Angola’s largest homegrown independent, Etu Energias (formerly Somoil), has secured a $60Million senior debt facility from Africa Finance Corporation (AFC) to acquire oil and gas reserves co-owned by France’s TOTALEnergies and Japan’s INPEX Corporation.
In January 2022, Inpex announced that it hadagreed to sell, jointly with TOTALEnergies, all shares in Angola’s Block 14 B.V. held by INPEX Angola Block 14 Ltd. (IAB14), a wholly owned subsidiary, to Etu Energias. Through IAB14, INPEX owned 49.99% of the shares in Angola Block 14 B.V., an affiliate company of TOTALEnergies, thereby indirectly owning a 9.99% participating interest in Offshore Angola Block 14 and 4.99% participating interest in Lianzi field in the Offshore zone distributed equally between the Republic of Angola and the Republic of the Congo where it had participated in the development and production of crude oil
The $60Million investment by AFC is part of a $190Million debt facility to support Etu Energias in acquiring the assets, expected to double the company’s net production rate from 9,000 barrels per day (BOPD) to 19,000BOPD, cementing the company’s position as Angola’s leading indigenous upstream oil and gas company and a key player in the evolving energy sector.
“The senior debt facility for Etu Energias was structured as a club loan, with AFC playing an active role as a co-mandated lead arranger along with the African Export-Import Bank (Afreximbank). Banco Africano de Investmento (Banco BAI) also collaborated in the financing of the club loan”, AFC says in a release.
AFC says it is stepping up investment in Angola’s energy sector following deployment of approximately $165Million in Sonangol, Angola’s state-owned oil company, between 2021 and 2022, and a recent $100Million investment for the construction of the Cabinda oil refinery in northern Angola alongside Gemcorp Holdings Limited (GHL) and African Export-Import Bank (Afreximbank).
Angola’s National Oil, Gas and Biofuels Agency (ANPG) has signed three Addenda to Risk Service Contracts, with the Consortium of Blocks 30, 44 and 45, made up of ExxonMobil(60%) and Sonangol (40%).
The Addenda are based on the Contracts signed in 2020, given the need to increase the volume of research activities in this maritime area (offshore), with more than 17,800 square kilometres, located in deep waters in the Namibe Basin.
“The signed documents result from the conclusion of a long negotiation process, whose main objective is the revitalization of petroleum activities, changes to current fiscal and contractual terms, deepening geological knowledge, exploring the existing hydrocarbon potential, as well as improving the attractiveness for new investments in exploration and drilling, in the concession areas of Blocks 30, 44 and 45”, the ANPG says in a statement.
“The addenda made now materialize recommendations from the Competitiveness Study carried out by ANPG between 2022-2023, with a view to finding solutions and defining strategies to make the Angolan oil sector more competitive and attractive, in line with encouraging investment in oil operations and investing in discovery and profitability of Angola’s oil resources”.
The Egyptian Ministry of Petroleum and Mineral Resources has officially unveiled the winners for the 2022 Egyptian Natural Gas Holding Company (EGAS) International Bid Round.
Four of the 12 blocks up for grabs went to three companies. The Italian explorer, ENI, secured two (2) blocks (N. Port Fouad and South Nour). In a strategic alliance, ENI and QatarEnergy jointly clinched the third block, East Port Said. The fourth block was awarded to Zarubezhment, a Russian energy company.
The acreages on offer in this particular round, initially disclosed in December 2022, are entirely located in the Mediterranean Sea and the Nile Delta.
Participation in the bidding process was limited to companies connected to Egypt Upstream Gateway (EUG), a National Data Repository established in February 2021.
Egyptian authorities portray EUG as “a pivotal tool for safeguarding exploration and production (E&P) data, actively managing important information, and promoting prospects in the upstream sector through international bid rounds”. Approximately 25 companies, comprising both majors and independents, were eligible to participate.
The deadline for submission of bids was set for April 30, 2023. The blocks made available during this round included N. Habata, N. Agiba, East Alexandria, North El Nubariya, North El Khataba, South Abu Madi, N. Port Fouad, South Nour, East Port Said, South Damietta, East Tanta, and West Ismalia.
Angola commenced, on September 30, 2023, the public tender for the award of 12 onshore blocks in the Kwanza and Congo basins.
The acreages include:
(A) Onshore Congo Basin blocks: CON Block 2, CON Block 3, CON Block 7 and CON Block 8.
(B) Onshore Kwanza Basin Blocks include: Block KON 1, Block KON 3, Block KON 7, Block KON 10, Block KON 13, Block KON 14, Block KON 15 and Block KON 19.
The country’s National Agency of Petroleum, gas and Biofuels (ANPG), expects the tender to run for the next six months and the winners announced on March 19, 2024.
The agency outlined a five-point strategy for issuing the tender:
Reassess the existing oil potential in the Lower Congo and Kwanza Onshore Basins.
Leverage technological innovation and good governance practices.
Relaunch the exploration and production of hydrocarbons in the onshore areas of the basins.
Encourage the participation of small and medium-sized oil companies and promote the incorporation of qualified Angolan labor.
Mitigate the decline in production by increasing exploration activities and discovering new resources.
Herewith, below, is the BRIEF GEOLOGY OF THE 12 BLOCKS ON OFFER IN ANGOLAN BID ROUND
Onshore Congo Basin Blocks
CON BLOCK 2
Area: 631.97 square kilometres
Location: North of the Lower Congo Basin (Soyo area), limited to the north by the Zaire River, to the south by Block CON 4, to the east by Block CON 3 and to the west by Block CON 1.
Source rock (Pre-salt): Clays from the Pinda Formation and/or Bucomazi Formation;
The Oolites of the Pinda Formation;
Trap: Mixed type (structural and strategic);
Cover rock: With Evaporites from the Loeme Formation and Pinda Formation.
CON BLOCK 3
Area: 723.3 square kilometres.
Location: Northern part of the basin, limited to the North by the Zaire River, to the South by Block CON 5, to the East by the Pre-Cambrian Saco and to the West by Block CON2.
Source Rock: Clays from the Bucazi Formation;
Reservoir: Sandstones in Pinchout of the Erva Formation.
Trap: Mixed type (Structural or Strategic;
Covering Rock: Clay from the Bucamazi Formation
CON BLOCK 7
Location: Centre of the Lower Congo Basin, Soyo area, limited to the North by blocks CON 4 and CON 5, to the South by the pre-Cambrian Saco and to the West by Block CON 6.
Source rock: Clays from the Bucomazi Formation; Reservoir: “Pinchout” sandstones of the Erva Formation; Trap: Mixed Type;
Covering Rock: Clays from the Bucomazi Formation.
CON BLOCK 8
Area: 757.75 square kilometres.
Location: Western part of the Lower Congo Basin. Pre-salt: structures like horsts and grabens with faults in the basement.
Source rock: Clays from the Pinda and Bucomazi Formation; Reservoir: Carbonates from the Pinda Formation.
Trap: Mixed Type.
Onshore Kwanza Basin Blocks
Kwanza Onshore Basin
BLOCK KON 1
Area: 1577.75 square kilometres.
Location: Northern part, limited to the North by the Pre-Cambrian Saco, to the South by the KON 2 and KON 3 blocks, to the East by the Pre-Cambic Saco and to the West by the Atlantic Ocean. Post-salt: Source rock: Clays from the Cuvo Formation.
Reservoir: Cuvo Formation carbonates and pinchout sandstones.
Covering rock: Clays from the Cuvo Formation Evaporites from the Sal Massif Formation.
BLOCK KON 3
Area: 1 385.06 square kilometres.
Location: Northeast of the Onshore Kwanza Basin, limited to the North by Block KON 1, to the South by KON 6 and KON 7, to the East by the Pre-Cambrian Saco and to the West by KON 2.
Cover rock: Intraformational clays from the Albian and Cabo Ledo formation).
BLOCK KON 13
Area: 1,010.73 square kilometres, located in the Centre-East of the basin.
Source rock: Clays from the Cuvo Formation. Reservoir: Formation carbonates and pinchout sandstones.
Trap: Mixed Type (Structural or Strategic). Covering rock: Clays from the Cuvo Formation.
BLOCK KON 14
Area: 1 021.93 square kilometres.
Location: onshore basin, limited to the south by KON 10 Block, to the south by KON 18, to the west by KON 13 and to the east by the Precambrian Saco.
Source rock: Clays from the Cuvo and Binga Formation. Reservoir: Binga and Catumbela Formation carbonates. Trap: Mixed type.
Cover Rock: Intraformational clays from the Albian and Cabo Ledo formation.
BLOCK KON 15
Area: 007.82 square kilometres.
Location: Southwest of the onshore basin, bordered to the north by Block KON 11, to the south by Block 8 of the Kwanza Maritime Basin, to the east by blocks Kon 16 and 19 and to the west by blocks 7 and 8 of the Kwanza marine basin.
Source rock: Clays from the Cuvo Formation; Reservoir: Carbonates from the Cuvo formation and sandstones in “pinchout”. Trap: Mixed
Cover Rock: Cuvo and Evaporite Formation, Intraformational Clays from the Albian and Cabo Ledo Formation.
BLOCK KON 19
Area: 1007.82 square kilometres.
Location: Southwest of the basin, limited to the North by the Onshore Kwanza Basin, to the North by Block KON 21, to the East by Block 20 and to the West by Block KON 20.
Source rock: Clays from the Cuvo formation. Reservoir: Carbonates from the Cuvo Formation. Trap: Mixed Type (Structural or Strategic); Covering Rock: Saliferous Formation Evaporites.
TOTALEnergies EP Angola Block 20 has finalized the sale to PETRONAS ANGOLA E&P LTD (PAEPL), a company belonging to the PETRONAS group of companies, of a 40% interest in Block 20 in the Kwanza Basin in Angola.
PETRONAS is Malaysia’s state hydrocarbon firm and it is very active in Africa.
“The transaction was completed for an amount of $400Million as at January 1st, 2023, subject to customary price adjustments”, TOTALEnerges says in a statement, adding it retains the operatorship and a 40% interest in Block 20, alongside PAEPL (40%) and Sonangol Pesquisa e Produção S.A. (20%).
Block 20 contains the Cameia and Golfinho oil discoveries, located around 150 kilometres southwest of Luanda.
“These discoveries are planned to be developed through a system of subsea wells connected to a FPSO (Floating Production, Storage and Offloading unit) with an oil production capacity of 70,000 barrels per day, which will be the seventh FPSO developed by TOTALEnergies in Angola. The project will include the best available technologies to minimize greenhouse gas emissions and the facilities will be designed for zero flaring, with the associated gas entirely reinjected into the reservoirs”.
TGS and PGS, two leading geophysical and data storage companies, headquartered in Norway, are combining to create “a stronger and more diversified geophysical company and data provider to the energy value chain, driven by technology and innovation”, a statement by TGS says.
The transaction is expected to be completed as a statutory merger pursuant to Norwegian corporate law, with merger consideration to PGS shareholders in the form of 0.06829 ordinary shares of TGS for each PGS share.
Following the completion of the transaction, TGS and PGS shareholders will own approximately 2/3 and 1/3 of the combined company, respectively, on the basis of the share capital of each of the companies as of 15 September 2023.
“The transaction establishes the combined company as a full-service geophysical data company with a strong offering in all segments, including Multi-Client data, streamer data acquisition, Ocean Bottom Node (‘OBN’) data acquisition, imaging and new energy data. Moreover, the transaction helps mitigate supply chain risks and will add further to economies of scale and efficiency, enhancing the value offered to clients”, TGS explains, adding: “preliminary estimate of more than $50Million annually in cost synergies
The transaction is supported by the Board of Directors of both companies. Kristian Johansen and Sven Børre Larsen will continue as CEO and CFO post transaction.
Definitive merger agreements are expected to be entered into in October 2023, with closing of the transaction expected during the first half of 2024, subject to satisfaction of conditions for completion.
In Multi-Client, the combined company will offer customers a global seismic library with data from all active basins in both the western and eastern hemispheres. In data acquisition, the combined company will be a substantial player globally with a strong operational track record. For streamer acquisition, it will hold an operational fleet of seven 3D data acquisition vessels, and for Ocean Bottom Node (OBN) acquisition, the combined company will benefit from around 30,000 mid and deepwater nodes. Within imaging, the combined company will offer a strong service to in-house and external customers integrating on-premises and cloud based high-performing computing services. In addition, the combined company sees significant growth opportunities in new energy with complementary technology offerings for Carbon Capture and Storage (CCS) and offshore wind.
“The seismic industry is changing whereby production seismic is becoming increasingly important alongside the traditional exploration seismic. By combining TGS and PGS’ complementary resources, we create a fully integrated geophysical service provider well positioned to generate significant value for all stakeholders” stated Rune Olav Pedersen, President & Chief Executive Officer of PGS.
“This is a strategic transaction for TGS and a major step on the journey we started in 2019. It will combine the capabilities of both companies to create a geophysical powerhouse. The transaction continues TGS’ strategic development from a pure Multi-Client seismic company to the leading acquirer and provider of geophysical data to both the oil and gas and new energy industries” stated Chris Finlayson, Chair of the Board of TGS.
The combined company will have a combined fully diluted market cap of approx. $2,616Million and a net interest-bearing debt (NIBD) of U$649Million (2Q 2023), corresponding to a market cap:NIBD ratio of 80:20. The combined company will seek to optimize its capital structure, efficiency and cost based on the strength of the combined balance sheets and cash flows. As such, the combined company plans to refinance PGS’ $450Million senior notes and the term loans on first call opportunity. As an overriding principle, TGS will continue to maintain a conservative balance sheet profile.
Key terms of the merger:
Based on a TGS share price as of close 15 September 2023 of NOK 147.50, the exchange ratio of 0.06829 and 925,321,732 fully diluted PGS shares, the equity value of PGS is NOK 9,321Million, corresponding to a price per share of NOK 10.073. This represents a premium, of 20.7% to PGS closing price on 15 September 2023 and an exchange ratio premium of 22.4%, 40.8% and 41.6% based on 30 days, 3 month and six months VWAP as of 15 September 2023, respectively.
Future TGS dividend payments up to closing will be compensated to PGS shareholders. The full merger plan is expected to be published during October 2023.
The transaction remains subject to certain conditions, including a confirmatory due diligence by both parties, finalizing and executing a definitive merger plan, as well as customary closing conditions such as relevant regulatory approvals and consents and expiry of statutory waiting periods and no material adverse change occurring. The transaction is also subject to approval by extraordinary general meetings in both TGS and PGS with at least two-thirds majority. Closing of the transaction would occur as soon as possible thereafter.
By Lukman Abolade, Senior Correspondent, Africa Oil+Gas Report
The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has announced the finalisation of the 2023 Nigerian Gas Flare Commercialisation Programme without publishing the list of the successful companies.
In a statement released in Abuja, the NUPRC disclosed that 42 companies/entities were deemed successful in the competition to win and develop 49 flare sites announced during the 2022 Nigerian Gas Flare Commercialisation Programme (NGFCP) auction process. Among these, 38 companies were granted 40 standalone single flare site developments, while four companies received nine sites to be developed as clusters. Additionally, reserve bidder status was granted to some companies in case the preferred bidders failed to meet the stipulated terms and conditions.
But the absence of accompanying list of names of the winners has left several industry stakeholders puzzled, dredging up the usual questions about transparency and accountability in Nigeria’s hydrocarbon sector.
When contacted, Adamu Garba, the NUPRC Head, Public Affairs Unit, cited ‘technicalities’ as reason for the delay in publishing the list along with the commission’s statement of bid round outcome made on September 12, 2023.
“There are still some technicalities that we are trying to fix, when we are done, we’ll make it public, we will make it available then,” Garba said.
But the NUPRC statement itself had indicated that award letters were already being transmitted to the respective successful entities through the appropriate channels.
In furtherance of its mandate in Section 7 (e) and Section 105 (2) of the Petroleum Industry Act (PIA), 2021, the statement said, the commission, in the third quarter of 2022, restructured the NGFCP and re-launched the programme to align with the provisions of the PIA, as well as reflect prevailing economic and operational realities.
“The engagements by the commission were to galvanise and sustain interest in the programme, attract investments and stimulate participation by local and foreign entities,” NUPRC stated.
The Commission noted that in response to the Request for Qualification issued in the fourth quarter of 2022, 300 companies/entities indicated interest in either revalidating their pre-qualification status as existing participants or submitting Statement of Qualification as new participants.
“Following the evaluation of SOQs, a total of 139 applicants were deemed successful and awarded the qualified applicant status. Subsequently, in the first quarter of 2023, the commission issued the Request for Proposal to enable qualified applicants to put together their respective proposals for any of the 49 flare sites on offer.
“88 entities, comprising individual companies and consortiums responded to the RFP and submitted a total of 137 proposals, each containing technical, commercial and financial documentation for one or more of the 49 flare sites for either standalone or cluster development,” the statement read.
NUPRC said the proposals were duly evaluated by the commission and approval secured to announce 38 companies granted 40 standalone single flare site developments, while four companies which also received nine sites to be developed as clusters.
The NUPRC further noted that the preferred bidders would proceed individually to execute a suite of commercial agreements with relevant parties and effect payment of the prescribed award fees to enable the granting of permits to access flare gas by the commission.
However, the absence of a published list of selected companies has left the Nigerian public in the dark regarding the companies that will be sealing these crucial agreements with the NUPRC.
This marks the second consecutive Nigerian hydrocarbon bid round whose outcome would be announced without a list of the winners.
The defunct Department of Petroleum Resources (DPR) also failed to announce the 161 companies selected as winners of interests in the 57 marginal fields on offer in the Nigeria’s second marginal field bid round in 2021 which led to speculations and allegations.
Unlike Nigeria, countries such as Angola, Ghana, and even neighbouring Cameroon routinely publish detailed lists of bid round winners during announcement, providing a clear picture of who will be responsible for developing their hydrocarbon resources. The absence of this crucial information in Nigeria’s announcements has fuelled scepticism and speculation.
In the absence of a published list of winners, stakeholders in the oil and gas sector are now questioning the fairness and integrity of the process. Industry experts argue that without a published list, it becomes challenging to scrutinize the qualifications and capabilities of the winning companies, potentially undermining the program’s success.
In stark contrast to Nigeria’s approach, countries such as Angola, Ghana, and even neighbouring Cameroon consistently publish detailed lists of bid round winners during announcements, providing a clear and transparent picture of who will be responsible for developing their hydrocarbon resources. The absence of this crucial information in Nigeria’s announcements has fuelled scepticism and speculation within the industry.
The British minnow, SDX Energy, is close to selling its Egyptian assets, as part of a transition roadmap to “monetize exciting opportunities around its Moroccan assets and related energy transition sector-plays”, the company has said.
SDX ‘s Egyptian portfolio contains interests in six concessions in Egypt and Morocco. In Egypt, the Company has a working interest in two producing assets, such as a 55% operated interest in the South Disouq concession in the Nile Delta and a 50% non-operated interest in the West Gharib concession located onshore in the Eastern Desert adjacent to the Gulf of Suez.
In Morocco, the company has a 75% operated working interest in four exploration permits, all situated in the Gharb Basin, which includes the Sebou Central, Gharb Occidental, Moulay Bouchta Ouest, and Lalla Mimouna Sud exploration permits, plus a number of exploitation concessions containing the producing wells.
SDX says it has entered into a non-binding Heads of Terms with a large multinational operator to divest of all of its Egyptian assets in a move to optimize its asset portfolio and focus on the Moroccan energy transition sector. The company expects to close the transaction by the end of 2023.
SDX states that the “Disposal will position the company for upcoming diversification into Morocco’s energy transition sector. Moving towards the energy transition narrative also gives access to a wider pool of capital, setting SDX on a new path of growth with the ultimate aim of delivering sustainable returns for shareholders.”
The Disposal will require the consent of SDX shareholders being given in a general meeting. Completion of the Disposal will be subject to, among other conditions, the negotiation of final transaction documentation and obtaining Egyptian government approvals for the sale. The Heads of Terms are non-binding and, therefore there can be no certainty that the Disposal will complete, SDX states.
Once the sale goes through, “SDX, re-energized with new management, will focus on monetizing exciting opportunities around its Moroccan assets and related energy transition sector-plays”, says Daniel Gould, Managing Director. This is “in oder to reward and deliver capital growth to our shareholders in the near term.”
Angola’s upstream hydrocarbon regulator, the National Oil, Gas and Biofuels Agency (ANPG), has signed Production Sharing Contracts (PSA) with the French major TOTALEnergies, the ENI/BP SPV Azule Energy and the Norwegian independent Equinor, for Blocks 16/21 and 31/21, located in deep and ultra-deep waters, respectively, in the Lower Congo Basin.
Block 16/21 is close to TOTAL operated Block 17 , the largest producing block in the country, while Block 31/21 has a total of 12 discoveries, “in addition to remaining exploration potential in an area with the Block’s existing infrastructure. 31 PSVM”, the ANPG says in a statement.
“The challenges related to global competition, the current volatility of the price of a barrel of oil, which is directly linked to factors that transcend us, did not prevent the conclusion of this process, demonstrating once again that the large oil companies continue to consider Angola as a preferred location and choice to make your investments”, declared Paulino Jerónimo, President of the Board of Directors of ANPGy, this is yet another achievement that demonstrates the positive results of the Strategy designed by the Angolan Executive for the oil sector.
The contracts result from the 2021 Bidding process that led to the creation of contracting groups formed by TOTALEnergies, to operate Block 16/21, with a 100 percent stake, and by Azule Energy (operator) and Equinor, both for the Block 31/21, with 50 percent participation interest, each.
Mozambican authorities are finalising negotiations with the two consortia that won the 6th international tender (bid round) for hydrocarbon exploration and production.
“Negotiations are almost over and by the end of this year at the latest the contracts will be presented to the government so that it can approve them and start operations,” said Carlos Zacarias, the country’s Minister of Mineral Resources and Energy.
The two consortia who won were led by ENI, the Italian explorer and China National Offshore Oil Corporation (CNOOC), the Chinese behemoth.
Zacarias explained that the Mozambican cabinet is studying the possibility of launching more bid rounds in the short term, as the government considers the country as having significant volume of yet unexplored hydrocarbons.
The minister was speaking at the closing ceremony of the 8th Coordinating Council of the Ministry of Mineral Resources and Energy.
“Taking advantage of the energy resources that Mozambique has, becomes more pertinent given the period of energy transition that the world is going through,” he emphasised.
Mozambique has three development projects approved to exploit the natural gas reserves in the Rovuma basin, considered one of the largest in the world and are located off the coast of Cabo Delgado province.