All posts tagged feature

FAR Is Unlikely to Go Far in Senegalese Field

Section: In the news · July 16, 2020 · No comments |

Australian minnow FAR has reported being notified that its Joint Venture voting and meeting rights on the Sangomar field development have been suspended.

Woodside Energy, the operator of the field is committed to going ahead to deliver first oil by mid-2023, but FAR, which holds 15% of the asset, has struggled to raise its share of the funding.

“The Operator is working with project contractors and the Government of the Republic of Senegal to optimise near-term spend whilst protecting the overall value of the investment and remain on schedule to deliver first oil in 2023”, FAR said in a release.

“Detailed engineering is progressing and long lead item purchase orders are continuing to be awarded for major equipment items in preparation for commencement of drilling operations in mid 2021”, the explorer disclosed.

FAR did not pay the June, and subsequent, cash call and accordingly has received notification from the Operator of the RSSD Joint Venture that FAR Senegal is in default.

“FAR has received notices of demand from one of the Joint Venture parties to compensate it for its share of the cash call it is funding on FAR’s behalf”.

Under the JOA default provisions, if a defaulting party has not fulfilled its financial obligations within 6 months from the date of notification of the default, it shall forfeit its participating interest without compensation. Unpaid amounts accrue interest at the LIBOR rate + 2%.

Key points of the Joint Operating Agreement (JOA) default provisions are:

6 month period to fulfill its financial obligations before forfeiting participating interest
non-defaulting parties must pay defaulting party’s unpaid amounts pro-rata to their participating interests over this period
defaulting party does not attend Operating Committee meetings or vote during default period

Tullow Shareholders Approve Its Sale of Uganda

Section: Farm in, Farm Out · July 15, 2020 · No comments |

Tullow Oil says that its request for the proposed sale of its entire interests in Blocks 1, 1A, 2 and 3A in Uganda- and the proposed East African Crude Oil Pipeline System- to TOTAL, was passed by the requisite majority of its shareholders at a General Meeting Wednesday, July 15, 2020.

“The resolution put to the General Meeting was voted on by way of a poll”, the company explains in a release.

Over 99% of the votes cast, or 788,781,164 votes, approved the deal, which was first announced to the market in April 2020.

The Transaction remains subject to a number of other conditions, including customary government approvals and the execution of a binding tax agreement with the Government of Uganda and the Uganda Revenue Authority that reflects the agreed tax principles previously announced.

Subject to the satisfaction of the conditions, the Transaction is expected to complete in the second half of 2020.

Tullow will receive $575Million, with an initial payment of $500Million for the sale. It will pick up the remaining $75Million cheque when the partners take the Final Investment Decision to launch the project. In addition, the Irish independent will receive conditional payments linked to production and oil price, which will be triggered when Brent prices are above $62/bbl.

Ghana’s Gas Master Plan is “Outdated”, Critic Claims, and “No Longer Fit for Purpose”

Section: Gas Monetization, In the news · July 14, 2020 · No comments |

Ghana’s four-year-old Gas Master Plan has been dragged into the national conversation around whether the country’s Gas Company should be subsumed into the flagship state hydrocarbon company, the Ghana National Petroleum Corporation (GNPC), as a subsidiary.
“The infrastructure plan is obsolete and needs revision”, submits Ernest Owusu Bempah, a public policy analyst, “and none of the supply and demand data in the plan are applicable.”
Mr. Bempah was responding to a presentation by the Africa Centre for Energy Policy (ACEP), a policy think tank that is highly revered in the West African country. ACEP had, in that presentation, revisited the lingering debate over whether the Ghana Gas Company should be, like in the Nigerian model, a subsidiary of GNPC or, like in the Egyptian model, be an entity by itself.
But it is the submission that Bempah makes about the Master Plan that the Africa Oil+Gas Report considers most crucial. Part of his summary:
• Gas Master Plans (GMPs) are meant to address two issues: Design Optimization and Operational Optimization.
• The current Gas Master Plan addresses only the former. Ghana Gas Team and their counterparts from Trinidad and Tobago have addressed the latter. Furthermore, a GMP is also a working document, which requires regular update. None of the supply and demand data in the GMP are applicable.
• The infrastructure plan is also obsolete, and needs revision. However, some of the recommendations and procedures are still worth considering. It will also require an expanded scope to include operational optimization
• Ghana Gas’ core business has three key components – Daily operations, which takes about 80% of the life-cycle time, periodic Maintenance which takes about 10% of the time and occasional expansion which takes the remaining 10% of the life cycle time.
• So, Ghana Gas’ key job description is to deliver gas for power generation for Ghanaians, through reliable and uninterrupted operations. Not necessarily expansion projects.
• Ghana’s Gas industry still riddled with legacy that; and Ghana Gas is owed the most by sister agencies. This is a very unusual circumstance by any standard. ACEP should be providing ideas to address this recurring legacy problem in the sector, instead of espousing short sighted band-aid solutions.
• It is important not to base lasting policy decisions, including Institutional Arrangements, just on ability to Finance new facilities or expansion of existing ones or someone’s Balance Sheet as suggested by ACEP.
• The 4 year-old GMP is hardly fit for purpose and requires an update and therefore cannot be used as bases for recommendation by ACEP.

The full article by Mr Bempah was published in The Ghanaweb and the June 2020 edition of Africa Oil+Gas Report.

South African Cement Producer to Build A Power Plant in Zimbabwe

Section: Power Deficit · July 13, 2020 · No comments |

Pretoria Portland Cement (PPC) is mobilizing finance to build and operate a 32 MW photovoltaic solar power plant in Colleen Bawn, in Zimbabwe’s Matabeleland South Province.

The Johannesburg based company has picked a Solar Power supplier for the project, the construction of which is expected to last around 18 months.

Half of the electricity produced will be used to power PPC’s facilities and the other half will be fed into Zimbabwe’s national electricity grid.

Zimbabwe is chronically short of electricity, with the country’s power utility supplying only around 1,000MW, to a population of 15 million people.

But Solar Energy solutions have become hugely popular in the southern African country in the last two years, such that more than 100 000 solar power systems are installed in homes across Zimbabwe, according to figures from the Ministry of Energy.

And companies are now turning to off grid independent solar energy. Last April, the Caledonia Mining Corporation, which operates the Blanket gold mine, also in Matabeleland South Province, issued a call for tenders for a 19.65 MW solar project.

Oil Companies Increasingly Use Renewables to Power Field Operations

Section: ENERGY TRANSITION · July 13, 2020 · No comments |

Striking pace of growth” in renewable projects powering oil and gas field operations

Oil and gas field operations are beginning to be fueled by a surprising source—renewable energy, according to new research by IHS Markit.

Oil and gas companies are starting to utilize such zero-carbon sources to reduce carbon emissions associated with operations, according to a new database and analysis by IHS Markit of these types of renewable energy projects.

“There is a striking pace of growth over the past few years and a dynamic commercial environment for delivering renewable energy to oil and gas operations,” said Judson Jacobs, executive director, upstream energy, IHS Markit. “Energy efficiency efforts and reductions in flaring can only do so much to lower greenhouse gas emissions, so some companies are turning to zero-carbon sources to power their upstream, midstream and downstream operations.”

While the numbers are small, they have been growing rapidly over just the past couple years. There had been fewer than 15 of these renewable energy projects from the early 2000s (when the industry first deployed such technologies) through 2017. IHS Markit now tallies more than 45 announced projects in its Oil and Gas Field-based Renewable Energy database, with 13 announcements made in 2018 and 15 made in 2019.

Projects announced in 2018 and 2019 are expected to avert more than 3 million metric tons of annual carbon dioxide (CO2) emissions combined. By contrast, projects in only one prior year averted as much as 0.3 MMT. Deployments are occurring in both new developments and existing assets, with solar the most prominent renewable technology, followed by hydropower and wind. These deployments are part of companies’ broader greenhouse gas emissions management strategies that IHS Markit tracks and analyzes.

Several factors beyond emissions reduction are also driving the growing interest for renewables in oil and gas operations, Jacobs said.

“Stakeholder pressure to reduce emissions is a factor,” Jacobs said. “It is also about steeply declining costs for renewables and the industry’s growing familiarity and experience with these technologies. And there are tangible improvements to operational performance that go along with using them.”

Field-based renewable installations are demonstrating reliability. And electrification—drawing renewable-generated power direct from the grid, as to offshore platforms in Norway—removes most energy generation equipment entirely, enabling fewer on-site personnel needed to operate it and smaller facility footprints. Additional benefits include reduced maintenance expenses and the elimination of fuel deliveries to site.

While IHS Markit expects the number of field-based renewable energy projects will continue to accelerate in the coming years, several challenges must be overcome before widespread adoption. Cost relative to traditional energy generation sources, the development of supply chains in remote regions, and energy storage for intermittent renewable sources are all significant factors currently constraining growth.

Nigerian Indies Pump up the Volume, Smack in the middle of COVID-19 Season

Section: In the news · July 13, 2020 · No comments |

There was no slow-down in crude oil production on the facilities controlled by over 20 Nigerian independents in April 2020, even as fall in demand remained the status quo and crude oil cargoes were chasing buyers.

Seplat produced over 60,000Barrels of Oil Per day (operated) on the last two days of that month, in its Wester Niger Delta assets a figure it hadn’t reached for several months before then.

NPDC’s JV with Shoreline Natural Resources and Neconde, the two other high volume, indigenous producers in the Western Niger Delta, averaged gross output of about 40,000BOPD each. NPDC/Elcrest and NPDC/First Hydrocarbon grossed 26,000BOPD and 11,000BOPD respectively in the month. (Figures are field data, which, except for NPDC/Neconde’s, will still be moderated by pipeline losses).

“We had to keep producing”, says a Chief Executive Officer of one of the companies, “even as the commodity was selling $9 or less per barrel”.

For the NPDC/ Shoreline JV, which normally averages over 60,000BPD, the lower figure was due outages caused by “forceful shutdown by host community interference in Olomoro, Oweh, Uzere and Oroni flowstations”, the field notes show.

Some of the companies had hedged against fluctuations in oil, but these times are unusual: prices had crashed down to earth.

Even so, “Crude oil produced today may not be sold until June, when prices may have moved up”, another CEO says, in justifying why production was continuing in a frenzy.

Published in the May 2020 edition of Africa Oil+Gas Report.

Full details of average daily production (field data only) by Nigerian indigenous companies are published in monthly issues of Africa Oil+Gas Report.

Anchor Handling Tug Supply is Most Widely Used Vessel in Nigerian Offshore Oil Industry

Section: MARITIME ISSUES, MARITIME SERVICES · July 13, 2020 · 3 comments |

By Favour Omokhaiye and Gloria Odunuyi

The Anchor-Handling Tug supply (AHTS) vessels constitute the largest segment of the offshore support vessel market, by type, in use by oil companies operating in Nigerian waters in the months of April and May 2020.

Nine indigenous and international oil companies working offshore utilised 150 vessels, of twenty types for various operations in the months under review.

Chevron used the largest number and the most diverse of vessel types, followed by ExxonMobil and Shell.

AHTS vessels are designed to provide anchor-handling and towage services and are also used for supplying deck cargo, water, fuel, dry bulk, and mud-to-oil rigs and platforms.

These vessels can also be used for emergencies and are well equipped for firefighting, rescue, and oil recovery operations.

But while they have high utility value, AHTS are not necessarily the most sophisticated. The Multifunctional Support Vessel, for example, has the capacity for deploying robots and divers into deep offshore, to perform field optimisation tasks in deepwater reservoirs.

Other Offshore Vessels (OSSVs) in use during the period were platform supply vessels (PSV), anchor handling tugs, utility workboat vessels, research vessels, emergency response and rescue vessels (ERRV), accommodation barges, cable/umbilicals flowline lay vessels and crew boats.

Also referred as vessels are Floating Production Storage and Offloading (FPSO), Jack up drilling rigs and Self elevating Install Barge, The nine companies which utilised the 150 vessels during the months are: Addax, Amni International, Chevron, Dangote, ExxonMobil, First E&P, NPDC, Shell and TOTAL.

Omokhaiye and Odu are covering the maritime issues and the gas market for Africa Oil+Gas Report.

Tribute: Prime Minister Amadou Gon Coulibaly

Section: Petroleum People · July 10, 2020 · No comments |

By Akinwumi A. Adesina

July 8 was all like every normal day, focused on work. I had no inkling there would be a storm, even though we have weathered many storms and floods in Abidjan in recent times. Like a jolting bolt of thunder, everything changed when my wife, Grace, called my attention to a news item that the Prime Minister Amadou Gon Coulibaly had died. I told her this couldn’t be true as he just came back and as far as I knew he was fine.

I quickly went to look at the news. I had not seen any official confirmation. I made frantic calls. Alas! Amadou Gon had died indeed. What a tragedy! This was a storm with massive lightening like no other. I couldn’t control my sadness. This man who had served his nation so loyally and with such dignity has passed on, while at work.

My thoughts went to his dear wife and family who have been thrown into sorrow, suddenly. My mind went to President Alassane Ouattara, to whom he was a beloved son, a loyal partner and confidant for some 30 years. My mind went to the government of Côte d’Ivoire, and the nation where I lived for 5 years in the 1990s and now for another 5 years so far as President of the African Development Bank. A beautiful nation whom Amadou Gon served dutifully, diligently, passionately and faithfully until his last breath.

Amadou Gon was an exemplary leader. He was my friend. I remember calling him while in Paris. I was concerned about him and although we had exchanged messages, I still was not satisfied. I wanted to hear his voice. We spoke. I was very happy he was well.

Amadou Gon deserved to be well. He was such a great champion of programs to accelerate the development of his country. He carried the vision of the President and the government wholeheartedly into every meeting, into every discussion. We met very often, and every time I was always amazed at how this very humble and serious minded public servant always put the development of his country first.

He worked very closely with the African Development Bank. He visited the Bank several times and took great interest in all matters that affect the Bank. He worked so hard with the Bank and several development partners to bring life to the social development policy of the government.

A humble man. A selfless man. A faithful man. A shining light. We met and spoke together on several forums around the world: on the plane, at airports, in high level forums and summits. My impression of him was the same: calm; wise; insightful. A man of few words, whose every word was always well honed for impact. He spoke always from his heart. An he had a heart of gold.

My heartfelt condolences go to his dear wife and family, and his aged mother. May God comfort them. My heartfelt condolences go to President Allassane Ouattara, President of the Republic of Côte d’Ivoire. Mr. Président, you have lost your closest ally and confidant, who served you and his nation faithfully until his last breath, working for the good of Côte d’Ivoire. May God comfort you, the government and good people of Côte d’Ivoire.

My dear brother, Amadou Gon, thank you for your friendship. I was looking forward to us meeting again, in our usual warm brotherly embrace, to chat on your favorite topic: development of Côte d’Ivoire. But Alas! That is no longer to be. I guard emotions and memories of your life – your great life; and dedication and contributions to your nation. Thank you Prime Minister Amadou Gon Coulibaly. Thank you my dear friend and brother, Amadou Gon. Rest well. You will be sorely missed.

Adesina is Président, African Development Bank

Siemens’ Spin-Off of Energy Unit Gets Unanimous Approval

Section: In the news · July 10, 2020 · No comments |

By Mackson Orija

A large majority of Siemens shareholders voted Friday July 10, 2020, to approve the spin-off of the company’s energy business to Siemens Energy AG.

“This step paves the way for the establishment of an independent company rigorously focused on the energy sector”, the German conglomerate said in a release.

“In the future, Siemens AG will concentrate on Digital Industries, Smart Infrastructure and Siemens Mobility”, the company explained.

In total, 61.94 % of the capital stock of Siemens AG entitled to vote was represented at the shareholders’ meeting, which was held as a virtual event due to the coronavirus crisis.

Approval of the Spin-off and Transfer Agreement between Siemens AG and Siemens Energy AG was the only item on the meeting agenda.

The agreement was approved by a majority of 99.36 percent of the capital stock represented. The highest number of participants following the Extraordinary Shareholders’ Meeting online was 3,870 at the July 10, 2020 Extraordinary Shareholders’ Meeting.

400Million Barrels of Oil Extracted from Ghana Since 2010

Section: In the news · July 9, 2020 · No comments |

By Toyin Akinosho

Ghana has produced ~392Million Barrels of Oil since extensive commercial production started in November 2010.

The flagship asset, Jubilee field, delivered 284,016, 968Barrels, from November 28 2010 to January 31, 2020.

The TEN cluster of fields, which is operated by Tullow Oil, the same company that operates Jubilee, has produced 73,266, 506 Barrels between August 18, 2016 and January 31, 2020.

The ENI operated Sankofa Gye Nyamme (SGN) twin fields delivered 34, 790, 660Barrels between May 1, 2017 and January 31 2020.

Average production for each of the three fields in January 2020 were: 63,839Barrels of Oil Per Day (BOPD) for Jubilee; 52,300BOPD for TEN and 55,279BOPD for Sankofa.

SGN is the country’s top gas producer, delivering in excess of 60Million standard cubic feet per day.