downstream Boom, Not In Refining

The 1,000BOPD Ogbele Diesel Plant Is the only refinery completed in Nigeria in the last 15 years

Assembling the political will and investment resources to build a refinery in Africa is a daunting task
By Neil Fleming, courtesy of the Oxford Institute for Energy Studies

Led by booming economies like that of Côte d’Ivoire, Mozambique and Ethio­pia, sub-Saharan Africa’s oil demand is set to jump by 50 percent in the next decade, outstripping growth in the rest of the world by a factor of around four to one.

That’s the forecast from downstream African consulting specialists CITAC, who predict African oil demand will hit 5.1 MMBOPD in 2023, up from 3.4MMBOPD in 2012. By 2020, demand is set to be some 4.5 MMBOPD, with West and Central African demand growing the fastest (44 percent), and North Africa likely to grow by 26 percent.

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AP Is Desperate To Farm Down In Liberia, Cote d’Ivoire

AP Is Desperate To Farm Down In Liberia, Cote d’Ivoire

African Petroleum, the Australian junior whose Liberian discovery may turn out to be the most significant discovery in the West African Transform margin in the last three years, is keen on getting ahead with appraisal, possible field development and monetization of the asset.

But the company is cash strapped.  After carrying the entire cost of drilling three wells in deepwater Liberia (Block LB-09), AP is desperate for a financing partner to share costs of the appraisal and development. The company’s exploration funds are also spread thin over other acreages in Cote d’Ivoire, Senegal, Gambia and Sierra Leone.

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