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Angola’s Regulator Issues Tender Notice for Environmental Study of the Kassanje Basin

The NATIONAL AGENCY FOR OIL, GAS AND BIOFUELS (ANPG) makes public, under the terms of paragraph 1 of article 69 and of annex VI, of Law 9/16, of 16 June, Law on Public Contracts, the Limited Tender for Previous Qualification for the Provision of Environmental Impact Study Services, Restoration and Repopulation of the North and South lots of the Kassanje Basin is opened, within the scope of the Petroleum Potential Study Project of the Interior Basins of Angola.

Deadline and place for the Submission of Proposals: Until December 18, 2020 at 4:00 pm, at the following address: Rua Lopes de Lima, Urban District of Ingombota, Municipality of Luanda, Torres do Carmo Building – Tower 2 4th floor Tel. ( +244) 226 428 000

Full details in this link.


UNESCO inks Cooperation Agreement with Gas Exporters

United Nations Educational, Scientific and Cultural Organisation (UNESCO) and the Gas Exporting Countries Forum (GECF) have signed a Memorandum of Understanding (MoU) to bring the benefits of collaboration to the world at large.

Shamila Nair-Bedouelle, the Assistant Director-General for Natural Sciences at UNESCO and Yury Sentyurin, the Secretary General of the 20-member coalition of the leading gas exporting countries of the world, signed the agreement, which “will serve as a gateway of opportunities between the two entities in the areas of struggle against climate change, natural resources management, and positive developments across the globe, particularly in the Africa region”, according to a GECF release.

“The partnership will further allow the sides to focus on capacity building, technical support, and shared expertise”, the statement adds.

The GECF comprises of 20 member countries, of which six (6), or 30%, are African countries, including Algeria, Angola, Egypt, Equatorial Guinea, Libya and Nigeria. Other members include Bolivia, Iran, Qatar, Russia, Trinidad and Tobago, Venezuela, Azerbaijan, Iraq, Kazakhstan, Malaysia, Norway, Oman, Peru, and the United Arab Emirates. The GECF member countries  jointly control 71% of the proven gas reserves, 45% of its marketed production, 53% of pipeline, and 60% of LNG exports across the globe. It is headquartered in Doha, Qatar.

The MoU has been signed against a unique backdrop. The world’s overall energy demand is assumed to grow along with the global economy and population growth. The GECF experts forecast that in order to fulfil this increased demand, the world will likely see a symbiosis of conventional and renewable energies to solve climate issues and to meet the needs of nations for affordable energy. Natural gas is expected to shoulder the bulk of this demand on the back of its attributes of being the most environmentally friendly, affordable, flexible, and abundant fossil fuel

Natural gas is projected to become the largest source of primary energy by 2050, from currently 23% to 28%, according to the latest data available from the GECF Global Gas Outlook 2050. Along the way, natural gas is expected to play a vital role in decarbonisation options including natural gas-based hydrogen, also known as the blue hydrogen, with carbon capture, utilisation and storage (CCUS) technologies.

“The mobilisation of science for the benefit of society and the planet is now more urgent than ever. We need science and technology, we need access to science and technology, we need to be able to reduce the knowledge gap between different countries across the world, and therefore this partnership with the GECF is really a beacon of hope and light,” said Nair-Bedouelle, following the virtual signing ceremony. “The GECF serves as a platform for the science policy interface, underpinning the importance of the exchange of scientific knowledge, experience, and dissemination of information through research and production of global outlooks and statistical bulletins”, she explained, adding that UNESCO is “confident that this partnership will further harness the potential of science and technological cooperation to address global challenges, through advocacy and awareness raising at all levels of society and economic sectors towards achieving the sustainable goals of the 2030 Agenda and beyond.”

Scientifically-grounded data and insights are championed at the GECF, whose Secretary General emphasised that technology is key to the envisaged energy transition and climate action such as greenhouse gasses (GHGs) emissions mitigation. “Education and science-oriented exercises play a great role in environmental protection with a view to raise awareness and cultivate a “culture of energy responsible behaviour” or “energy scholarship,” Mr. Sentyurin noted. “The GECF is developing technologies, including ones in relation to reduction of GHGs emissions through the GECF Gas Research Institute, recently established in Algeria, and fully dedicated to discovering new technologies and innovations to achieve the ambitious sustainable development goals in front of us,” the GECF Secretary General added.

“The GECF’s ambition to steward the gas industry into playing a greater role in environmental protection manifests in our Environmental Knowledge and Solutions initiative. This 12-point agenda focuses on many aspects of our activities,” Sentyurin declared, while referring to the 2019 Malabo Declaration adopted by the GECF Heads of State and Government, which calls on the Forum to use natural gas as the core source of energy in the development programmes and climate change policies of developing countries, such as in Africa, to overcome energy poverty and to mitigate CO2 emissions.

As an observer organisation to the UNFCCC (UN Framework Convention on Climate Change), the GECF actively participates in the conference of parties, with the most recent statements made at COP24 and COP25. The Forum is also a regular contributor to the discussions of the UN Economic Commission for Europe (UNECE) Group of Experts on Gas, where it analyses natural gas’ leading role in attaining the 2030 Agenda for Sustainable Development.

“This is complemented by our rapidly growing relationships with the G20, BRICS, and others in the spirit of joint action as regards to humanity’s shared mission of sustainable development,” Sentyurin concluded.

 

 

 

 


In Angola, Production Cost of $20-25 Per Barrel is “Fairly Good”

By Macson Obojemuinmen

Sebastião Gaspar Martins, chairman of Sonangol, says that a production cost of $20 to $25 per barrel is “fairly good cost” for Angolan marginal fields, which the government is proposing to offer in a bid round. “When we say high production costs, we are looking at no more than $20-25 per barrel, which is still fairly good. If prices stabilise around $50-55 per barrel by the end of 2020, we might be well within the range to be able to secure gains from the development of marginal fields”.

Angola defines marginal fields as crude oil and gas deposits which, due to costly recovery processes, are not worth the investment under the existing legal and fiscal framework. Several of the prospects found over the years in the country’s deep offshore, were dismissed in the pursuit of more profitable opportunities. A new framework, published in May 2018, considers, as marginal fields, those discoveries with proven oil reserves of less than 300Million barrels (exceptions are considered for bigger reserves in particularly expensive working conditions), standing at or below 800 metres of water depth, that do not give returns to the State of more than $10.5 per barrel, returns for the operator of no more than $21 per barrel and that have an average return on investment after taxes of less than 15%.

“Production costs are essential in deciding whether a project moves forward or not. Deep and ultra-deep waters come with very high production costs and we know that can jeopardise upstream activity in the current industry climate”, Martins explains. “One of the ways to overcome the high costs associated with the development of offshore fields is by utilising new technologies and ensuring high rates of production.
“We currently have some marginal fields (onshore and offshore) where fiscal terms can be improved in such a way that the projects can be viable even with high production costs”.

First published in the September/October 2020 issue of Africa Oil+Gas Report

 


In Senegal, Woodside Wants it All

Barely three months after pre-empting the sale of Cairn Energy’s interest in the Senegalese oilfield development and adjoining discoveries to a third party, Woodside Energy has made the same move on a similar transaction by FAR.

In mid-August 2020, the Australian explorer executed its right of first refusal to Cairn Energy’s sale of its 40% interest to LUKOIL, the Russian giant.

Last weekend, it pre-empted the sale of FAR’s i15% interest to the Indian company ONGC.

If Woodside successfully acquires both Cairn’s and FAR’s interests, its working stake in the Sangomar exploitation area will be 82%, with the state owned Petrosen holding 18%. The working interest in the remaining Rufisque, Sangomar and Sangomar Deep (RSSD) evaluation area (including the FAN and SNE North oil discoveries) will be Petrosen 10%, and Woodside 90%.

That is if the Senegalese authorities approve the transactions, as they are.

But Woodside is not there yet.

Although Cairn Energy PLC shareholders voted in favour of the sale and purchase agreement for Cairn Energy’s stakes on 23 September 2020, the transaction with FAR still depends on the outcome of a shareholder meeting, scheduled for December 21, 2020. “The shareholder meeting documentation expressly contemplated that such authorisation would cover the exercise of a pre-emptive right”, FAR says in a release.

Woodside has offered FAR the exact terms of the FAR/ONGC Transaction, including: • Payment to FAR of $45Million • Reimbursement of FAR’s share of working capital, including any cash calls, from 1 January 2020 to completion • Entitlement to certain contingent payments capped at $55Million.

Woodside says that the acquisition will be funded from current cash reserves.

Woodside CEO Peter Coleman said the acquisition of FAR’s participating interest makes the value proposition for Sangomar even more compelling. “Sangomar is an attractive, de-risked asset in execute phase, offering near-term production. The acquisition is value accretive for Woodside shareholders and results in a streamlined joint venture which will assist in our targeted sell-down in 2021”.


TOTAL Flows 4,330BPD of Condensate in South African Discovery

By Toyin Akinosho

French explorer TOTAL, has finalised a drill stem test on the Luiperd-1X well, its second major discovery on Block 11B/12B offshore South Africa.

The well was opened to flow on November 1, 2020.

After several tests at different choke settings, the well reached a maximum constrained flowrate through a 58/64″ choke of 33Million standard cubic feet per day of natural gas (MMscf/d) and 4,320 barrels of condensate per day (BCPD), an aggregate of approximately 9,820 barrels of oil equivalent per day (BOEPD), according to a report by Africa Energy, a junior partner on the asset.

”The choke configuration could not be increased due to surface equipment limitations”, Africa Energy explains. “The absolute open flow (AOF) potential of the well is expected to be significantly higher than the restricted test rates”.

TOTAL itself had reported the Luiperd-1X discovery last October, stating that the probe intersected 85 metres gross sands of which 73 metres is net good quality pay in the main target interval and thicker than prognosed.

The well reached total depth of approximately 3,400 meters on October 12, 2020, at which point the drill stem testing programme was initiated.

Africa Energy commented: “We are very pleased with the positive test results that show high condensate yield and excellent reservoir connectivity. These results confirm the joint venture’s decision to proceed with development studies and to engage with authorities about commercialization.”

Block 11B/12B is located in the Outeniqua Basin 175 kilometres off the southern coast of South Africa. The block covers an area of approximately 19,000 square kilometers with water depths ranging from 200 to 1,800 metres. The Paddavissie Fairway in the southwest corner of the block now includes both the Brulpadda and Luiperd discoveries, confirming the prolific petroleum system. The original five submarine fan prospects in the fairway all have direct hydrocarbon indicators as recorded on both 2D and 3D seismic data and intersected in the wells, significantly de-risking future exploration.

Africa Energy holds 49% of the shares in Main Street 1549 Proprietary Limited, which has a 10% participating interest in Block 11B/12B. Total E&P South Africa B.V. is operator and has a 45% participating interest in Block 11B/12B.

Africa Energy says it believes Luiperd and Brulpadda can potentially support a significant commercial development.”

 


Accugas Is One of the Top Four  Nigerian Domestic Gas Suppliers

With 113.5Millon standard cubic feet per day (113.5MMscf/d) averaged in 1H 2020, Accugas Limited has indicated itself as one of the top four natural gas suppliers to the Nigerian economy. The company is a subsidiary of the British headquartered Savannah Petroleum, which bought over the assets of Seven Energy in Nigeria. Accugas’ main hydrocarbon property is the Uquo gas field in Oil Mining Lease (OML) 13 onshore eastern Niger Delta basin.

Accugas’ competitors are Chevron. NDWestern and Seplat, the country’s biggest suppliers of natural gas to the domestic market. But unlike Accugas, all of them are in joint venture with either the Nigerian National Petroleum Corporation or its operating subsidiary, the NPDC. Between January and June 2020, the average gross natural gas output of these three JVs ranged from 222 to 320MMscf/d. This means that, on an equity basis, the output of Chevron, Seplat and NDWestern ranged between 99 and 144MMscf/d. By comparison Accugas’ 113.5MMscf/d average, in that period, is competitive.

The company increased its average gross daily natural gas production from the Uquo gas field  by  22.4% compared to the same period last year, from 92.7 MMscf/d (15.4 KBOEPD) to 113.5 MMscf/d (18.9 KBOEPD).

“In H1 2020, Accugas increased gas supply to the Nigeria power sector by 35% versus Q4 2019. This compares to wider industry performance which saw the gas shortage to supply the Nigerian power grid increasing by 33% versus Q4 2019”, Savanah Petroleum says in a statement.

The company achieved an all-time Nigerian Assets gas production record of 177 MMscf/d on 30 May 2020. While Accugas’ customers achieved an all-time record peak contribution of 11.5% of Nigeria’s electricity generation or 486MW on 23 May 2020, with the contributed electricity being exclusively generated from Accugas sales gas.

On 31 January 2020, Accugas entered into the first new gas sales agreement for the business in over five years with First Independent Power Limited, an affiliate company of the Sahara Group, for the provision of gas to the FIPL Afam power plant. Accugas is in the process of working with FIPL to validate the third-party infrastructure required to enable the commencement of gas sales.

In June 2020, Accugas signed a term sheet with a significant new industrial gas sales customer, a subsidiary of a well-respected international company, for an initial quantity of up to 5 MMscfpd of gas for an initial five-year period.

 

 


Kenya, in Defiance, Plans to auction More Coal Licences

By Macson Obojemuinmoin

Kenya plans to auction additional coal blocks in the east of the country, in defiance of growing international calls to end coal use in the global energy mix.

The government is pushing to exploit the deposits in the Mui Basin, often reported by the media to be rich deposits, but, like most media reports of geologic provinces, with scant evidence of the definitive size of the asset. Mui Basin has witnessed a total of 71 exploration and appraisal wells, most of them drilled in Block C to depths ranging from 75 to 445 metres. Some 32 wells have intersected coal.

The Energy ministry, through the Energy and Petroleum Regulatory Authority (EDRA), has conducted licencing rounds in the basin since 1999, covering an area of 500 square kilometres.

Last year, the African Development Bank (AfDB) said it would not fund a coal-fired power plant project in Kenya and has no plans to finance new coal plants in future. The pan continental lender published an environmental and social impact assessment in May 2019 for the Lamu project, which was planned to be a 1,050 megawatt plant in eastern Kenya was backed by Kenyan and Chinese investors. Construction was originally planned to start in 2015.

Akinwumi Adesina, the AfDB president, unveiled ambitious plans to scrap coal power stations across the continent and switch to renewable energy. “Coal is the past, and renewable energy is the future. For us at the African Development Bank, we’re getting out of coal,”Adesina said as he outlined efforts to shutter coal-fired power plants and build the “largest solar zone in the world” in the arid Sahel belt.

But Kenya’s energy and business analysts have lined up behind the government. George Wachira, the country’s top energy analyst, wrote last year in BusinessDaily, the influential financial newspaper,  that coal was a commodity which cuts across mining, energy and manufacturing economic sectors. “It is mainly used for power generation and for providing heating energy to heavy industries like cement and steel. Locally produced coal has the potential to become an economic integrator with large employment and gross domestic product (GDP) opportunities. Like crude oil, coal is an extractive and productive resource that creates real national wealth”.

EPRA, the energy regulator, says that “the government has decided to concession all four blocks (in the Mui Basin) to private companies through a competitive international bidding process, to fast-track exploration, development and production.”

 


ENI Set to Re-Start the Damietta LNG Plant in Egypt

By Bunmi Aduloju

Italian player ENI says it has signed a series of agreements with the Egyptian government, two of the country’s state hydrocarbon firms and a Spanish firm, paving the way for the restart of the Damietta liquefaction plant in Egypt by the first quarter of 2021.

The state hydrocarbon firms include the Egyptian General Petroleum Corporation (EGPC) and the Egyptian Natural Gas Holding Company (EGAS). The Spanish company is Naturgy.

The agreements culminate in the amicable settlement of the pending disputes of Union Fenosa Gas and SEGAS with EGAS and Arab Republic of Egypt and the subsequent corporate restructuring of Union Fenosa Gas itself, whose assets will be shared between the partners ENI and Naturgy.

The liquefaction plant’s owner is the company SEGAS, which is 40% owned by ENI through Union Fenosa Gas (50% ENI and 50% Naturgy). The plant has a capacity of 7.56Billion cubic meters per year, but has been idle since November 2012.

The agreements, signed on December 1, 2020, are in line with the ones finalized last February and take into account the evolution of the energy scenario, allow to reinforce ENI’s strategic objectives in terms of growth of its LNG portfolio, in particular in Egypt, where the Company is the main gas producer, and are of primary importance for all parties involved to resolve all pending disputes.

“The operation, subject to the authorization of the European authorities and subject to the fulfilment of certain conditions precedent, allows to strengthen the presence of ENI in the Eastern Mediterranean, a key region for the supply of natural gas, an important resource for the energy transition”, ENI says in a statement.

“The participation of Union Fenosa Gas in the Damietta plant (80%) will be transferred 50% to ENI and 30% to EGAS. The resulting shareholding of SEGAS will therefore be ENI 50%, EGAS 40% and EGPC 10%. ENI will also take over the contract for the purchase of natural gas for the plant and will receive corresponding liquefaction rights, thus increasing the volumes of LNG in its portfolio by 3.78Billion cubic meters per year, which will be available on an FOB basis, with no destination restrictions”., the company explains.

As regards Union Fenosa Gas’ assets outside Egypt, ENI will take over the commercial activities of natural gas in Spain, strengthening its presence in the European gas market.

The agreement comes at an important moment, when also thanks to the fast time to market of ENI’s natural gas discoveries, especially the ones in the Zohr and Nooros fields, Egypt has regained its full capacity to meet domestic gas demand and can allocate surplus production for export through its LNG plants.

 


Otakikpo Phase 2 Drilling: Just A Little Delay

Green Energy and Lekoil are working through financing to fund the second phase development of the Otakikpo marginal field in eastern Nigeria, currently producing around 6,000Barrels of Oil Per Day.

There has been a little delay, as the drilling was earlier expected to have commenced in October 2020.

The funds are to come from a consortium of financiers, including Standard Chartered Shell Trading and an EXIM bank.  Drilling may now start by early December.

The original plan was to increase production from 6,000 barrels per day (BOPD) to 20,000BOPD, but the prevailing conditions may keep the immediate ramp up to around 12,000BOPD.

Schlumberger is the main subsurface service vendor.

Green Energy had signed a Memorandum of Understanding (MoU) with a consortium of international financiers for a package of more than $350Million, for the project funding.

The Field Development Plan FDP of the project involves the drilling of seven additional wells (there are two producing wells already) and expansion of the crude processing infrastructure. The plan also includes the construction of a 1.3Million barrels onshore terminal and a 17 kilometre export pipeline to connect the terminal to an offshore loading system.

 


Libya’s Arabian Gulf Oil …General Tender Extension No. (MTC-19/2020)

Arabian Gulf Oil Company, in Libya, intends to upgrade and Tie-in new wells into the existing cathodic protection system (Nafoora) Turnkey project Project no P-22

Deadline for tender is: 14:00 Hours, Monday, December 21, 2020.

Description of work:

Reinstating the Cathodic Protection (C.P.) to a number of wells to the northeast of main areas of exploratory wells, namely “K pool”, “L pool” & “O pool”, (V & Y).  It is proposed now that the individual well casings, flow lines, satellites, trunk lines, and GOSP (as applicable) be protected by transformer rectifiers instead of the existing vandalized Solar Energy Units (SEUs).  Where feasible, four (4) wells shall be protected by one (TR).

–  reinstating Cathodic Protection for Fajr Field (GOSP-8) facilities. Drill &            case new DGBs and install new “MMO” anodes firmly secured to dual   jacketed cables with a double compression crimp. All (9) TRs be refurbish, all AJBs be replaced. Checking I/Fs & Spark gaps if required.

–  Drill & case twelve (11) new DGB around various GOSPs.

– replace sixty (59) lost or defective magnetite anode strings around various GOSPs.

– incorporating (25) newly-drilled Wells around the various GOSPs and previously unprotected structures. It will be necessary to connect these wells to C.P system and install new Insulating Flanges (I/Fs) in the wellheads and flow lines where it is possible or new C. P stations are required.

Details of the Bidding procedure are provided in this link.

 

 

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