All posts tagged africainbusiness


Africa Oil+Gas Report’s June- July 2021 Bumper Edition is Out

Beneficiaries of Shell’s imminent divestment from Nigeria, the big Moza-S.A Gas pipeline sale and a list of Angolan oil producers and their current output, are some of the key highlights of the June-July 2021 edition of the monthly Africa Oil+Gas Report, just released.

There are briefings on the largest non-state hydrocarbon producers in Africa, reasons for the unlikely completion of the OB3 gas pipeline until mid- 2022, and full rig activity count for Angola and Nigeria, in the edition, which has been e-distributed, in pdf format, to the trade journal’s tens of thousands of paying subscribers around the globe.

Six updated activity maps, including Ghana’s, Mozambique’s, Angola’s, Nigeria’s, an Africa map of independents and a map of Nigeria’s recent bid round winners, are part of this valuable publishing package.

The theme of the current issue is the E&P practices of foreign independents operating in Africa, with some of the highlights of the rich, market intelligence filled, 48-page industry trade journal listed below

INDEPENDENTS’ DAY ANNUAL 2021

  • The TOP Foreign Indies in Africa, their Production
  • Indies’ Shift from Fronter Exploration to Field Optimisation
  • ReconAfrica, the Exception, Probes a New Basin in Namibia
  • MAP of Indies’ Oil, Gas Output across the continent
  • Apache in Egypt, Perenco in five Francophone Countries, jostle for lead Independent

FARM IN FARM OUT

  • Beneficiaries of Shell’s Nigerian Divestment
  • S/Sudan in Historic Bid Round
  • MAP of Nigerian Bid Round Winners

IN THE NEWS

  • How Shell Exit May Impair Nigerian Economy

  GAS MONETISATION

  • Sasol: The big Moz-SA Gas Pipeline Sale

SPREADSHEETS

  • Angolan Operators’ Production
  • Nigerian Indigenous Producers’ Updates
  • Angolan Rig Activity June 2021
  • Nigerian Rig Activity, May, June, 2021

To access the edition, please click here.

 

 

 


The Alarming Dearth in Critical Infrastructure for West Africa’s Oilfield Development

PARTNER CONTENT

By Jennifer Daniel

With the recent surge and relative stability of the price of oil within the last couple of weeks; for several economies, the economics of sustained and improved production capacity is beginning to make sense. Oil producing countries in Africa, especially those in West Africa, are the most excited.

The commercialization of fields in this region, at a time like this, is a compelling case, considering the plethora of fields that were erstwhile shut-in or undeveloped due to the coronavirus pandemic and the fluctuating price of oil in the global market.

Crucial to the effective commercialization of unproduced oil molecules in West Africa remains availability and access to field development infrastructure and resources especially for offshore locations in the light of the obvious preference of oil majors to leave onshore oilfields to independents.

Drilling rigs, Early Production Facilities, Storage facilities and FPSOs will be in demand on a larger scale if investors are to successfully milk the prevailing price advantage. Investors will need to comb the industry locally and internationally for equipment that are available and economically friendly. It is reported that the West African oil and gas industry alone has over 10 FPSOs planned and announced which are expected to come live by 2022, with 7 (seven) of those split between Nigeria and Angola.

The catalogue of equipment and infrastructure available is quite scanty but surprisingly, Century’s FPSO Tamara Nanaye, formerly Front Puffin and Tamara Tokoni are reported to be available for deployment to a full field that require floaters. This follows the purported decision of the operators of the AJE field OML 113 to harness the gas potential of the field. This is great news for fields in dire need of an FPSO within the region.

With the increasing number of fields whose development requirements necessitate the deployment of floaters, the ultimate question remains how they will be sourced, financed and deployed.

Jennifer Daniel is a PhD candidate at the Centre for Innovation & Entrepreneurship, University of Bristol.

 


Of Beads and Trinkets

By Gerard Kreeft

The International Energy Agency (IEA) in its African Energy Outlook, 2019, paints a vivid picture of Africa’s situation.

The agency predicts that one-in-two people added to the global population between now and 2040 will be African.

Nearly half of Africa’s 600Million people did not have access to electricity in 2018, while around 80% of sub-Sahara African companies suffered frequent disruptions leading to economic losses.

 The Africa Scenario is a plea for full access to modern electricity by 2030, tripling the average number of people gaining access per year from around 20Million to over 60Million. Grid expansion and densification is the least cost option for nearly 45% of the currently deprived, mini-grids for 30%, and stand-alone systems for 25%.

LPG is used by more than half of those gaining access to clean cooking in urban areas in sub-Sahara Africa; in rural areas, home to the majority without access, improved cookstoves are by far the preferred solution.

Although the African economy will grow four-fold by 2040, energy efficiency can limit primary energy to just 50%. Current electricity demand in Africa is 700 terawatt-hours(TWh) with over North Africa and South Africa accounting for over 70% of the total. In the African Scenario, growth could reach 2300TWh, with much of the additional demand coming from middle and higher income households.

Solar is only 5 GW, less than 1% of global installed capacity. In African Scenario solar overtakes hydropower and natural gas to become the largest electrical source in Africa in terms of installed capacity.

Tripling of the electricity demand requires building a more reliable power system and a greater focus on transmission and distribution to reduce power outages. Significant scale-up of investment in grids and generation is required given that Africa has 17% of the world’s population and just 4% of the global power supply.

Natural gas meets half of North Africa’s fuel requirements, but in sub-Sahara Africa only 5%. Gas will rise to 24% by 2040, mainly to power industry.

 Green help from the oil majors?

Will the IOCs produce green energy in Africa? According to Toyin Akinosho, Publisher, African Oil and Gas Report, African oil and gas revenues are financing the energy transition in the rest of the world:  ” the oil majors are funding clean energy from the balance sheet of dirty oil.”

Take TOTALEnergies.

The company is stimulating new renewable energy on a global basis while dispatching oil and gas projects in Africa. The French major’s lead in taking on board renewables as part of its reserve count, would be expected to set a precedent for other renewable projects in Africa, thus helping the continent move forward with the Energy Transition. Unfortunately, this has not proven to be the case.

Around 30% of TOTALEnergies production is in Africa but less than 0.5% of its new energy investment will directly benefit the continent. Yet according to Akinosho, TOTALEnergies is the best African renewable energy investor out of the six majors which include:

ENIlaunched with fanfare the installation of a 14KW solar system in a medical facility in Angola. In Egypt where ENI is a major player the company has not featured in the country’s relatively aggressive renewable energy plan.

BPwhich has pumped over a billion barrels of oil in Angola in the last 20 years has excluded Africa from all of its renewable energy plans.

Equinor-which pumps 120,000 barrels of oil equivalent per day in Angola also has no plans for renewables.

Chevron’s focus is not so much about investing in stand alone renewable projects but increasing renewable power in support of its business to lower its carbon intensity.

Shell-will likely take out $7.5Billion out of Nigeria between 2021-2025. Shell has funded some offgrid projects through solar developers in Nigeria, which basically represents Shell’s footprint in Africa.

If Big Oil is indeed shifting African oil money outside the continent to finance the energy transition elsewhere, what steps should be taken to ensure that Africa’s oil money is indeed used for Africa’s energy transition?

This is perhaps highly relevant at a time when national oil companies have to fill the vacuum being vacated by the international oil companies. Think of the upcoming merger between the Angolan activities of both BP and Eni, possibly to be followed by other African activities.

Jason Bordoff, Columbia Centre on Global Energy Policy, recently indicated that any shift away from the major oil producers could in the short term ..  “benefit the world’s leading petrostates, that would increase the share of global supply controlled by OPEC+ and increase the cartel’s control of world oil markets.”

According to Bordoff private equity companies are turning their attention to assets being aborted by the oil majors. Private equity now accounts for 10% of all North Sea production, up from virtually zero in 2014. Bordoff concludes that Chinese banks have also shown an ability to fill these investment slots.  Could Sub-Sahara Africa become part of this scenario?

New independent start-ups could become part of the equation.  Look at Nigeria: today 25 private companies produce nearly 400,000bopd.  If green incentives become part of the mix, growth is assured.

Africa’s power sector: The new energy players?

A final part of the equation could well be Africa’s national power and transmission companies, normally seen as a distinct and separate category and not associated with the oil and gas industry. Their story has in many cases not been properly told. Yet in a period of great transition, we can anticipate movement from the power sector.

Will the international power companies – Enel, Engie and EDP, who have broad international project experience across Africa-provide their African national power colleagues a helping hand?

 Enel

Antonio Cammisecra, CEO of Enel Green Power symbolizes Enel in Africa. “We’re Africa’s top privately-owned renewable energy operator. This is something we can definitely feel proud about but still, it’s a drop in the bucket if we consider the sheer size of Africa’s untapped potential and the huge amount of energy it needs.”

The company claims to be Africa’s largest independent renewable energy player in terms of MW installed. According to Enel’s 2019-2021 strategic plan the Enel Group is investing around €700 million in the continent, building 900 MW of wind and solar capacity.

In South Africa the company has 1.2 GW generating capacity scattered over 13 projects across the country.

In Ethiopia a 120 MW solar power plant has been installed in Metehara, Oromia Region.  All net electricity generated by the plant is delivered to the power grid. This project contributes to the achievement of Ethiopia’s electricity master plan for solar installation target of 300 MW by 2020.

In Morocco, Enel Green Power has led a consortium to complete the construction of the Midelt wind power plant, with a capacity of 210 MW. Morocco’s Integrated Wind Power Project will have a total capacity of 850 MW.

Morocco already produces some 3GW of renewable power and aims to increase its renewable production capacity to 52% by 2030. In 2008 the country imported almost 98% of its fuel, oil and gas, and therefore choose renewables to become more energy independent.

In Zambia Enel developed, built, owns and operates the 34 MW Ngonye solar PV facility, located in southern Zambia. Power will be sold to the country’s state-owned utility ZESCO through a 25-year power purchase agreement.

 Engie

Gillian-Alexandre Huart, CEO of ENGIE Energy Access, is Engie’s man in Africa. The company’s Access to Energy business on the continent, is tasked with providing millions of households and businesses across the continent with clean and affordable energy.

Engie’s Energy Access is now one of the leading off-grid, Pay-As-You-Go (PAYGo) solar and mini-grid solutions providers in Africa, serving over one million customers and impacting more than five million lives in nine countries – Uganda, Zambia, Kenya, Tanzania, Rwanda, Nigeria, Benin, Côte d’Ivoire, and Mozambique.

Engie Africa counts nearly 4,000 employees, and has 3.15 GW of power generation capacity. The group has more than 50 years of experience on the African continent and has the unique ability to implement integrated solutions all along the energy value chain, from centralized electricity production to off-grid solutions (Solar Home Systems, mini-grids) and energy services.

 EDF (Électricité de France)

EDF partners with innovative start-ups to provide energy and services to a rural clientele in South Africa, Côte d’Ivoire, Ghana, Senegal, Kenya and Togo.

Such services enable more than 1Million people to light and power their low-consumption household appliances or also to be equipped by solar powered water pumps, thereby significantly improving their crop yields.

The company plans an extensive expansion of its solar and wind activities throughout Africa in the coming years.

 Some final considerations

Recently IRENA (International Renewable Energy Agency) and AfDB (African Development Bank) have jointly announced support of low carbon projects to enhance the energy transition. IRENA in its Global Renewable Outlook states the sub-Sahara Africa could generate as much as 67% of its power from indigenous and clean renewable sources by 2030. In the energy transition this would increase welfare and stimulate the creation of up to 2Million green jobs by 2050.

Certainly public-private partnerships should be part of this mix. Governments to ensure a broad basis of support and energy companies who have the know-how and project management skills. A key bonus for oil/energy companies is knowing that renewables can be added to their reserve count.

Developing Africa’s Green Deal should be the key theme for a new partnership among oil and gas companies, national oil and gas companies and electrical and transmission companies. Such collaboration should work closely with The Clean Energy Corridor which aims to support integration of cost-effective renewable power options to national systems, promote its cross-border trade and support creation of regional markets for renewable energy.

The Clean Energy Corridor initiative has two African components: (1.) African Clean Energy Corridor (ACEC) for the member countries of Eastern and Southern African power pools.  (2.) West African Clean Energy Corridor (WACEC) within the Economic Community of West African States.

Gerard Kreeft, MA (Carleton University, Ottawa, Ontario, Canada) Energy Transition Advisor, has more than 30 years’ experience in the energy sector. He was the founder of EnergyWise.  He has managed and implemented oil and gas conferences in Alaska, Angola, Brazil, Canada, Kazakhstan, Libya and Russia. He is a Canadian/Dutch citizen. He writes on a regular basis for Africa Oil +Gas Report


Siemens appoints Dalia Shoukry as CFO in Egypt, its Biggest African Market

Siemens has appointed Dalia Shoukry as CFO in Egypt, effective immediately.

Shoukry has more than two decades of experience in financial roles covering the Middle East, Europe, and Africa.

Egypt is Siemens’ largest market in Africa and one of its biggest in the world. Between 2016 and 2019, under contract by the government, the German engineering firm built three combined cycle gas to power plants with total capacity of 14,400MW in Egypt. In December 2020, Siemens was awarded, by the Egyptian Electricity Transmission Company (EETC), the contract to build the new national energy control centre, in the country’s New Administrative Capital (NAC), still under construction, in the middle of the desert, some 45 kilometres east of Cairo.

Siemens is currently in discussions, with the Egyptian Ministry of Power nd Renewable Energy,  for a 500MW capacity Wind Farm in the country, under a Build, Operate and Transfer system.

All of which means that Ms. Shoukry has her job cut out.

Prior to Siemens, she was the international finance director AstraZeneca, the pharmaceutical giant.

She earned a degree in accounting from Ain Shams University. “We are very happy to welcome Dalia to our team in Egypt. Financing is a crucial component of our business, as it not only defines, manages, and oversees all budgets, but it also monitors the performance and ensures the financial health and stability of Siemens Egypt,” said Mostafa El-Bagoury, CEOof  Siemens Egypt.

Siemens has been active in Egypt ever since its founder, Werner von Siemens, laid a communications cable through the Red Sea in 1859 to link Suez and Aden..


Glencore Takes Carroll on Board

Glencore plc has appointed Cynthia Carroll, the British geologist and businesswoman, as an Independent Non-Executive Director of the Company with immediate effect.

Cynthia Carroll was the Chief Executive Officer of Anglo American, the world’s largest platinum producer, from 2007 to 2013. She was the first non-South African to hold the position. She was a non-executive director of the board of BP between 2007 and 2017.

Mrs. Carroll has over 30 years’ experience in the resources sector. She began her career as an exploration geologist at Amoco before joining Alcan. She held various executive roles there culminating in being CEO of the Primary Metal Group, Alcan’s core business

Cynthia Carroll is currently a non-executive director of Hitachi, Ltd (TYO: 6501), Baker Hughes Company (NYSE: BKR) and Pembina Pipeline Corporation (TSE: PPL). Previous non-executive appointments have included BP and the Sara Lee Corporation.

Glencore’s Chairman, Tony Hayward says the board is very pleased to welcome Cynthia Carroll, who has extensive knowledge of the resources industry as well as strong non-executive director experience.

 


Cameroon’s 25MW Solar Plants to Be Commissioned in Early 2022

The 10MW Guider and 15MW Maroua solar power plants, about to commence construction, will cost $31Million (XAF17Billion), and should be up and running before mid-2022. Guidder is located in Cameroon‘s North Province, close to the border with Chad, whereas Maroua is the capital of the country’s Far North Region.

The power utility ENEO (Energy of Cameroon), has received guarantees from the country’s Investment Promotion Agency (API), that the construction project will benefit from the tax and customs exemptions provided by the 2013 private investments incentives law (revised in 2017).  The related agreement was signed on January 20, 2021, in Yaoundé,

MGSC (a joint venture formed by Norwegian company Scatec, Israeli-American group Izuba Energy and Sphinx Energy, run by a Cameroonian economic operator based in the USA) was chosen by ENEO, in 2018, to develop the project.

Scatec, the leader of the consortium, has one of the largest solar energy capacities in Africa (400 MW in Egypt, over 300 MW in South Africa, 40MW in Mozambique, 300 MW under construction in Tunisia …).

The 25MW of solar energy expected from the Guider and Maroua plants will be sold to ENEO, according to the contract binding the involved parties. The power output should help diversify Cameroon’s energy mix, which is still largely dominated by thermal and hydroelectric energy. It should also reduce energy production cost.

 

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Energean to Top Up Egypt’s Gas Output with 90MMscf/d

By Toyin Akinosho

Energean’s Final Investment Decision on the NEA/NI project in Egypt, calls for a $235Million spend to deliver natural gas at 90Million standard cubic feet per day at peak.

TechnipFMC has been awarded the EPIC contract to deliver the project.

Energean Plc is a London listed firm with focus on the Mediterranean.

NEA/NI refers to North El Amriya and North Idku concessions, which are, though not contiguous, being jointly developed.  The project is a shallow offshore subsea tieback.

The NEA concession contains two discovered and appraised gas fields (Yazzi and Python) while the NI concession contains four discovered gas fields, one of which is readied for development.

NEA/NI, with 49Million Barrels of Oil Equivalent (BOE) of 2P reserves, 87% of which is gas, is due to deliver first gas in the second half of 2022. Some 1,000Barrels per day of condensate will also be produced.

“When Brent prices are above $40/bbl, gas will be sold at $4.6/MMBTU, which is the highest achieved to date for shallow water gas production, offshore Egypt”, Energean says in a statement.

 


ENI Increases Its Ghanaian Oil Production by 34%, to 52,000BOPD

Italian major ENI increased the gross output in Ghana’s Sankofa Gye Nyamme (SGN) field by 34% in the first half of 2020, relative to the output in the first half of 2019.

The company produced 9,562,821.97 Barrels during the period, representing an increase of 2,408, 486.97 Barrels over H1 2019 production of 7,154,335 Barrels, according to the country’s Public Interest Accountability Committee (PIAC), Ghana’s equivalent of an EITI agency.

As a result, average daily production increased to 52,543BOPD from 39,534BOPD  for the same period in 2019, the PIAC rreports.

ENI operates the Offshore Cape Three Points (OCTP) acreage, which contains the SGN field, with a 44.44% share. Other partners are Vitol with 35.56% and Ghana National Petroleum Corporation with 20%.

First oil flowed from the acreage in May 2017.

The year-on-year increase “was attributed to stable production operations, resulting from the FPSO John Agyekum Kuffuor’s (JAK) excellent plant uptime of about 99.95%, and the coming on stream of the OP-9 and OP-10 producer wells”, PIAC explains.

This piece was earlier published in the December 2020 edition of the monthly journal: Africa Oil+Gas Report.


Ghana Installs a Floating Solar Power Plant in a Hydroelectric Dam

Ghanaian authorities have inaugurated a floating solar power plant built in the reservoir of the hydroelectric dam in Bui, in north-eastern Ghana. The 5 MW plant is the first phase of a project to support the hydropower installation with a 250 MW solar system.

The second phase of the solar plant is under construction.

The Bui Hydroelectric dam has the capacity to produce 400MW of electricity. When the solar hybridization is completed, it will be able to output 650MW.

The Bui Power Authority (BPA) is the body responsible for managing this facility.

In times of drought, the solar power plant should complement the production of the dam, which drops as the flow of the Volta Noire river drops. According to Afare Apeadu Donkor, the chairman of the board of directors (PCA) of BPA, construction work on the second phase of the project, in addition to the new floating solar power plant, is “progressing”.

 


Africa’s Electricity Unlikely to Go Green This Decade

PARTNER CONTENT

New research from the University of Oxford predicts that total electricity generation across the African continent will double by 2030, with fossil fuels continuing to dominate the energy mix – posing potential risk to global climate change commitments.

The study, published by Nature Energy, uses a state-of-the art machine-learning technique to analyse the pipeline of more than 2,500 currently-planned power plants and their chances of being successfully commissioned. It shows the share of non-hydro renewables in African electricity generation is likely to remain below 10% in 2030, although this varies by region.

“Africa’s electricity demand is set to increase significantly as the continent strives to industrialise and improve the wellbeing of its people, which offers an opportunity to power this economic development through renewables” says Galina Alova, study lead author and researcher at the Oxford Smith School of Enterprise and the Environment

“There is a prominent narrative in the energy planning community that the continent will be able to take advantage of its vast renewable energy resources and rapidly decreasing clean technology prices to leapfrog to renewables by 2030 – but our analysis shows that overall, it is not currently positioned to do so.”

The study predicts that in 2030, fossil fuels will account for two-thirds of all generated electricity across Africa. While an additional 18% of generation is set to come from hydro-energy projects. These have their own challenges, such as being vulnerable to an increasing number of droughts caused by climate change.

The research also highlights regional differences in the pace of the transition to renewables, with southern Africa leading the way. South Africa alone is forecast to add almost 40% of Africa’s total predicted new solar capacity by 2030.

“Namibia is committed to generate 70% of its electricity needs from renewable sources, including all the major alternative sources such as hydropower, wind and solar generation, by 2030, as specified in the National Energy Policy and in Intended Nationally Determined Contributions under Paris Climate Change Accord,’ says Calle Schlettwein, Namibia Minister of Water (former Minister of Finance and Minister of Industrialisation). “We welcome this study and believe that it will support the refinement of strategies for increasing generation capacity from renewable sources in Africa and facilitate both successful and more effective public and private sector investments in the renewable energy sector.”

“The more data-driven and advanced analytics-based research is available for understanding the risks associated with power generation projects, the better”, Mr. Schlettwein argues. “Some of the risks that could be useful to explore in the future are the uncertainties in hydrological conditions and wind regimes linked to climate change, and economic downturns such as that caused by the COVID-19 pandemic.”

The study suggests that a decisive move towards renewable energy in Africa would require a significant shock to the current system. This includes large-scale cancellation of fossil fuel plants currently being planned. The study also identifies ways in which planned renewable energy projects can be designed to improve their success chances – for example, smaller size, fitting ownership structure, and availability of development finance.

“The development community and African decision makers need to act quickly if the continent wants to avoid being locked into a carbon-intense energy future’ says Philipp Trotter, study author and researcher at the Smith School. ‘Immediate re-directions of development finance from fossil fuels to renewables are an important lever to increase experience with solar and wind energy projects across the continent in the short term, creating critical learning curve effects.”

 

 

 

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