All posts tagged farm


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.”

 

 

 


Michael Ajukwu Takes the Chairmanship of LEKOIL 

Michael Onochie Ajukwu, a Nigerian businessman, has been named Chairman of LEKOIL Limited, after Metallon Corporation succeeded in getting the three directors it nominated into the company’s board of directors, at the Extraordinary General Meeting (EGM) of the company on January 8 2021.

He takes over from Mark Simmonds, the British diplomat and politician, who had been in the position for just about a year.

Mr. Simmonds is as high profile as they come. He was Britain’s Foreign & Commonwealth Office Minister with responsibilities for Africa, the Caribbean, UK Overseas Territories, International Energy and Conflict Prevention. He served as a Member of the UK Parliament for fourteen (14) years and was also a senior advisor to the then Prime Minister, David Cameron.

Simmonds took over the Chairmanship at a time of huge reputational challenges for LEKOIL: the company’s shares were in a headlong crash in January 2020, after the AIM listed firm discovered that a $184 Million loan it had announced was fraudulent.

But LEKOIL had not been able to live down the smear. And it was one of the issues that Metallon Corporation raised, two months after it bought 15% share of the company and moved in for board changes.

“I am honoured to assume the position of Chairman of LEKOIL and would like to thank my predecessor, Mark Simmonds, for his contributions to the Company”, Ajukwu, known in Lagos  business circles for his closeness to South African brands and Nigerian banking interests, said. “I look forward to working with my colleagues on the Board and the management of LEKOIL to deliver a high performing company anchored on strong governance structures that produces value for all shareholders.”

The path to Mr. Ajukwu’s chairmanship was cleared when Mr. Simmonds chose to step down as Chairman at the EGM and all resolutions that Metallon put to the meeting were duly passed, with Metallon’s nominated directors, including Michael Ajukwu, Thomas Richardson and George Maxwell invited to join the Board with immediate effect.

Mr. Simmonds noted his intention to stand down from board Chairmanship role with immediate effect with a new Chairman to be appointed by the enlarged board of directors.

 


FAR May Not Yet Ride into the Sunset, Afterall

Australian junior FAR Limited has cautioned that the proposed acquisition of all of its shares by Remus Horizons PCC has a dim chance of happening.

“The Remus Proposal terms are uncertain at this stage”, the company declares in a statement early on Friday, January 8, 2021.

The most significant lie in the release goes thus: “The Remus Proposal is conditional on the Woodside Sale not occurring”. Meaning: If FAR’s shareholders agree to sell the company’s 15% stake in Senegal’s Sangomar oilfield development to Woodside, then Remus will not move ahead.

“FAR cautions that the Remus Proposal is not a legally binding offer, there is no certainty that the Remus Proposal will necessarily eventuate, and the Remus Proposal terms are uncertain at this stage”, FAR explains.

“Accordingly, care needs to be used in assessing the Remus Proposal at this time. The Remus Proposal is conditional on the Woodside Sale not occurring”.

FAR says it has obtained further information from Remus in relation to the Remus Proposal as follows:

  • Remus is presently finalising the funding arrangements in advance of making the proposed offer.
  • The only internal and regulatory approval required to proceed with the offer is the final approval of the Remus Board and final review and confirmation of documentation.
  • Remus is presently satisfied that it will not need to undertake any further due diligence on FAR.
  • FIRB approval is not required and any offer made will not be conditional on FIRB approval.
  • Any proposed offer is expected to be subject to a requirement that Remus achieves a controlling interest in FAR together with other customary conditions.

“In these circumstances, FAR has determined to further postpone the shareholder meeting to consider approving the Woodside Sale currently scheduled for 21 January 2021 to 10.00 am on 18 February 2021. This will enable further time for FAR shareholders to see if the Remus Proposal eventuates, if so assess its merits, and consider the Woodside Sale on the basis of more detailed information. FAR will in due course distribute updated meeting information in this regard. FAR is not presently inclined to further postpone the shareholder meeting to consider updates in relation to the Remus Proposal. In the meantime, FAR is continuing to advance negotiations with Woodside in relation to the form of the Woodside Sale proposed contractual documentation following Woodside’s pre-emptive rights exercise. FAR advises that it is in the process of paying the RSSD project November 2020 cash call ($8.96Million plus interest) and the December 2020 cash call

 


TOTAL Annexes a New Acreage in East Mediterranean

French supermajor TOTAL says that an international consortium it is leading has signed an exploration and production agreement with the Egyptian Natural Gas Holding company (EGAS) for the North Ras Kanayis Offshore block located in the Herodotus Basin, offshore Egypt in the Mediterranean Sea.

TOTAL will operate the block with 35% equity. AngloDutch giant Shell holds 30%, with Kuwait Foreign Petroleum Exploration Company (KUFPEC) having 25%. Tharwa Petroleum, an Egyptian state hydrocarbon firm, holds the remaining 10%.

North Ras Kanayis is an exploration acreage covering 4,550 square kilometres, extending from 5 to 150 kilometres from the shore, with water depths ranging from 50 to 3,200 metres. The Herodotus Basin is an underexplored area and the agreement includes a three dimensional (3D) seismic campaign during the first three years.

‘‘TOTAL is pleased to further strengthen its Eastern Mediterranean position as an operator of this exploration and production agreement’’, commented Kevin McLachlan, the French major’s Senior Vice President Exploration. “We are excited by the exploration potential of the North Ras Kanayis Offshore block. It reinforces our presence in Egypt, following a gas discovery made in July 2020 with the Bashrush well on the North El Hammad license, to be developed through a tie-in to nearby existing infrastructure.”

TOTAL holds a working interest of 25% in the North El Hammad license, alongside operator ENI (37.5%) and BP (37.5%)


Serica Walks Out of Namibia

British junior, Serica Energy has decided to walk away from its Licence 047 in Namibia, covering Blocks 2512A, 2513A, 2513B and part of 2612A.

It is exiting the South West African country, nine years after it was originally awarded the assets.

Serica, a gas focused company with relatively extensive UK operations, has basically sat down on its Namibian portfolio for all of those nine years.

It admitted this much in its statement: ”The initial work commitment was fulfilled when BP farmed-in to the licence and funded a 3D seismic survey at no cost to Serica. In late 2013, BP decided to exit the licence rather than making a commitment to drill in the next licence period”.

Serica claims it “continued with its technical work to interpret the seismic and geological data, and secured extensions to the licence and waivers on area relinquishment and well commitments”.

Having just been formally awarded four new blocks in the UK’s 32nd licensing round and seeing gas prices trending up, it has opted “to withdraw from Namibia to focus on Serica’s North Sea-focused portfolio and opportunities”.

“The pace of exploration activity in Namibia has been slower than we hoped, and the development of any discovery would likely have been expensive, time consuming and inconsistent with our sustainability objectives”.


FAR Is About to Ride into the Sunset

FAR Limited, the Australian minnow which brands itself as a key player in Africa’s Northwest margin, may soon be swallowed.

If the company’s shareholders agree to a proposal from Remus Horizons PCC Limited, a private investment fund regulated by the Guernsey Financial Services Commission, FAR, an explorer with holdings in Senegal, Gambia and Guinea Bissau; the MSGBC axis where hub sized hydrocarbon resources have been found in the last eight years, will be gone.

Things are still in a preliminary stage. FAR cautions that “the Proposal is not a legally binding offer, there is no certainty that the Proposal will necessarily eventuate, and that the Proposal terms are uncertain at this stage. Accordingly, care needs to be used in assessing the Proposal”.

Remus’ move is “conditional non-binding indicative, to engage in further discussions and further investigations for the purpose of evaluating its capacity to make an offer or announce an intention to make an offer to acquire 100% of the shares of FAR at 2.1c cash per share.

Remus has stated that the price represents a premium to the cash backing per share that would exist if FAR was to complete the sale of the Rufisque Offshore, Sangomar Offshore, Sangomar Deep Offshore (RSSD)project to Woodside Energy (which pre-empted the earlier proposed sale to ONGC Videsh.

Remus has also stated that it is conditional (amongst other things) on: –

The FAR shareholder meeting to consider approving the sale of the RSSD project scheduled for Monday 21 December 2020 being rescheduled. –

  • FAR providing access to management and information in relation to the RSSD project and Remus being satisfied with such information.
  • No superior proposal emerging. Remus has stated that the Proposal will be funded from available internal cash reserves and that any formal binding offer would not include any financing conditions. Remus has stated that Remus is willing to discuss the possibility of making available a zero coupon bridge loan to FAR of up to $50Million from the date of any binding offer on terms and subject to conditions to be agreed to enable FAR to meet its valid funding calls in relation to its interest in the RSSD project and other necessary working capital requirements.
  • Remus has stated that it is well placed to move quickly to complete its confirmatory investigations and has committed to engage collaboratively with FAR to progress the Proposal.

FAR says it is seeking clarification from Remus regarding various aspects associated with the Proposal. In these circumstances, FAR has determined to postpone the shareholder meeting currently scheduled for 21 December 2020 to 10.00 am on 21 January 2021. “This will enable further time for FAR and its shareholders to be able to obtain further information in relation to the Proposal and assess the relative merits of the sale alternative and the Proposal. FAR will in due course distribute updated meeting information in this regard. FAR has appointed Baker McKenzie to advise in relation to the Proposal”.


Angola Invites Tenders for Logistics Services for Kassanje Basin Study

Angola’s NATIONAL AGENCY FOR PETROLEUM GAS AND BIOFUELS (ANPG) has thrown open the tender for Acquisition of Assistance and Logistical Support Services for the North and South Lots of the Kassanje Basin, within the scope of the Petroleum Potential Study Project of the Interior Basins of Angola.

Deadline and place for the Submission of Applications: Until December 30, 2020 at 3 pm

Contract performance period: 12 months.

Fuller description of the tender is in this link


Equatorial Guinea Grants Two Year Extension for All Oil & Gas Licences

One month after it announced the waiving of its fees for oil service companies in the country, Equatorial Guinea has granted E&P companies a two-year extension on their exploration programmes.

The grant, the country says, “will also ensure flexibility on the work programmes of producing companies to ensure growth and stability in the market”.
In late March, the Ministry of Mines and Hydrocarbons MMH said it took the unanimous decision to waive its fees for service companies for a duration of three months, adding that it recognised the fact that the oil sector continues to be the largest private sector employer in the country and “we want to give our local services companies the means to weather the storm and avoid any jobs being lost”. It said it was “the first action to be taken to support oil & gas services companies in the wake of the oil price drop caused by the coronavirus pandemic”.

Oil prices have headed farther south in the four weeks since that first announcement, with the horizon even cloudier. Yesterday’s press release announcing the grant of extension of tenor of acreage licences came less than a week after the Petroleum minister, Gabriel Mbaga Lima Obiang, suggested at a webinar that countries should be granting extensions for E&P licences at this time, as companies would be unable to carry out work programmes with any clarity until 2021.

“The Ministry of Mines and Hydrocarbons remains concerned about the resounding impact of the drop in oil prices, COVID-19 and its dramatic consequences on our hydrocarbons industry”, says the release.

“At a time of great uncertainty, we have an obligation to make bold, decisive, and pragmatic policy decisions to get the industry moving again,” the statement explains, adding  that the government is fully committed to safeguard local oil & gas industry, its companies and its employees.

“The granting of these extensions has been deemed suitable to create an enabling environment for international and African companies to keep investing in Equatorial Guinea and ensure a quick recovery of our industry.

“The MMH will continue working with oil companies benefitting from such incentives to make sure that the recovery of Equatorial Guinea’s oil sector is made on the back of local content promotion, increased technology transfers, and procurement of additional local goods and services. A particular emphasis will be put on educating, training and promoting local workforce to help further reduce operational costs for international companies while maximising the creation of local value and revenue”.

With these proposals, the Equatoguinean authorities say they guarantee existing investments into Equatorial Guinea, while empowering local companies to assist their foreign partners in safeguarding and increasing their operations in the country.

“Some of these companies operating in Equatorial Guinea notably include ExxonMobil, EGLNG, Marathon Oil Corp, Atlas Petroleum, Kosmos Energy, Noble Energy, Glencore, Royal Gate Energy, Gunvor, Trident Energy, etc.

“Such historic measures are being rolled out as Equatorial Guinea implements a series of landmark projects across its upstream, midstream and downstream industries. The backfill project is already ongoing to pool supply from stranded gas in the Gulf of Guinea and replace declining output from the Alba Field. Meanwhile, the ongoing Year of Investment has generated strong interest from various existing and new players in Equatorial Guinea to build and expand midstream and downstream infrastructure and maximise local processing and transformation of domestic crude oil and natural gas.”


TOTAL Swallows Tullow A whole in Uganda

The drawn-out deal is concluded at $2 per barrel

French major TOTAL and Irish independent Tullow have entered into an Agreement, through which TOTAL shall acquire Tullow’s entire interests in the Uganda Lake Albert development project, including the East African Crude Oil Pipeline.

The overall consideration paid by TOTAL to Tullow will be $575Million, with an initial payment of $500Million at closing and $75Million when the partners take the Final Investment Decision to launch the project. In addition, conditional payments will be made to Tullow linked to production and oil price, which will be triggered when Brent prices are above $62/bbl. The terms of the transaction have been discussed with the relevant Ugandan Government and Tax Authorities and agreement in principle has been reached on the tax treatment of the transaction.

Under the terms of the deal, TOTAL will acquire all of Tullow’s existing 33.3334% stake in each of the Lake Albert project licenses EA1, EA1A, EA2 and EA3A and the proposed East African Crude Oil Pipeline (EACOP) System.

The transaction is subject to the approval of Tullow’s shareholders, to customary regulatory and government approvals and to CNOOC’s right to exercise pre-emption on 50% of the transaction. “We are pleased to announce that a new agreement has been reached with Tullow to acquire their entire interests in the Lake Albert development project for less than 2$/bbl in line with our strategy of acquiring long-term resources at low cost, and that we have an agreement with the Uganda government on the fiscal framework,” said Patrick Pouyanné, TOTAL’s Chairman and CEO. “This acquisition will enable us, together with our partner CNOOC, to now move the project forward toward FID, driving costs down to deliver a robust long-term project.”


Equatorial Guinea Grants Relief to Oilfield Service Companies

The country has acted to support its services industry and is engaging on an industry-wide dialogue to study other measures for upstream operators and ongoing midstream projects

The Ministry of Mines and Hydrocarbons (MMH) of the Republic of Equatorial Guinea decided on the waiving of its fees for service companies in the country.

The country says it is the first action to be taken to support oil & gas service companies in Equatorial Guinea in the wake of the oil price drop caused by the coronavirus pandemic. Oil prices currently remain at around $20 a barrel, a historically low level since prices broke the magic $25 in the early 2000s

“The Ministry of Mines and Hydrocarbons took the unanimous decision to waive its fees for services companies for a duration of three months,” declared Gabriel Mbaga Obiang Lima, the Minister of Mines and Hydrocarbons. “We recognize that the oil sector continues to be the largest private sector employer in the country and want to give our local service companies the means to weather the storm and avoid any jobs being lost. While it is important to let market forces determine the future, the government does have a role to play in stimulating the market and creating an environment for these companies to stay strong, continue investing and create opportunities for our citizens,” he added.

Jobs security and the safety of Equatorial Guinea’s citizens have been put at the top of priorities for the MMH, which has further pledged to keep engaging with local and international companies to create the right kind of enabling environment for the sector to operate and grow despite current circumstances.

International operators will need to keep complying with local content requirements in Equatorial Guinea throughout the downturn, and make sure to work with the local services industry to adapt to new market dynamics. This is the first such measure to be taken in Equatorial Guinea, which will consider additional action to bring relief to its oil & gas sector.

The statement added: “The ongoing coronavirus pandemic has brought the world economy to a halt and critically affected oil demand. As a result, prices have been brought to one of their lowest levels in a long time, which brings considerable instability to African oil producers in the Gulf of Guinea.

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