All posts tagged feature


OPEC+Cut: Nigeria Orders Egina Field Output Reduced by 40%

French Major TOTAL produced 131,000Barels of Oil Per Day (BOPD) from Egina for the entire month of May, a figure that is 33% less than the April 2020 production, which averaged 201,000BOPD.

The May 2020 volume was decreed by the Crude Oil Marketing Division (COMD) of the NNPC, the Nigerian state hydrocarbon company, “as part of Nigeria’s commitment to comply with agreement reached by OPEC+ members to cut production”.

The decreed output for June is even smaller: TOTAL is expected to produce 122,000BOPD in Egina.

This 40% reduction means that Egina, a brand new field, is bearing much of the burden of Nigeria’s share of OPEC+’s pledged cuts in output.

The production of TOTAL’s other operated deepwater field, the Akpo structure, has been kept intact, at around 100,000BCPD, because it is a condensate tank.

Production in some of the country’s other deepwater fields are considered so low they don’t even meet curtailment threshold.

Nigeria pledged to produce 1.579MMBOPD in June in the OPEC agreement. “This is in addition to condensate production of between 360-460 KBOPD of which are exempted from OPEC curtailment”, Timipre Sylva, the country’s Minister of State for Petroleum, said in early April 2020.

That’s about 200,000BOPD cut, of which Egina is “contributing” 40%..

 

 


Cameroon’s Power Utility Pushes its Gas Supplier into the Red

ENEO was once a key reason for Gaz du Cameroun (GDC) to dream big.

Seven years ago, the Cameroonian power utility promised an offtake of double the size of gas that the factories and other firms in Douala could readily demand from GDC, as the latter constructed pipelines and other infrastructure to incentivize consumption of gas in the country’s main commercial city.

But now ENEO (short for Energy of Cameroon), has fallen far behind in payment. The gross amount outstanding from the utility as at 31 December 2019 was $10.5Million, a significant debit in the balance sheet of a small player with production hardly exceeding six million standard cubic feet of gas per day 6MMscf/d.

The Logbagba gas field near Douala is GDC’s source of gas.

 As far back as 14 September 2019, Altaaqa, the generator supplier to ENEO, suspended operations at ENEO’s Logbaba site due to non-payment of invoices by ENEO.

GDC had continued to invoice ENEO based on take-or-pay provisions agreed to in the binding term sheet.

In April 2020, GDC announced that ENEO had arranged “payment of Four Invoices amounting to a net total of $2.9Million to GDC via “promissory notes” in the quarter”. That comes to no more than $4.2Million gross, but there is still a significant value of unpaid invoice to go.

ENEO’s default in paying a hydrocarbon producer is contrary to the new normal in Africa, where monopoly utilities and state hydrocarbon companies have general turned the corner in their attitude to paying debts owed to hydrocarbon producers in their countries.

Tanzania’s state hydrocarbon company TPDC and state power monopoly TANESCO pay gas producers more promptly. Egypt’s EGAS has improved terms of gas tariffs and annulled its debts significantly. Nigeria’s NNPC, though not exactly comparable as its case is joint venture agreements, has almost extinguished cash call arrears.

What makes the ENEO example particularly odd is that it is not an entirely state-owned company. It is majorly owned (51%) by Actis, the British investor and 44% owned by the Government of Cameroon. ENEO employees own a 5% stake. It is indeed an outlier of an example.


Eland’s Bosses Didn’t Make it to Seplat

Bayo Ayorinde, Chief Executive of Eland Oil and Gas at the time of the merger with Seplat, chose not to move into the new arrangement.

So did Pieter Van Der Groen, who was Eland’s Director of Business Development and former Chief Operating Officer.

Seplat purchased Aberdeen based company Eland Oil & Gas for $480Million, in a move which led to the delisting of the latter from the AIM segment of the London Stock Exchange.

In the new arrangement, Eland’s 30,000Barrels of Oil Per Day operations will remain outside Seplat; the company will be run as a subsidiary of Seplat.

Ayorinde joined Eland as Managing Director of Nigerian operations in 2015, after serving in Operations and Maintenance (O&M) services for Oriental Energy.

He has a degree in Chemical Engineering from the University of Ife and completed a General Management Programme at Harvard University. He started his career with Ashland and rose to the level of onshore Production Manager before leaving for Texaco Overseas where he served as Head of HR in Warri, the hub city in the Western Niger Delta. Afterwards, he worked for Moni Pulo and Allied Energy as Executive Director and COO before joining Afren in 2009. He was the Managing Director at Afren from 2011 before going to Oriental Energy.

Ayorinde currently freelances as a consultant for Seplat, as he prepares his next move.

Van Der Groen did not return calls.

Van Der Groen trained at the Universities of Auckland and Aberdeen, started his career with Schlumberger as a geologist in London, moving on to become a wireline engineer in South East Asia and West Africa. After his field work, he trained as a log analyst with Schlumberger in London for multiple clients. worked at Schlumberger Oilfield UK PLC. He moved to Amerada Hess initially as a Petrophysicist in the international team, then to technical and management roles. He then worked briefly with Gulfsands Petroleum in Syria as Deputy General Manager. In Nigeria he spent four years as General Manager of an independent oil company where he oversaw onshore development and production in the Niger Delta.

 

 

 


Payment Fees, Guidelines, for Nigeria’s 2020 Marginal Field Bid Round

Nigeria’s Minister of State for Petroleum has finally signed off on the launch of the country’s first bd round in 13 years, prompting the official release of the guidelines.

A total of fifty-seven fields, located on Land, Swamp and Shallow offshore terrains are on offer.

The bid is open only to Nigerian owned companies and a key criterion for prequalification is Federal Character Representation (evidence that a participatig company’s owners and key personnel are drawn from diverse parts of the country).

The Department of Petroleum Resources (DPR) will run the process.

Application form (for bidding) will be provided by the DPR and shall attract non-refundable chargeable fees as follows:

  • Application fee: 2 Million Naira per field.
  • Bid Processing Fee: 3Million Naira per field.
  • Data prying fee: $15,000.00 per field. Data prying shall be on appointment.
  • Data Leasing fee: $25,000.00 per field.
  • Competent Persons Report: $50,000.00 (Fifty Thousand US Dollars).
  • Fields Specific Report: $25,000.00.

Application fees and processing fees be paid into the Treasury Single Account (TSA). Signature Bonus will be paid into the Federation Account.

The fees for data leasing, data prying, Competent Persons Report (CPR) and Field Specific Report should be paid into the account of the National Data Repository (NDR) for repayment.

The applicant must show evidence of technical and managerial capability. The applicant shall demonstrate ability to fully meet the objective of undertaking expeditious and efficient development of a Marginal Field. Where there is little or no track record of petroleum operations, interested companies would be expected to demonstrate ability to manage or develop in that direction in the short to medium term.

Company shall confirm willingness to pay the offered Signature Bonus if successful.

The signature bonus will be determined by the economic viability of each field; which means that different

Such monies will be paid into the into the Federation Account. The bid round shall soon be announced,

The DPR will manage the process, ensuring compliance to the tenets of the guidelines.

Fuller details are in the DPR dedicated portal marginal.dpr.gov.ng

 

 

 


EOI For Geothermal Risk Mitigation Facility, Deadline JULY 15, 2020

The Geothermal Risk Mitigation Facility for East Africa (GRMF) launched its sixth Application Round on May 6, 2020. The deadline for the submission of the Expressions of Interest (EoI) is scheduled for 16:00 H Ethiopian Time on 15 July 2020.

The African Union Commission (AUC) via the Regional Geothermal Coordination Unit (RGCU) invites public or private organisation as well as public private partnerships to submit an Expression of Interest (EoI) to pre-qualify for financing support. More information on the Expression of Interest can be found on the GRMF-Homepage.  You will also find all necessary documents there. If you did not have the opportunity to participate in the Kick-Off Webinar for the sixth Application Round, a recording of the event is available here.

Please click here for the detailed announcement.

 


Low Price, Lockdown, Ideal for Oil data G&G Evaluation

The low oil price and restricted movement is the ideal time to expand the home office environment to allow for creative evaluation of all data in a company’s possession to resolve identified challenges in exploration Geoscience

This is the opinion of Ebi Omatsola. Africa’s top exploration thinker.

“That’s when its best to share knowledge with appropriate colleagues and prepare for the good days ahead when and if they come”, says the former Chief Geologist at Shell Nigeria and former MD of Conoil Producing.

“Petroleum is still the anchor for global energy”, Omatsola argues, and even if it’s very low priced at the moment, “Prices will still rise sufficiently to encourage low hanging Near Facility Exploration (NFEP)”, he explains.

Contending that natural gas is becoming the most important transition energy resource, Omatsola advises G&G (Geology and Geophysics) staff to pull out Prospect inventory and work them up, “as long as those prospects are in the NFEP category”.


Mojapelo Takes Hold of BP’s Largest African Downstream Operations

BP has appointed Taelo Mojapelo as Chief Executive Officer of its Southern African business unit (BPSA).
The supply chain expert succeeds Priscillah Mabelane, the accountant who, reputably, is the first woman in the history of South Africa’s oil industry to head up a multinational company.

Mojapelo’s last job was Director as Customer Service & Logistics at Mondelez, a position she took up in June 2017.

She had worked at DHL, South African Breweries, SAPICS and Kellogg’s.

The choice of a supply chain specialist as CEO is indicative of BP Southern Africa’s customer-centric focus.

BP SA has over 500 service stations in South Africa alone, comprising of over 200 branded convenience stores.

BPSA owns, with Shell, the largest crude oil refinery in South Africa (the 180,000BOPD SAPREF), which is located in Durban, the seaside holiday town on the edge of the Indian Ocean. It also manufactures lubricants at an oil blending plant located in the city of Durban. The company operates nine depots and three coastal installations, as well as the largest rail gantry in Africa located in Pretoria with planned upgrades to key depots.

 


America’s Move Against Adesina’s Re-election, Fits A Pattern

By the Editorial Board of Africa Oil+Gas Report

With its negative reaction to the conclusions in the report of the ethics committee of the African Development Bank (AfDB), the United States has made a clear symbolic move against the re-election of Akinwumi Adesina as the Bank’s Chief Executive.

Adesina is running for a re-election in which he is his own opponent. Many believe he has done a good job, especially in the energy sector, but being a lone candidate isn’t a surefire guarantee he will return.

The poll was moved by the administrators from May to August 2020.

Elections to the Presidency of the continent’s top development bank is often fraught.

It is instructive that it is in this election year that a group of “worried employees” came up with a list of grievances to the Office of Integrity and the Fight against Corruption (PIAC) as well as the Chairmen of the Ethics Committee and Audit Finance Committee, alleging that Mr. Adesina has violated the code of ethics, citing a number of questionable contracts and dubious appointments on Adesina’s watch.  The Ethics Committee investigated the allegations and declared that “the President is totally exonerated of all allegations”.

That clean bill should ordinarily provide the wind behind his sail.

But in a letter sent on May 22 to Kaba Nialé, the Ivorian Minister of Planning and Development and the president of the board of governors of the AfDB, Steven Mnuchin, the American secretary of the Treasury, says that the United States “urges the initiation of a full investigation into these allegations by using the services of an independent external investigator”.

To continue on the job, Adesina must win a double majority of African and non-African shareholders in a maximum of five rounds.

As of February 2020, Adesina had obtained the unanimous support of the Executive Council of the African Union, composed of 55 foreign ministers.

On the strength of his personal charisma, he was coasting to victory.

But there has to be other ways to stop him, the Trump administration, in its tendency for bringing down talented Africans at the helm of supranational institutions, thinks.

The whistleblowers who reported him to the ethics committee, had been suspected, all along, to have been instigated by the United States. As they were laying down the accusations, they were charging the ethics committee of an inability to be neutral.

And you could read, from Mr. Mnuchin’s letter, that these allegations are the US’ ammunition to stop Adesina from getting a re-election.

“Given the scope, gravity and detail of the allegations against the sole candidate for leadership of the bank for the next five years, we believe that further investigation is necessary to ensure that it has broad support, trust and a clear shareholder mandate,” Mnuchin writes.


Kenya To Restart Distributing Small LPG Cylinders to Poor Households

$28Million project had been stalled by a court case for two years.

After a two-year court case, in which it was accused of distributing substandard cylinders, the National Oil Corporation of Kenya (NOCK) will start the distribution of the six-kilogramme (6kg) Gas Yetu cylinders to poor households in the country.

East Africa’s largest economy wants to wean its poorest people from the use of dirty wood fuel. A total of 109,649 six-kilogramme cylinders, 329,422 burners and 329,260 grills have been lying in the corporation’s warehouses since the distribution was discontinued on court orders in 2018.

The government had allocated $28Million for purchase of the cylinders to be sold at a subsidised $19 rate with complete accessories under the Gas Yetu brand. It’s a steep discount from the market price of $47 for the 6kg gas cylinder with cooking accessories.

The operation was disrupted by the discovery that fraudulent contractors supplied 67,251 faulty gas cylinders. The discovery indicated that 40% of the cylinders supplied to NOCK were sub-standard, including having faulty valves that posed the danger of fire eruptions.

The court case, instituted by the Consumer Federation of Kenya (COFEK) was dropped after certain conditions were met including bringing on board the third party cylinder inspector. “The exercise by a third party cylinder inspector to independently test the cylinders and confirm the integrity and safety of the same ahead of distribution to Mwananchi starts on Monday, May 25, 2020,” Leparan Gideon Morintat told, NOCK’s chief executive officer told the Energy Committee of the Senate, the upper house of Kenya’s bicameral legislature.

 


BP’s Top Man in North Africa Retires

Hesham Mekawi has decided to retire. The Egyptian engineer, who is BP’s Regional President for North Africa, is leaving after a career with the European oil giant spanning over 30 years.

Mekawi will leave at the end of 2020 to pursue non-executive director opportunities. He will continue in his current role until 1 July 2020 and will then spend 6 months as a senior advisor to ensure the smooth transition of leadership.

Hesham joined BP in 1990 and, in the early stages of his career, held a variety of commercial, economic analysis and business development roles in Cairo, Houston, Chicago and London. He led the consolidation of BP Egypt, BP Algeria and BP Libya to create the expanded BP North Africa Region in 2014. Hesham transformed the North Africa business by identifying and progressing complex growth opportunities and actively managing the portfolio.

Over the past 5 years, BP has invested $14Billion in Egypt delivering at its peak 60% of Egypt’s annual gas production together with its partners. Hesham has been recognized many times over the years, both internally and externally. Of particular note is that he and his team were awarded BP’s Helios award for “BP at its best”, in 2011.

Bernard Looney, BP CEO, commented that “Over the years BP has counted on Hesham’s vision and leadership to maintain and grow our business in North Africa. Hesham has always shown outstanding performance and progressive leadership supported by longstanding relationships with key stakeholders and business partners. His deep commitment to the development of people has served as an example to us all. Hesham has been instrumental in delivering on our plans over many years – regardless of the circumstances. We will miss him.”

 

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