All posts by AOGR

AP Desperate For Funding, Keeps Talking With The Chinese

African Petroleum Corporation, the Australia listed operator, is close to securing much needed financing
partnership in working up its frontier acreages in West Africa. The Memorandum of Understanding (MoU)
which it signed with PetroChina, a subsidiary of the China National Petroleum Corporation, gives the latter
until August 31, 2012 to agree an investment in up to 20% of Block LB-09 in Liberia and up to 20% in one or more
exploration blocks in The Gambia, Ivory Coast, Liberia, Senegal and Sierra Leone.
The value of the deal has not been agreed and the deal is subject to government, regulatory and other approvals, African Petroleum noted in a widely circulated release.

→   Read the rest of this entry

Mart Resources Reports Sharp Drop in Revenue

Mart Resources, the Canadian minnow with keen interest in Nigerian production, reported a sharp drop in second-quarter 2012 earnings “due in part to lower oil prices and waning oil production”, according to the Energy Press. Bloomberg, the financial news periodical, said the company’s revenue “fell the most in almost seven months”. But the board, chaired by Founder and CEO Wade Cherwayko, declared a quarterly dividend of $.05 per share, to be paid out to its shareholders by October 2, 2012. Mart, which is listed on the Toronto TSX Venture Exchange, posted $0.88 per cent drop in profits of $2.34 million or $.07 a share, in the context of a net income of $20.81 million, or $.06 per share. Mart’s earnings declined to $28.2 million, down 41 per cent from $47.9 million.

→   Read the rest of this entry

Vegas Makes 9KBPD, With Plenty of Water

Production from the AASE, Geyad and Al Ola fields, in Egypt’s North Gemsa Concession, is approximately 9,100 BOPD (gross) varying to date in August 2012 within the range 9,000-10,000 BOPD. Cumulative production from the NW Gemsa Concession has now exceeded 8.9 million barrels of 42 degree API Crude oil. Water is currently being injected at a rate of approximately 22,000 barrels per day, with a cumulative injection to date of approximately 5.4 million barrels.

The NW Gemsa Concession, containing the Al Amir, Geyad and Al OIa Development Leases, covering an area of over 260 square kilometres, lies approximately 300 kilometres south-east of Cairo in a partially unexplored area of the Gulf of Suez Basin.

→   Read the rest of this entry

Chevron Plays Catch Up In Africa’s New Frontier

Chevron is hoping it could gain back its lead as an exploration company in Africa. The California based American major is looking closely at opportunities in East Africa, most favourably Uganda. It is also spreading its risk in those parts of the new frontier in which it already has a foothold. It recently won two acreages offshore Sierra Leone  and entered a sale and purchase agreement with Eni, the Italian giant, to sell 25% interest in three offshore blocks off Liberia, including LB 11, LB12 and LB14 offshore blocks located on the shelf and continental slope of Liberia between 0 and 3,000m of water depth cover over 9,560km2 of area.

Chevron, like other majors, lost the opportunity in Ghana, even though it holds a large share of operated production in the countries that matter most in the region: Nigeria and Angola. Still, the company’s position among the majors in these two countries has slid in the past 15 years; to second place operator after TOTAL in Angola and third place operator after Shell and ExxonMobil in Nigeria. It has also walked out of some of the countries that are commanding attention, including Namibia and Equatorial Guinea, where the prospects of pre-salt deposits suggest considerable upside.

From Venezuela with Regrets

By Adedayo Ojo

The explosion that occurred at the Amuay refinery in Venezuela recently is unarguably the most fatal disaster in the history of the oil and gas industry in the South American nation. A gas leak at the refinery, located near Punto Fijo in western Venezuela, caused an explosion that ignited and damaged nine storage tanks, killing at least 39 people, including a ten year old boy and injuring more than 80 people. Many of the victims were members of the National Guard stationed at the refinery.

Amuay refinery processes 645,000 barrels of oil per day (BOPD) and it is part of the Paraguana Refinery Complex, and one of the biggest refineries in the world. The Paraguana Refinery Complex, which also includes the Bajo Grande and Cardon Refineries, processes a total of about 955,000BOPD.

→   Read the rest of this entry

Walter Smith Fills Up The Room

From losing an oil well in an inferno to clinching a stake in a $400Million transaction, the Nigerian minnow has had a busy season

Of the several entities that formed the Niger Delta Western Ltd, the Special Purpose Vehicle which recently acquired the Shell/TOTAL/Eni equities in the Oil Mining Lease(OML) 34 in western Nigeria, Walter Smith Petroman Oil Ltd was a small, almost invisible participant.

The company, run by two former bankers out of an office in Lagos, Nigeria’s financial city, hardly got a mention in the major news stories of the transaction, largely because Niger Delta Western Ltd came forcefully across in the media as being greater than the sum of its parts.

→   Read the rest of this entry

Faga Takes You To First Oil

Abraham Faga runs a company that serves as well design, drilling operations and well completions department for a host of homegrown Nigerian E&P firms. He is in a niche market. He brings to it a wealth of experience gained largely from his background working in some of the world’s most remote places for Schlumberger (the largest oilfield service firm on the planet) and the psychology of a structured E&P company which he learned in his 12 years working for Shell, the Anglo Dutch major who operates the largest hydrocarbon asset portfolio in Nigeria.

Oil majors working in Africa have the capacity to run their own drilling operations; from well design to completion.

→   Read the rest of this entry

Morocco: Circle Looks To Drilling Campaign In Sebou, Laila Mimouna

Circle Looks To Drilling Campaign In Sebou, Laila Mimouna

Circle Oil expects to commence a five well drilling campaign later in 2012. Initial results of interpretation of 3D seismic surveys acquired in 2011 over the Sebou (17 sq km) and Lalla Mimouna (135 sq km) permits” are encouraging”, the company says, with the expected initial targets mapped prior to final ranking ahead of the third drilling campaign.

Libya: BP Threatens To Drill In Deepwater Mediterranean

BP is threatening to take on the trickster god Of Geology, claiming it might dare drill in the Mediterranean offshore Libya before the end of 2013.

The British major called off plans for the venture early 2012 as the Civil war raged in the north African country. But it was a venture that was imbued with exceptional high risk, even in peace time. The truth is, the deepwater Mediterranean, outside of BG’s concession off neighbouring Egypt, has not yielded much. Indeed, Shell has failed to hit a sizeable pool in that same corner of the Mediterranean, offshore Egypt.What BP has in Libyan deepwater is size: it will explore the frontier Sirt basin, described as being equivalent in size to more than ten of its deep-water blocks in Angola.

→   Read the rest of this entry

The African Gas Grid On Hold

The notion of a system of pipelines delivering methane from “rich” countries to “poorer” neighbours is passé.

A decade ago, there was much heady talk of a Pan African Gas Grid. The notion was of a series of gas lines, feeding off main lines, to deliver gas from hydrocarbon rich parts of the continent to hydrocarbon starved towns and villages.

There were conference deliberations of a system of cross-border gas lines diverted and integrated into national gas grids, giving access to several gas sources and allowing market security and flexibility to develop through storage and swaps of volumes between nations.

The idea started to gel as the 895km Mozambique-South African gas pipeline moved into commissioning phase in 2002 a year before the West African Gas Pipeline Implementation Agreement was signed at a ground breaking ceremony in Sekondi, Ghana. The 672km line running from Nigeria through Benin, to Togo and terminating in Ghana, was to deliver Nigerian gas to the “energy-starved” countries along the route. Around the same time, the earliest conversations about a 4,000km trans Saharan gas pipeline, taking Nigerian gas across the desert through Niger to Algeria, were being tabled.

So much promise.  Nigeria and Cameroon agreed to export more than 800million standard cubic feet per day of gas to Equatorial Guinean through pipelines from either country (although this was less for domestic purposes than for boosting EquatoGuinean plans for a second LNG project).  In Namibia, south west of the continent, arrangements were being made to pipe gas from the 1.5Tcf the Kudu gas field to South Africa, where it would feed thermoelectric plants meant to power both Cape Town in South Africa and power-starved Namibia.

The Moz-SA line  having been commissioned and the WAGP already under construction, commentators were touting these two as representing  the building blocks of a continental grid that could assure availability of gas to resource poor countries and lift the industrial capacity of those who inhabit the continent.

The promoters of WAGP painted it ever so brightly.  A Dames & Moore study, commissioned by Chevron suggested that between 10,000 and 2,000 primary sector jobs will be created as the new power suppliers stimulate the growth of new industry. This industrial growth, they touted, would create up to three times that number of secondary jobs due to the multiplier effect. A pre-investment study of the WAGP identified about $1.8 billion in total capital investment for the region as a result of pipeline project. “That includes the $ 400 million for the power plants, and $ 800 million in new industry, which include minerals processing.”

Whereas most of WAGP’s 140MMscf/d gas is destined for power plants in Ghana, Benin and Togo, replacing other fuels and reducing costs and emissions, the fact of its availability would open doors to other investment possibilities, we heard.

Investors actually sat down and took notice. Anglogold Ashanti, the huge gold miner, hinted of replacing fuel for its plants with gas from WAGP. Gaslink, the Nigerian independent gas supplier, said it wanted to tap from WAGP gas and deliver, through spur lines, to companies and industries in Ghana, Benin and Togo.

Much of that conversation has been scuttled. Today, with epileptic supply of gas from WAGP, ranking Ghanaian officials are openly wondering why they bought into the project in the first place. Togo and Benin, where the demand is weaker, have remained silenced with the disappointment. Nigeria, the source of the gas, is battling internal challenges of gas supply to its own growing domestic power capability and Shell, a major supplier of the gas for the pipeline, hasn’t lived up to its billing as a supplier of good quality pipeline gas. The power plants to be built in Ghana, as far as the Ghanaian Gas Masterplan is concerned, are looking more to gas supplies from the Jubilee field, a resource that was discovered four years after the WAGP Implementation agreement was signed. And as for thousands of jobs that were meant to be created in the event of the take off of the pipeline, what you have are angry Ghanaian commentators demanding accountability for what has gone wrong with the WAGP.

Since July 2009, when Petroleum and energy ministers Rilwan Lukman of Nigeria, Chakib Khelil of Algeria and Mohammed Abdullahi of Niger signed the agreement in Abuja, there has been a significant reduction in public discussion on the project which was proposed to have a capacity of 30 billion cubic metres per annum.

“Nobody talks of Trans Saharan Gas Pipeline anymore” says a ranking official at the Nigerian state hydrocarbon company, the NNPC. “The project has been put on hold”. The Algerians, who seemed the keener partners in the first place, have gone rather quiet, and the Nigerians talk about it in terms of, “when we are able to get some interested parties who will foot the bill”.

In the south west, Eskom’s enthusiasm for Namibian gas and/or of the power to be generated from the planned 800MW combined cycle plant at Oranjemund in Southern Namibia , that would be fueled by gas from the Kudu gas field, has waned.   Discussions between Tullow Oil, the British operator of the Kudu field and Eskom didn’t get anywhere. “The Kudu Gas to Power Project in Namibia was not concluded due to the economics of the project”, Eskom said in a statement.  “Electricity would have been produced at a cost well in excess of Eskom’s own options.  In addition certain risk allocations (such as fuel price currency and indexation) could not be agreed between the fuel supplier, the project developer and Eskom”.

In the meantime, however, some of the countries that were being describes as “energy-starved”, are turning round to be hydrocarbon rich. Ghana, for one, which is building a gas processing facility that will feed power plants and supply industrial parks. Just the other day, Apache encountered 52metres of net gas sand in a well in offshore Kenya. Companies have struck oil in Liberia and Sierra Leone.

The dynamics are changing.

© 2021 Festac News Press Ltd..