10 Developments that will Shape Africa’s Energy Sector · 2019. 1. 2. · rival presidential...

Petroleum Africa January/February 2019 3

Monthly FocusRegional Cooperation 28

Local ImpactPartnership Approach Proves Crucial in Remote Healthcare 30

DEPARTMENTSMoving OnAfrican PoliticsMessage from the EditorAfrica’s Big FiveAfrica at LargeDownstream News

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ON THE COVER

ContentsVol. 16 Issue 1January/February 2019

Market MoversAround the WorldPower & AlternativesFacts and FiguresConferencesAdvertisers’ Index

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Technology and SolutionsGeochemistry Moves to the Wellsite 22

Oil Security10 Developments that will Shape Africa’s Energy Sector 19

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A mud logging-geochemical unit operatingin the USA for unconventionals

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New Products & ServicesNew Tool Provides Metal Loss and Geometry Data

Forum’s New eROV Offers Big Savings for Operators

Pepperl+Fuchs Introduces the Next-Generation Purge

Tracerco Launches Hyperion for Bulk Level

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Downstream FocusDownstream Investment Driven by Innovation & Efficiency 32

African FocusOverview: Egypt

Overview: Tanzania

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OpinionAngola: The Grace Period is Over for João Lourenço 34

Partnership in remote medical services paysdividends in Kenya

Petroleum Africa January/February 20194

AFRICAN POLITICS

Egypt Takes Over AU ChairmanshipRwandan President Paul Kagame’s term asAfrican Union chair, came to an end. Taking overthe duties of the AU is Egyptian President AbdelFattah el-Sisi. Chairmanship is rotated betweenthe five regions of the continent.

A m n e s t y I n t e r n a t i o n a lexpressed some concern withel-Sisi taking over. “During histime in power President AbdelFattah el-Sisi has demonstrateda shocking contempt for humanrights. Under his leadership thecountry has undergone acatastrophic decline in rightsand freedoms,” said NajiaBounaim, Amnesty’s NorthAfrica Campaigns Director.

“There are real fears aboutthe potential impact his

chairmanship could have on the independence ofregional human rights mechanisms and theirfuture engagement with civil society.”

Since 2015, Egypt has orchestrated a vicious andsustained political attack against its people andopponents, says the African Commission onHuman and Peoples’ Rights (ACHPR), themechanism that aims to monitor African states’human rights records. Dozens of cases allegingserious human rights violations have been lodgedagainst Egypt at the ACHPR.

The Egyptian authorities have carried out masskillings of protestors, widespread enforceddisappearances, and sentenced hundreds to deathfollowing unfair trials. The authorities have alsoorchestrated the worst crackdown on freedom ofexpression in the country’s recent history.

The Egyptian parliament is considering a numberof proposed constitutional amendments that wouldexpand the scope of military trials, underminejudicial independence and allow el-Sisi topotentially stay on as a president until 2034.

“The African Union member states must ensurethat Egypt, as political head of the organizationfor 2019, upholds the African Union’s values andprinciples, including respect for human andpeoples’ rights,” said Najia Bounaim.

Amnesty International also called on Egypt toratify key African Union human rights treatiesincluding the Maputo Protocol on the Rights ofWomen in Africa, the Protocol on theEstablishment of the African Court on Humanand Peoples’ Rights, and the African Charter onDemocracy, Elections and Governance.

Disputed DRC ElectionsStoke Fears of ViolenceAlthough fraught with challenges of widespreadelection fraud, the elections that took place in theDemocratic Republic of Congo (DRC) onDecember 30 will realize the first democratictransfer of power in the country’s history.

After a significant delay, the DR Congo electioncommission (known as CENI) on January 10issued a provisional result, declaring oppositionleader Felix Tshisekedi the winner of the vote.According to news reports, the preliminary resultsannounced by CENI, did not tally with theunofficial figures gathered by independent pollobservers. According to CENI, Mr. Tshisekeditook more than 38% of the votes cast, ahead ofrival presidential hopefuls Martin Fayalu(34.8%)and ruling party candidate, EmmanuelRamazani Shadary. Mr. Fayalu immediatelyrejected the result.

Following the announcement of the provisionalresults of the long-delayed presidential election,United Nations Secretary-General AntónioGuterres appealed for all parties to “refrain fromviolence” in the DRC.

“The Secretary-General calls on all stakeholdersto refrain from violence and to channel anyeventual electoral disputes through theestablished institutional mechanisms in line withthe DRC’s Constitution and relevant electorallaws,” said Mr. Guterres in a statement releasedby his Spokesperson.

Meanwhile, members of the UN Security Councilcongratulated the millions of Congolesepeople who went to the polls with calm anddetermination to express their choices andcommended the Congolese people and politicalactors for the conduct of the presidential,national and provincial elections, which sawbroad and inclusive participation of politicalparties. They further welcomed the importantrole played by national as well as the regionalobservation missions of SADC and the AfricanUnion and took note of their efforts in promotingtransparent and fair elections among theirmembers.

Al-Shabaab Hits Kenya TwiceTwo attacks by Somali terrorist group al-Shabaabhave the East African country on high alert. Analmost 20-hour siege of the DusitD2 hotel andoffice complex on January 15 by a suicide bomberand four gunmen left 21 dead and many otherswounded.

Less than a week later, on January 21, Kenyanpolice thwarted an attack by suspected al-Shabaab

militants on a Chinese-owned constructioncompany.

The assailants wounded one person while theyattempted to hit the site in Garissa county, notfar from the Kenyan-Somali border, owned by aChinese road construction company that isbuilding the Garissa-Modogashe highway.

Preferential Tariffsto Aid Western Sahara’s DevelopmentOn January 16, the European Parliament backeda proposal to lower tariffs in the territory ofWestern Sahara to the same level as Moroccantariffs, to benefit local populations. The Parliamentgave the green light by 444 votes to 167 and68 abstentions, to extend the preferential tariffrates to the territory of Western Sahara after theEuropean Commission and Morocco agreed ona traceability mechanism, which helps define theorigin of products exported from the territory.This mechanism was requested by the Committeeon International Trade prior to its recommendationfor consent.

It guarantees that products coming from theWestern Sahara can be clearly tracked, to makesure the benefits of the lower tariffs go to thelocal population and that they are measurable, akey condition to MEPs’ backing.

In the accompanying resolution, adopted by442 votes to 172 with 65 abstentions, the MEPsemphasized that “the [local] Sahrawi people havethe right to develop while awaiting a politicalsolution” on the status of the area of WesternSahara. Preferential trade tariffs granted toMorocco were withdrawn from the territoryfollowing a 2016 decision of the EU Court ofJustice.

MEPs also pointed out that the tariff preferencesenjoyed by the territory between 2013 and 2016had a positive impact on the agricultural andfisheries sector, investment in infrastructure,health and education. The non-application of thepreferences, on the other hand, would have had“adverse effects”, they say.

After the Parliament’s consent, the Council willconclude the agreement, which will then enterinto force.

Abdel Fattah el-Sisi

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CONTACT US

MESSAGEF R O M T H E E D I T O R

Petroleum Africa Magazine is aTexas, United States-registered company.PO Box 1571 Montgomery, TX 77356

Happy New Year! I hope you are all off to a good start in 2019!

For those of you not yet aware, Petroleum Africa has instituted a number ofchanges for 2019. We will now publish the magazine six time per year. Notto worry however, we will still deliver the most relevant and up-to-datecontent in each of our six issues. In addition, there will now be more full-length editorial features available on www.petroleumafrica.com. Finally, forour advertisers, there are a number of new marketing options to choose from.Feel free to email us to request a copy of the 2019 Media Planner formore information.

Over the past two decades, those interested in the African oil and gas patchhave opined over the competition between American, European, and Chinesefirms for access to lucrative energy contracts in the continent. These discussionsoften touched on the rigid transparency issues demanded by the Westernfirms and the more or less “no strings attached”offerings by the Chinese.While this discussion still exists to a lesser extent, it looks like in the decadegoing forward there will be a new talking point _ Middle East entrants andtheir often flexible and generous investment terms.

Kuwait Energy, Mubadala Petroleum, RakGas, and Qatar Petroleum are justa handful of Middle Eastern oil firms that have started building an E&Pportfolio in the contintent, and others still are involved in the downstreamand power sectors. Most recently, Saudi Arabia and South Africa announceda mega deal with the Saudi kingdom looking to build an oil refinery and apetrochemical plant in the African country. The possibility of Saudi Aramcousing South African oil tanks in Saldanha to store its crude oil also exists.

Now that seven of the 14 OPEC members are African nations, it seems likelythat increased cooperation will be seen, perhaps resulting in even greaterinvestments into Africa by the Middle Eastern members. This new trend isnot limited to OPEC members however, other non-OPEC Middle Easterncompanies (and governments) are seeing the synergies and benefits ofpartnering with, and investing in, the African continent’s energy sector.

Egypt and Tanzania share the spotlight in this issue’s Africa Focus section.With both countries working to develop and monetize their considerablenatural gas resources, key project updates are provided. Be sure not to missthe Technology & Solutions feature where GeoLog International takes a lookat combining mud logging with reservoir geochemistry for better reservoircharacterization in real time. Local Impact features the partnershipbetween Remote Operations International and Tullow Oil to ensure that thehealthcare needs of its workforce are met at its Kenyan operations. Asalways, your comments and suggestions are welcome and can be sent [email protected].

Dianne SutherlandChief Editor

Advertising RepresentativesAustria, Germany, SwitzerlandEisenacher MedienErhardt EisenacherTel: +49 0228 2499 [email protected]

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South AfricaAntonette BentingTel: +27 82 414 [email protected]

North AmericaFarrah YounesTel/Fax: +1 713 867 [email protected]

Rest of Africa/Middle EastFarrah YounesTel: +254 20 243 [email protected]

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Global InquiriesJina SellersTel: +1 713 867 [email protected]

Deputy EditorJennifer [email protected]

Senior CorrespondentMark Pabst

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Client Relations andDigital Media ManagerFrederick Caccamo Jr.

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Africa Headquarters10G Ahmed Abd El-Aziz St.,New Maadi, Cairo, EgyptTel/Fax: +2 02 2517 [email protected]

[email protected] visit www.petroleumafrica.com


MOVING ON

MX Oil retained the services of Wim Burgersas a consultant. Burgers has more than fourdecades of international exploration andproduction experience as a geologist andgeophysicist.

Aqualis Offshore has appointed Simon Healyas general manager to head up its Australianoperations. Healy is a highly experiencedmaster mariner who has held senior positionswith Swire Pacific Offshore and ran offices inSingapore, Middle East (Doha), West Africa(Douala) and Australia.

Chevron named Pierre Breber VP and CFO,effective April 1, 2019. Breber replaces PatriciaYarrington who has elected to retire after 38years of service with the company. In relatedmoves, Mark Nelson, currently VP Midstream,Strategy & Planning, will succeed Breber asexecutive VP of Downstream and Chemicals.Colin Parfitt, currently president of Supply &Trading, will become VP of Midstream. Bothappointments are effective March 1, 2019.

Ryan Lumsden has been appointed businessdevelopment manager of Saab Seaeye. He haswide experience in the underwater vehiclemarket and will join the company’s sales andmarketing team.

ExxonMobil launched a reorganization,streamlining its upstream organization and madea few appointments to run the new companies.Liam Mallon, currently president of ExxonMobilDevelopment Co., will become president of

ExxonMobil Upstream Oil & Gas Co. SteveGreenlee, currently president of ExxonMobilExploration Co., will become president ofExxonMobil Upstream Business DevelopmentCo. Linda DuCharme, currently president ofExxonMobil Global Services Co, will becomepresident of ExxonMobil Upstream IntegratedSolutions Co. Neil Duffin, currently president ofExxonMobil Production Co., will becomepresident of ExxonMobil Global Projects Co.

King & Spalding has recruited project financespecialist Robin Bayley as a partner in the firm’sCorporate, Finance & Investments practice basedin Abu Dhabi. Bayley represents sponsors,developers and financial institutions on complex,multi-sourced financings of large energy andinfrastructure projects throughout the Middle Eastand Africa.

Wintershall made some changes in leadershipin the Middle East, appointing Helge Beuthan,current ly VP for Global SubsurfaceEvaluation, to take over the duties of Dr. UweSalge in Abu Dhabi. Beuthan took over onFebruary 1. Salge will return to Wintershall inKassel, where he will take over Beuthan’s areaof responsibility.

Lee Tillman has been appointed Marathon OilCorp.’s chairman effective February 1. Tillmanwill continue to serve as president and CEO, aposition he has held since 2013. He succeedsDennis Reilley, who has elected to retire afternearly six years as chairman and more than 17years on the Marathon Oil board of directors.The company also announced that the board hasappointed Gregory Boyce as its lead independentdirector, effective February 1. Boyce has been adirector of the company since 2008.

Brendan Warn was appointed senior VP, InvestorRelations of Total, effective January 1, 2019. Hesucceeds Mike Sangster. Prior to joining Total,Warn was managing director and UK Head ofEquity Research at BMO Capital Markets inLondon.

ICR Integrity (ICR) appointed a new COO andCFO to support the business with its internationalgrowth strategy. Richard Wilson joins ICR in

the newly-created role as COO, utilizing threedecades of operational and commercial experiencein the oil and gas industry. The new CFO,Alan McQuade, joins ICR after previouslyserving as CFO at two Acteon Group operatingcompanies.

Xodus Group strengthened its social performancecapabilities with the appointment of Karen Nashas its social impact specialist. Throughout hercareer Nash has worked across the world,including Africa, Latin America, Southeast Asiaand Central Europe.

Halliburton’s board of directors has appointedJeff Miller, the company’s president and CEO,as chairman of the board. The appointmentwas effective January 1, 2019. Consistent withthe company’s corporate governanceguidelines, Executive Chairman Dave Lesarretired on December 31, 2018. Robert A. Malonewill continue as lead independent director ofthe Halliburton board of directors.

World Bank Group President Jim Yong Kimstepped down from his position on February 1.Kristalina Georgieva, the World Bank’s CEO,assumed the role of interim president until a newpresident is appointed.

Neil Levett is joining the JLA Media teamas lead consultant for its newly-establishedOil & Gas division, taking responsibilityfor a fast-growing part of the organization’sPR and communications activities.

To include a corporate personnel announcement in Moving On, write to [email protected]. Preference will be given to Africa-specific appointments and to thosecompanies who have interests within the continent; all others will be included on a space available basis.

Royal Dutch Shell plansto appoint Neil Carson asa director of the companyat its 2019 Annual GeneralMeeting. The appointmentwill be effective June 1.T h e c o m p a n y a l s oappointed Wael Sawanas upstream director,effective July 1.

Wael Sawan

L i n c o l n E l e c t r i cHoldings, Inc. appointedGeoffrey P. Allman toserve as senior VP,Strategy & BusinessDevelopment, effectiveimmediately. Allmanbegan his career at LincolnElectric in 1997 and has

held various positions of increasingresponsibility in Internal Audit, Accounting,and Finance.

Geoffrey P. Allman

ProSep named RaulGonzalo as i ts newregional sales and servicemanager in the MiddleE a s t . P r o S e p a l s oa n n o u n c e d t h a tRyan McPherson ismoving to EIC as MiddleEast director.Raul Gonzalo

Element Mater ia l sTechnology (Element)a p p o i n t e d M a t tHopkinson as its newexecutive VP for the Oil &Gas and Infrastructuresector. Hopkins joinsElement from BureauVeritas where he most

recently served as VP. Commodities. Heassumed his position on January 1 and replacesDr. Rod Martin who has taken on the roleof VP, Technology for the Oil & Gas andInfrastructure sector.

Matt Hopkinson

dmg events appointedMel Shah as vice presidentof its Energy Sector, Asia.Shah wil l grow thecompany’s energy eventsin Asia. Shah’s twodecades of experience spanthe energy, d ig i ta l ,manufacturing, food and

hospitality sectors in Asia.

Mel Shah


AFRICA’S BIG F IVE

SDX Receives DevelopmentApproval for South DisouqSDX Energy saw its development leaseapplication for the South Disouq concession inEgypt approved by authorities. Construction ofa pipeline and central facility have already started.First production from the license remains on trackto start towards the end of H1 2019, with SDXexpecting to achieve a gross plateau productionrate of conventional natural gas of between50-60 MMscf/d.

The 170 sq km 3D seismic acquisition programat South Disouq is 50% complete and is expectedto conclude in February. The seismic data willthen be processed and interpreted by the end ofQ3 2019, with drilling on the license set to resumeshortly thereafter.

Egina Comes OnstreamProduction has started from Nigeria’s latestdevelopment. Total, the operator of thedevelopment, brought the Egina field on toproduction at the end of 2018. At plateau theEgina is expected to produce 200,000 bpd.

The FPSO used to develop the giant Egina fieldis the largest one Total has ever built. This projectinvolved a record level of local contractors. Sixof the 18 modules on the FPSO were built andintegrated locally, and 77% of hours spent on theproject were worked locally.

Startup has been achieved close to 10% belowthe initial budget, which represents more than $1billion in capex savings, due in particular toexcellent drilling performance where the drillingtime per well has been reduced by 30%.

The Egina field is the second development inproduction on OML 130 following the Akpo field,which started-up in 2009. The Preowei field isanother large discovery made on this prolificblock for which an investment decision isscheduled to be taken this year.

NOC and Sonatrach Talk BudgetsNational Oil Corporation (NOC) and Sonatrach,the state-run firms of Libya and Algeria,respectively, met to discuss joint activitiesand balance sheets for 2018 for Blocks 65 and95/96 in the Ghadames Basin. The budget for2019 covering the two blocks was also part ofthe discussion.

The parties also discussed a report evaluating thereservoir capacity for Block 95/96, and the releaseof drilling rig TP215, following completion ofthe drilling of well 02-96 1A.

Further, the committee discussed the evaluationand development of Block 65 through itsassociation with Arabian Gulf Oil Company’s(AGOCO) Hamada fields.

Ororo-2 Spud Date Still FlexibleSirius Petroleum should be able to launch itsplanned drilling program in Nigeria in the nearfuture. The company was recently advised byShelf Drilling that the Adriatic-1 jack-up rig iscurrently completing the last of its pre-existingcontracts with another operator.

The rig is at this time stationed on a block adjacentto Sirius’ Ororo field on OML 95. The timing forthe spudding of the Ororo-2 well is dependenton the final completion of the previous contract.Sirius said it will not have a definitive time forthe spud until Shelf Drilling notifies it of themobilization of the rig to the Ororo-2 location.

Libya Aims to Double ProductionDespite security issues disrupting productionoccasionally, Libya is still set on its productiongoals. The government aims to more than doubleits oil flows over the next two years.

Mustafa Sanalla, chairman of NOC, said that thecountry is looking to hit 2.1 million bpd by 2021,provided security and stability are strengthenedin the North African country. Currently Libyaproduces 953,000 bpd, Sanalla said at a newsconference in Benghazi.

At the press conference Sanalla reiterated callsfor workers’ security to be improved toallow production to resume at the Sharara oilfield, which was taken over on December 8by tribesmen, armed protesters and stateguards demanding salary payments anddevelopment funds.

Sanalla also confirmed the upcoming return ofBP to Libya along with Russian companies,without giving further details. Improved security

conditions in the Sirte Basin in central Libya willalso enable the launch of production at the Farighgas field at 24 Mmcf/d output goal of 270 Mmcf/d,Sanalla added.

Production Addedfrom Angola’s Block 15/06Angola saw new production added to its totalswhen ENI launched a new production well on itsVandumbu field. The well is located offshore thesouthern African country on the West Hub ofBlock 15/06.

The start-up of the VAN-102 well, which followsthe start-up of ENI’s second subsea multiphaseboosting system (SMBS), took place through theN’Goma FPSO. The well, on start-up, achievedan initial rate of 13,000 bpd.

The VAN-102 is a further step in the developmentof the Vandumbu field, launched on November29, three months ahead of schedule, and whichwill be completed in Q1 2019 with the start-upof the water injection well. This, together withthe start-up of another production well in theMpungi field, will bring the production of Block15/06 to a total of about 170,000 boepd, furtherextending the production plateau.

SPDC Takes FID on Assa NorthNigeria’s Assa North Gas Development Projectsaw Shell take the final investment decision (FID)on the project recently. The FID adds togovernment enthusiasm toward its domestic gasaspirations for increased power generationand industrialization.

The Assa North is expected to produce around300 Mmcf/d at its peak production levels. Thegas produced will be treated at ShellPetroleum Development Company’s (SPDC)Gas Processing Facility and distributedt h r o u g h t h e O b i a f u - O b r i k o m - O b e npipeline network.

The Managing Director of SPDC and CountryChair, Shell Companies in Nigeria, OsagieOkunbor, disclosed that the project would be amajor game-changer in Nigeria’s quest for energysufficiency and economic growth.

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Recently the Shell subsidiary signed a gas supplyand aggregation agreement with Geometric PowerAba Limited (GPAL) for the supply of about 43Mmcf/d to support the 140 MW Aba IntegratedPower Plant at Ossisioma in Abia State.

By the agreement, SPDC will supply gas fromthe SPDC JV gas plant to the power producer,GPAL, via a gas pipeline network which isalready installed.

Waha Adds Faregh Field to Libyan TotalsWaha Oil Company, a NOC subsidiary, completedpreparations on another horizontal well in theFaregh field ahead of the planned start of second-phase experimental gas production. Waha isexpected to start the second-phase of experimentalgas production at the end of Q1 but was able tomove the date forward by almost two months.

According to NOC, the initial tests indicate thatthe B B-14-59 well is expected to produce up to24 Mmcf/d of gas, and 1,500 bpd of condensate.This well is in addition to the expected 33 Mmcf/dof gas, and 1,400 bpd of condensate productioncapacity of well B B-10-59, completed inNovember 2018.

NOC chairman, Mustafa Sanalla thanked staffdedicated to this project and underlined theimportance of a refocused Faregh field to providegas for local community use, and the fosteringof further regional economic development.

ENI to Complete 14th Zohr WellENI expected to complete the drilling of itsfourteent well on Egypt’s Zohr natural gas fieldby late January, early February. This well willincrease the number of producing wells on thefield to 10. The well is expected to immediatelybe put onto production once complete.

The company will start evaluating the field’sproduction to estimate the number of wells to bedrilled in the second phase of Zohr field’s project.ENI is looking to boost production rates to2.7 Bcf/d of natural gas by the end of the yearwith further gains in the future planned.

Eland Completes Gbetiokun-3Appraisal & Development WellThrough its joint-venture subsidiary, ElcrestExploration and Production Nigeria, ElandOil & Gas has completed drilling phase ofthe Gbetiokun-3 appraisal and development wellin Nigeria.

The OES Teamwork Rig has successfullycompleted drilling the Gbetiokun-3 well as partof the initial phase of the field development. Thewell encountered oil-bearing reservoirs acrossmultiple horizons and will be completed as a dualproducer on the D9000 and E4000 reservoirs,which have total net pay thicknesses ofapproximately 46 feet and 44 feet true verticaldepth respectively. The secondary targetreservoir, E7000, was encountered slightlydeeper than expected and consequently thedecision has been taken to complete this well onthe E4000 reservoir.

The E7000 is currently being reassessed with aview to being targeted by future wells.Downhole samples collected from theD5000 established that the shallow reservoir oilis mobile and pressure volume temperatureanalysis will be performed on the sample toconfirm the D5000 can be developedcommercially.

Production testing of the Gbetiokun-1 andGbetiokun-3 wells will be conducted using anearly production system (EPS) with initialestimated gross combined production atapproximately 15,000 barrels of oil per day (bopd)(6,750 bopd net to Elcrest). Start-up of the EPSis expected to be during Q1 2019.

Total to GreenlightIkike Project in NigeriaTotal’s CEO, Patrick Pouyanne, revealed that theFrench firm would approve plans to moveforward with the Ikike project in Nigeria in H1.The Ikike project would add around 60,000 bpdto Nigeria’s totals and is just one of severalprojects Total plans to take the FID onin Nigeria.

“There is a huge potential in Nigeria, it is probablythe most prolific country in west Africa in termsof oil and gas and it is time to launch new projectsand we are working on many of them,” Pouyannetold journalists.

The company could also take a FID on thedeepwater Preowi project which would addanother 70,000 bpd to Total’s production totalsin the West African country.

SDX’s South Ramadan Well Hits PaySDX Energy saw its SRM-3 well on Egypt’sSouth Ramadan concession reach its targeteddepth. The company said in a recent release thatthe well was drilled to a depth of 15,635 ft andencountered 75 ft of net conventional oil pay inthe Matulla section.

According to SDX, who holds a 12.75% stake inthe concession, drilling also encountered 20 ft ofnet conventional oil pay in the Brown Limestoneformation and a further 15 ft of net conventionaloil pay in the Sudr section. The well will becompleted in the Matulla section and then testedto establish whether the well will flow at acommercial rate.

South Sudan Signs NewCooperation Agreement with NigeriaSouth Sudan and Nigeria signed a cooperationagreement on oil and gas, trade, education, healthand culture, among others. Nigeria’s ForeignAffairs Minister, Geoffrey Onyeama, and hisSouth Sudanese counterpart, Nhial Deng Nhial,signed the agreement in Abuja.

According to Onyeama, the agreement is hopedto be a framework that will enhance their deeprelationship. Though the agreement did not includesecurity provisions, Onyeama said Nigeria wouldcontinue supporting South Sudan’s peace andstability efforts.

“For us, we believe it will be a win-win for thetwo countries to have meaningful and profitablecooperation,” he said. “We believe we can achievegreater things economically, socially and to reallypush for greater engagement between our twocountries,” he added.

Rockhopper Updates EgyptRockhopper Exploration reported thatcurrent production from the Abu Sennanconcession is approximately 3,800 boepd,broadly in line with average production ratesthroughout 2018.

The Al Jahraa-10 well, during Q4, reached totaldepth in the Abu Roash-F formation. Oil pay wascalculated in the Abu Roash-C and Abu Roash-D levels. Following testing operations, the wellwas brought into production from Abu Roash-Cat a rate of 130 bpd gross, and subject to furtherincrease. Upside potential exists in AbuRoash-D which is being evaluated for possibleacid stimulation.

Exploration well ASZ-1X located on Prospect Swas spudded on November 8 and was the first of

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two commitment wells to be drilled in the firstphase of the new concession. An oil discoverywas made in the Abu Roash-C level withpreparations underway to test and produce.The operator has applied to EGPC for adevelopment lease over the discovery.

Following joint venture approval, an active drillingprogram has been agreed for 2019 including thedrilling of one exploration well, two developmentwells and a water injection well. Activity in 2019continues to target the Al Jahraa field, as well asfurther exploration within the concession. Drillingis expected to commence in Q1.

The company also revealed that it is continuingto see an improvement in the payment situationin Egypt. At the end of 2018, Rockhopper’sEGPC receivable balance was approximately$1.5 million.

Sonangol Out as National ConcessionaireThe moves by the Angolan government to replacestate-run oil and gas firm Sonangol as thecountry’s concessionaire have borne fruit. As partof the country’s ongoing petroleum sectorreform, President João Lourenco created, bymeans of Presidential Decree 49/19, of

February 6, 2019, the National Petroleum, Gasand Biofuels Agency (Agência Nacional dePetróleo, Gás e Biocombustíveis, or ANPG).

The decree makes ANPG the NationalConcessionaire for the petroleum sector, thusreplacing the role played by Sonangol EP.This change implied the amendment ofSonangol EP’s by-laws, as approved bymeans of Presidential Decree No. 15/19, ofJanuary 9, 2019.

The ANPG, in the capacity of NationalConcessionaire for the petroleum sector, is grantedthe authority to award and manage oil and naturalgas contracts; prepare public announcements andpromote biddings for the award of exploration,development and production rights, as well asnegotiate and execute the relevant contracts. Inaddition, it will review and issue opinion on thetransfer to third parties of more than 50% of theshare capital of an associate of the NationalConcessionaire; audit the activities of oiloperators, with a view to assess the risks andverify the technical, financial, legal andaccounting compliance; and monitor all activitiesconducted under hydrocarbon exploration andproduction contracts.

LNA Takes Over El Sharara FieldIn Libya, forces loyal to the Libyan commanderin the East, Khalifa Haftar, have captured the ElSharara oilfield. Haftar Libyan National Army(LNA) forces took over the facility from armedtribesmen and state guards. The LNA said it hadmet no resistance.

The LNA called on state-run oil firm, NOC, tolift the force majeure that was placed on the fieldwhen it shut in production at the 315,000 bpdfield.

The oilfield was taken over by groups oftribesmen, armed protesters and state guardsdemanding salary payments and developmentfunds almost two months ago. In January, Haftar’sforces started an offensive in the south to fightmilitants and secure its oilfields, and said it hadmade good on the promise by moving on the ElSharara field. “Our forces arrived safely at thefield,” a spokesman for the forces, AhmedMismari, told a news conference.

NOC operates Sharara in partnership withRepsol, Total, OMV and Equinor. According toa Twitter post by OMV, the field could reopenin March.


AFRICA AT LARGE

Brulpadda-1AXSpuds Offshore South AfricaAfrica Energy Corp. saw the spud of theBrulpadda-1AX re-entry well on Block 11B/12Boffshore South Africa. The Brulpadda-1AXexploration well is being drilled in 1,432 meterswater depth by the Odfjell Deepsea Stavangersemi-submersible rig to a total depth of 3,420meters subsea.

Garrett Soden, Africa Energy’s President andCEO, commented, “The Brulpadda-1AXexploration well is a world-class, basin-openingopportunity in one of the last under-exploredregions offshore Africa. We look forward todrilling results in the first quarter of 2019.”

Block 11B/12B is located in the Outeniqua Basinapproximately 175 kms off the southern coast ofSouth Africa. The area has a proven petroleumsystem from the nearby Sable and Oryx oilfields. The Brulpadda Prospect is one of fivesimilar submarine fan prospects with directhydrocarbon indicators defined utilizing 2Dseismic surveys acquired across thePaddavissie Fairway in 2001 and 2005. TheBrulpadda Prospect has gross prospectiveresources of more than 500 million barrelswith significant follow-on potential in thesuccess case.

The well will test the oil potential in a mid-Cretaceous aged deep marine fan sandstonesystem within combined stratigraphic/structuralclosure. Drilling and evaluation of the well isexpected to take approximately 85 days with agross budget of approximately $154 million,including contingency for downtime dueto weather.

Africa Energy holds a 4.9% effective interest inBlock 11B/12B, through its 49% of the shares inMain Street 1549 Proprietary Ltd, which has a10% participating interest in Block 11B/12B.Total SA is operator and has a 45% interest inBlock 11B/12B, while Qatar Petroleum andCanadian Natural Resources Ltd have 25% and20% interests, respectively.

Ghana Bid Round Generates InterestGhana’s Ministry of Energy revealed that it hasreceived applications from 16 oil and gascompanies for one or more of five offshore blocksoffered in its first exploration licensing round.The companies include Aker Energy, BP, Cairn,CNOOC, ENI, Equinor, ExxonMobil, First E&P,Global Petroleum Group, Harmony Oil and Gas,Kosmos Energy, Qatar Petroleum, Sasol, Total,Tullow and Vitol.

The Ministry says the applications includeexpressions of interest in competitive bidding forthree blocks in the Western Basin and for directnegotiations regarding another two blocksoffshore Ghana.

Ghana sees the interest as a major vote ofconfidence in the country, which seeks to unlockmore resources than its current production of200,000 bpd of oil including the Jubilee Field’s100,000 bpd.

VOG Receives PresidentialDecree for the Matanda PSCVictoria Oil & Gas’ (VOG) wholly ownedsubsidiary, Gaz du Cameroun, (GDC), receivedthe Presidential Decree authorizing the transferof interest in the Matanda PSC license assignedfrom Glencore in early-2016. Cameroon’sPresident Paul Biya signed the decree onDecember 17.

The terms of the assignment include the transferby Glencore of 75% of its participating interestin the PSC to GDC and 15% of its participatinginterest to AFEX, who previously held a 10%interest. Cameroon’s state-run oil and gas firm,SNH, has a 25% back in right after an exploitationlicense is granted.

As consideration for the assignment, GDC willbecome operator and will assume responsibilityfor carrying out the Work Program agreed to withthe government. The agreed obligation for thiswork program is one exploration and appraisalwell plus reprocessing of existing seismic in thefirst two-year period of the PSC.

Matanda covers an area of approximately 1,235sq km and is highly prospective for natural gasand gas condensate. It contains the previouslydiscovered offshore North Matanda Field withcurrent 2C recoverable gas resources of 150 BcfGross and 6 million barrels of condensate andupside of 1 Tcf of gas. In addition, there arefurther onshore prospective resources of 1,303Bcf of gas contained in 23 identified prospectsand leads.

GDC and AFEX will focus on the onshoreprospects located adjacent to the Logbabaconcession. The close proximity of the existingLogbaba gas pipeline network will also allow fornew discoveries on Matanda to deliver additionalnatural gas to industrial users in Cameroon.

Preliminary Resultson Tendrara Well PositiveSound Energy saw positive preliminary resultsof intermediate wireline logs on its TE-10 wellin Morocco. The initial results indicate thepresence of gas bearing sands in the TAGI.

Sound is currently part way through its three-well exploration program on the Tendrara Area.The drilling program is designed to explore threegeologically-independent plays and to establishthe potential of the basin. The TE-10, the secondwell in the program, was designed to target botha material TAGI stratigraphic trap and a smallerTAGI structural closure in the company's GreaterTendrara permit.

The well is located about 25 kms to the northeastof the recently awarded Tendrara productionconcession, which contains the TE-5 Horstdiscovery unlocked by Sound Energy in2016-17.

The TE-10 well has, so far, been drilled to2,098.5 meters total measured depth, penetratingthe top of the TAGI sand sequence at a measureddepth (MD) of approximately 1,892 meters.

Based on cuttings and the results of preliminarywireline interpretation, there is a potential grossreservoir interval from 1,899 meters MD to 2,009meters MD. After completion of the intermediatelogging program, Sound plans to drill the remainingTAGI section to total depth just beneath theHercynian Unconformity and then perform a welltest, including possible mechanical stimulation.The company will also initiate seismic analysis toestablish the internal estimated gas resources ofthe structural closure and the upside potential ofthe North East Lakbir stratigraphic trap.

Ground works for the drilling of the third well inthe exploration program, the TE-11, are expectedto commence after the TE-10 well test.

Gabon Makes Listof Top 10 Discovered ResourcesAlthough it is still early in the new year, numbersare being calculated in the industry to rank 2018’sstanding for oil and gas exploration successesaround the world. The lone African countrymaking the list has a long history of oil production

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but is currently on the downward trend as itscrude resources deplete.

Gabon came in as the country with the ninthbiggest resources discovered in 2018. Accordingto Rystad, Gabon had 203 million boe indiscovered resources. Over 2018 the most notablediscoveries for Gabon were made by Petronas,Repsol, and BW Offshore.

Petronas hit in early 2018 with the drilling of theBoudji-1 exploration well on the Likuale Block.The well encountered both oil and gas whiledrilling. The ultra-deepwater exploration well,drilled in water depths of 2,800 meters,encountered 90 meters of gross high-qualityhydrocarbon-bearing pre-salt sands. Repsol hitwith the drilling of the Ivela-1 exploration wellin the Lower Congo Basin, in the Luna Muetse(E13) Block. Repsol, partnered with Woodside,hit when they intersected a 78-meter gross oilcolumn while drilling.

BW Offshore made multiple discoveries over2018 on the Dussafu License’s Tortue field. Thecompany hit with the DTM-3, DTM-3H, and theDRNEM-1 appraisal well. The well encountered40 meters of pay in the Gamba and Dentaleformations in the original wellbore. An appraisalside-track was drilled approximately 800 metersnorth-west of the original wellbore andencountered 34 meters of pay in the Gamba andDentale formation.

For more information on the global explorationfindings for 2018, see Global ExplorationRebounds Over 2018 in the Around World section.

Equa G DeniesOphir the Fortuna ExtensionUnfortunately for Ophir Energy, it receivednotification from the Equatorial Guinea Ministryof Mines and Hydrocarbons that the Block RLicense, which contains the Fortuna gas discovery,will not be extended. The license expired onDecember 31, 2018.

As a consequence, there will be an additionalnon-cash impairment of the asset, expected to bearound $300 million, in Ophir’s full yearfinancial results following the impairmenttaken in the half year results reported inSeptember 2018.

According to the company, it remains focused onimplementing the strategy outlined in itsannouncement on September 13 and optionsavailable to maximize value for shareholders. Inthis regard, the Board would highlight the recent

updates it has provided to the market in respectof its Southeast Asia holdings, which it believesdemonstrate the underlying quality of these assets,including its recent acquisition of Santos.

Ophir and Medco have entered into discussionsabout a possible cash offer to be made by Medcofor the entire issued and to be issued sharecapital of Ophir. Discussions with Medco havetaken place in the shared knowledge that therewere a number of potential outcomes withrespect to our Fortuna asset, and thesediscussions continue.

Alan Booth, Interim CEO of Ophir, commented,“It is disappointing that the Ministry has decidednot to extend the license, despite the amount ofeffort and cost dedicated to the delivery of theproject and especially as we were still talking tohighly credible potential co-investors.Nevertheless, we will continue to workconstructively with the authorities in EquatorialGuinea. I should like to thank everyone in theOphir project team; you gave this your verybest endeavors.

“Looking ahead, the Group’s cashflow, capitalcommitments and growth prospects will befocused in Southeast Asia, where we have builta robust operating platform capable of deliveringvalue to shareholders.”

Trendsetter EngineeringScores West Africa ContractTrendsetter Engineering will deliver three templateslot adapters (TSA) and associated TCSconnectors to a major operator in West Africa.The equipment will be delivered this quarter fromTrendsetter’s Houston facility.

By utilizing the TSA the operator will be able toreconfigure the template and associated manifoldslots to allow for the tie-in of satellite trees withoutremoving existing wellhead systems or productionguide bases

According to Trendsetter, this technology providesthe flexibility to add new wells, ultimatelyeliminating the need for specialized tooling andsignificantly reducing the vessel timenecessary to complete the tie-ins that aretraditionally required to connect the template toa satellite well.

Under the contract the company’s scope of thework includes the design and manufactureof the TSAs, Trendsetter’s TC7 ClampConnection Systems, and TC2 ColletConnection Systems.

Anglo African Updates Tilapia DrillingAnglo African Oil & Gas updated drilling on theTilapia field in the Republic of Congo (ROC).On commencing drilling of TLP-103, TLP-101,which was producing around 30 bpd at the time,had to be taken offline due to the proximity ofthe flare to the drilling apparatus. The companyhas now upgraded and relocated the flare to enableproduction from TLP-101 to continue duringdrilling. TLP-101 has been brought back intoproduction and has now produced an average of55 bpd during a two-week test period.

During the downtime, Anglo African engaged aspecialist reservoir engineering company toconduct a full review of wells TLP-101 and TLP-102 which followed on from the stimulationexercise performed on well TLP-102, successfullyconducted earlier in 2018. The results of thesestudies have shown connectivity between the twowells. Due to this connectivity the reservoirengineering company has recommended usingTLP-102 as a water injector to enhance productionfrom TLP-101.

Studies of this strategy by both AAOG and thespecialist reservoir engineering company predictthat using a water injection system could lead toa rise in production from TLP-101 to up to 400bpd. It is now obtaining estimates for the cost ofthis work and assessing the commercial viabilityof this project.

UAE to Participatein Namibian Oil and GasNamibia reached an agreement with the UAE toboost relations in the oil and gas sector. The oiland gas agreement came as the two countries metto discuss ways to strengthen cooperation.

During a meeting between Abu Dhabi CrownPrince Sheikh Mohammed bin Zayed AlNahyan and Namibian President Hage Geingob,bilateral relations between the two countrieswere addressed. During the cooperation talks, theEmirati crown prince affirmed his commitmentto begin exploring for oil and gas in Namibia. Itcomes after the two countries built up strong

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ties through the Al-Dahra Namibia project adecade ago.

Wireline LoggingConfirms Tilapia DiscoveriesSchlumberger completed wireline logging onAnglo African Oil & Gas’ (AAOG) TLP-103Cwell on the Tilapia field in the Republic of Congo.The wireline logging confirmed multiplediscoveries on the Tilapia license.

AAOG said that the wireline logging validatesthe initial results identified during drilling thetargeted R1/R2/R3 and the Mengo reservoirs andconfirms oil columns amounting to an aggregateof 44 meters across the identified horizons.

The company will now resume drilling operationsat TLP-103C, targeting the deeper Djeno horizonwhich is known to be a prolific producer onneighboring fields.

Unity Wells Back OnlineSouth Sudan is in the midst of reviving its oilproduction and has restarted production in theUnity region. According to a Bloomberg Newsreport, 16 wells have been restarted. The 16 wellshad been shut in since 2013.

These wells were brought back online thanks tothe joint efforts by the two Sudan’s efforts tosecure facilities. The sector is vital to both Sudan’seconomies; South Sudanese production passesthrough pipelines on Sudanese territory andKhartoum draws significant transit costs.

South Sudan produces about 150,000 bpd andaims to double that capacity by the end ofthis year.

Cameroon Greenlights Bolongo LicenseCameroon approved the alliance betweenGlencore and state-run firm SNH, for theexploitation of the Bolongo block in the Rio delRey Basin. The license, in which Glencore holds75% stake, was given the greenlight by thegovernment through presidential decree onJanuary 8. The license is valid for 20 years andrenewable for one period of 10 years.

Glencore had submitted an application for theexploitation of hydrocarbons on this block to theCameroonian authorities in June 2017. This cameafter a long exploration phase and a PSC signedwith SNH in 2009.

Pecan-4A Nears CompletionAker Energy, operator of Ghana’s DeepwaterTano Cape Three Points (DWT/CTP) block, is

about to complete a successful drilling operationof the Pecan-4A appraisal well. The well wasdrilled at the Pecan field in the DWT/CTP blockto a vertical depth of 4,870 meters in 2,667 metersof water.

The DWT/CTP block offshore Ghana containsseven discoveries, of which Pecan is the maindiscovery to date. The main purpose of the Pecan-4A appraisal well was to confirm Aker Energy’sunderstanding of the geology in the area and toidentify deep oil water contact in the Pecanreservoir. This was successfully proven.

According to Aker, based on existing subsurfacedata from seismic, wells drilled and an analysisof the Pecan-4A well result, the existingdiscoveries are estimated to contain grosscontingent resources (2C) of 450 – 550 millionboe. Aker Energy estimates that with the nexttwo appraisal wells to be drilled, the totalvolumes to be included in a Plan of Development(POD) have the potential to increase to between600 – 1,000 million boe. In addition, there areidentified multiple well targets to be drilled aspart of a greater area development after submissionof the POD.

Genel Completes Seismic in AfricaGenel Energy issued an update on its ongoingactivities in Africa, specifically onshoreSomaliland and offshore Morocco. In Somalilandon the SL-10-B/13 block, where Genel holds a75% stake and is operator, the company completedseismic processing. Genel said that analysis andinterpretation are underway.

Initial indications confirm Genel’s view that theblock has hydrocarbon potential. Genel continuesto develop a prospect inventory and assess nextsteps ahead of a farm-out process and potentiallyspudding a well in 2020. On the Odewayne block,further seismic processing is being considered inorder to complete the company’s understandingof the prospectivity of the block.

On the Sidi Moussa block offshore Morocco, theacquisition of around 3,500 sq km of multi-azimuth broadband 3D seismic completed inNovember. PSTM and PSDM processing willcontinue through 2019. Genel has no additionalwork commitments relating to the license. Adecision will be made on whether to drill a well,and the appropriate equity level, once processinghas progressed sufficiently.

Tlou Recommences Drilling at LesediTlou Energy has recommenced production poddrilling on its Lesedi CBM project in Botswana

and specialist directional drilling crew and otherkey personnel are now on site.

Following the drilling of the lateral wells, theLesedi 3 and Lesedi 4 production pods will becompleted prior to the installation of surfaceproduction facilities. Dewatering and productiontesting can then begin. According to the company,it is successfully flowing gas at Lesedi 3 & 4 andhas the potential to upgrade its reserves.

A comprehensive tender was recently submittedas a response to a Request for Proposal (RFP)for supply of CBM (for gas-to-power) to thegovernment of Botswana. Discussions with otherpotential off-takers as well as development financeproviders is in progress. An Environmental ImpactAssessment for the power generation facility aswell as the transmission lines to connect to theelectricity grid has also now been submitted.

Airborne Oil & Gas Scores Total ContractAirborne Oil & Gas was awarded a contractfrom French major Total to supply a TCP(Thermoplastic Composite Pipe) Jumper for adeepwater project in West Africa. The field islocated approximately 150 km offshore in waterdepths of up to 1,600 meters.

This contract follows the successful completionof a rigorous testing program, in which Totalqualified Airborne Oil & Gas’ TCP Water InjectionJumper for permanent subsea applications.

Under this contract, Airborne Oil & Gas willprovide Total with a 5.2” ID, 370 bar designpressure TCP Jumper for water injection. TheTCP Jumper is intended to be terminated incountry and installed using a subsea pallet,deployed from a small vessel. The TCP Jumperis non-corrosive, lightweight, flexible,spoolable with a small minimum bend radiusand can be terminated at any location along thepipe. This provides the end user with projectvalue in lower total installed cost through costeffective transportation, and removing theneed for metrology, while de-risking theproject schedule.

The Airborne Oil & Gas TCP Jumperfor Total being spooled

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TEN and Jubilee Field UpdateTullow Oil and its partners in Ghana on the Jubileefield saw their 2018 production from the fieldaverage 78,000 bpd. This was slightly belowTullow’s November forecast.

Tullow said in its latest update that missing itsNovember forecast was due to minor operationalissues in December, which have now beenresolved. Tullow expects 2019 average gross oilproduction from the Jubilee field to increase toaround 96,000 bpd.

On Ghana’s TEN fields, Tullow said the fieldsperformed well throughout 2018 with grossproduction averaging 64,500 bpd, in line withexpectations. Tullow expects gross oilproduction from the TEN fields in 2019 to stepup significantly to around 83,000 bpd andgross gas production is expected to be around2,100 boepd.

The partners’ 2018 drilling program wassuccessfully executed with two drilling rigsoperating in tandem across both fields. The resultsfrom drilling were in line with, or exceeded, pre-drill expectations. Two new producer wells weredrilled and completed at Jubilee and an existingwater injection well was completed.

At TEN, two new producing wells and one waterinjection well were drilled. The first newproducer well, NT05-P, was brought online inAugust 2018 and is performing very well. Thesecond new producer, EN10-P, is currentlybeing completed and is expected to be onlinein February.

In 2019, Tullow expects to drill and completeseven new wells across the TEN and Jubilee fieldsallowing gross oil production from Ghana to riseto approximately 180,000 bpd in line with the2019 production forecast.

Uganda Partners Make ProgressTullow Oil and its partners in Uganda, Total andCNOOC Ltd., continue to work with thegovernment of Uganda to finalize the farm-down.According to Tullow, the farm down is expectedto be complete in H1 2019.

The operators of the Uganda developmentcontinue to target FID for H1 of this year onceagreements with the governments of Uganda andTanzania have been completed.

Galp Ready for Namibia SurveyGalp Energia is set to start its 3D seismic campaignoffshore Namibia imminently. The survey, to beshot on PEL 83, will cover a total area of 3,000sq km. The company expects the survey to becomplete in March. The seismic contractor isPolarcus UK Ltd.

The acreage is located in deepwater, in what isconsidered to be a frontier exploration basin,approximately 260 km from Lüderitz.

CGG Extending Multi-ClientFootprint to Offshore GabonCGG is extending its Gabon multi-client datafootprint. The company said it will conduct a9,800 km long-offset 2D seismic survey in anunexplored deepwater area of the SouthBasin. This newest survey builds on the successof its 25,000 sq km 3D BroadSeisTM survey,which led to the recent Boudji-1 and Ivela-1oil discoveries.

A subset of the data over the offered licenseblocks will be available in advance of Gabon’s12th offshore licensing round planned forJune 2019.

The new 2D data will help define the full extentof existing and new plays in the region. It willalso aid in understanding the thickness variationsin the sediment overburden for source rock andmaturity analysis. CGG’s advanced broadbandprocessing workflow will increase the resolutionand improve the characterization of the turbiditesystems that represent potential exploration targets.The low frequencies delivered will provide deeppenetration to enhance understanding of the natureof the deep crust. New insights from this surveywill expand and update CGG’s currentJumpStartTM integrated geoscience package.

Tunisia Expects Gas BoostTunisia plants to boost its natural gas productionby the end of this year. According to the TunisianMinister of Industry and Energy, Slim Feriani,gas production is expected to almost double thisyear, from 35,000 boepd to 65,000 boepd. Thisis due mainly to the highly anticipated Nawaragas project, operated by OMV, coming online.

“We will increase our production by about 30,000boepd as soon as the Nawara project in the southof the country begins,” Feriani said in interviewwith Reuters.

Among other things, Nawara will increaseTunisian gas production by 15% and reduceimports from Algeria by 30%. In addition tonatural gas, it should open up to the productionof condensate and LPG.

ROC Paints PositivePicture for New Licensing RoundResults from the Republic of Congo’s (ROC)first licensing round, with the award of blocks toKosmos Energy and Perenco, and theprovisional attribution of a block to Total, presenta positive backdrop for the country’s secondround which will close in June 2019, saysGlobalData.

GlobalData’s ‘Republic of Congo Upstream Fiscaland Regulatory Report’ explains that this secondlicensing round offering 18 blocks will be thesecond test for the new hydrocarbons framework,introduced over two years ago when the ROCadopted its new hydrocarbons code and productionsharing model.

GlobalData says that regionally, the ROC presentsrelatively attractive contractual terms for oil andfavorable terms for natural gas.

Alessandro Bacci, Oil and Gas Analyst atGlobalData, commented: “Much of the fiscalburden under new contracts is linked tonegotiable terms and may therefore depend onthe levels of investor interest. The results of thefirst round appear encouraging, though after theclosing of the first licensing round, it took a longtime to award the blocks to the IOCs.Additionally, five blocks on offer through thesecond licensing round were alreadyu n s u c c e s s f u l l y o f f e r e d d u r i n g t h efirst round.”

The report also notes that the country aims toincrease the development of its gas sector.Specifically, promoting development throughfour avenues: gas to power (the only oneimplemented right now), gas to industry,petrochemicals projects, and gas export.

Bacci adds: “Although the new hydrocarbonscode has improved gas terms, the passage of anew gas code is crucial to support suchdevelopments. Most gas projects are in the earlydesign stages, and a clear government policy andregulatory environment will be needed toattract investment.”


DOWNSTREAM NEWS

BP and SOCAR Sign Petchem HoABP and SOCAR Turkey signed a heads ofagreement (HoA) to evaluate the creation of aJV that would build and operate a world-scalepetrochemicals complex in Turkey. The proposedfacility, to be located in Aliaga in western Turkey,would produce 1.25 million tons per annum (tpa)of purified terephthalic acid (PTA), 840,000 tpaparaxylene (PX), and 340,000 tpa benzene.

Following the signing of the HoA, BP andSOCAR Turkey now expect to undertake designwork for the facility, which would allow for theintegration of feedstock supplies from the nearbynew STAR refinery and Petkim petrochemicalscomplex, both owned by SOCAR Turkey. BPand SOCAR expect to work towards a potentialfinal investment decision in 2019, which couldresult in start-up of the new petrochemicalplant in 2023.

BP’s latest proprietary PTA technology hassignificantly lower capital and operating costswhen compared with other PTA technologies. Itis more energy efficient, uses less water andproduces less solid waste than similar technologieson the market.

Area 4 PartnersSecure Offtake CommitmentsMozambique’s Area 4 co-venture participantshave secured LNG offtake commitments fromaffiliated buyer entities of the partners. This is akey milestone that enables the participants torapidly move toward an FID in 2019 on the firstphase of the Rovuma LNG project. Thesecommitments are subject to the conclusion offully-termed agreements, and the approval of thegovernment of Mozambique.

Area 4 participants are ExxonMobil, ENI, CNPC,Mozambique’s state firm ENH, Kogas, and Galp.

In July 2018, Mozambique Rovuma Venturesubmitted the development plan to the governmentof Mozambique for the first phase of the RovumaLNG project, which will produce, liquefy andmarket natural gas from the Mamba fields locatedin the Area 4 block offshore the Rovuma Basin.ExxonMobil will lead construction and operationof natural gas liquefaction and related facilitieson behalf of the Area 4 joint venture, while ENIwill lead the construction and operation of theupstream facilities.

The development plan for the first phase of theRovuma LNG project specifies the proposeddesign and construction of two liquefied naturalgas trains, which will each produce 7.6 million

tons of LNG per year. Mozambique RovumaVenture is currently holding productivediscussions with the Mozambican governmenton development plan details.

Penspen AwardedFEED for Nigeria/Morocco PipelinePenspen was awarded a contract by Morocco’sONHYM and Nigeria’s NNPC to execute thefirst phase of the FEED for an approximate 5,700-km gas pipeline proposed to run from Nigeria toMorocco. The work has already started and isbeing executed from Penspen’s Abu Dhabi office.The award is a follow-up on the feasibility studycompleted by Penspen in July 2018.

The FEED Phase I consists of a detailed reviewof the feasibility study results and in-depthevaluation of the gas demand and supply study.Further design of the pipeline system, in additionto the execution of an Environmental and SocialImpact Assessment (ESIA), will then be carriedout with the aim of optimizing the proposedpipeline route and project economics. Penspenwill also support the client in marketing andpromoting the pipeline project to potentialstakeholders showcasing the wider benefits of itsdevelopment.

At the end of the study, key detailed outcomeswill help the client prepare for the second phaseFEED Phase II, which is expected to lead to afinal investment decision.

Penspen will be utilizing the skills and capabilitiesof Dar Al-Handasah, Crestech and Control Riskto conduct a number of specialty studies requiredfor the FEED services, environmental impactassessment, Nigeria gas supply study and riskstudy respectively.

Saipem JV Contractedfor Artic LNG ProjectSaipem, in JV with Renaissance, was awarded anew Onshore E & C project in the RussianFederation worth €2.2 billion overall. The contracthas been awarded by the company Artic LNG 2,consisting of Novatek JSPC (60%) andEkropromstroy Ltd (40%).

The project will be executed in the TazovskyDistrict, in the autonomous administrative regionof Yamal-Nenets, in the western part of theGydan Peninsula.

The project encompasses the construction of threeLiquefied Natural Gas (LNG) plants, each witha capacity of about 6.6 million tons per annum(MTPA), that will be installed on Concrete GravityBased Structures (GBS) and includes LNG storagefacilities totaling 687,000 m3.

The works entrusted to the JV comprise the designand build of the three 30-meter high concretegravity based structures (Concrete GBS) on asurface of 330 x 152 meters. These ConcreteGBSs will be fabricated in two dry docks in aNovatek provided facility in Murmansk.Subsequently, they will be towed and installedin Gydan.

The contract forms part of a strategicpartnership agreement signed by Saipem andNovatek in 2016 for activities associated withLNG projects.

Ghana Preparesto Transport Sankofa GasGhana aims to complete work on the infrastructureneeded to transport natural gas from the offshoreSankofa field for processing onshore. The Sankofafield is located on the Offshore Cape Three PointsBlock (OCTP). Speaking to the press, Nana KofiDamoah, head of communications at the GhanaMinistry of Energy, said that work will becomplete next August.

The government’s announcement follows criticismfrom the parliamentary minority that the delayin the delivery of the facilities was costing thepublic a lot of money.

An agreement signed between the governmentand the project partners, headed by ENI, providesfor Ghana to purchase 90% of the gas producedon site, according to a take or pay mechanism.Under the take or pay, whether the governmentbrings the gas onshore or not, it will have to payabout $6 million a month to the producerconsortium.

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Shell Starts Productionat Geismar Petchem ExpansionShell Chemical LP (Shell) saw the start ofproduction of the fourth alpha olefins (AO) unitat its Geismar, Louisiana, USA chemicalmanufacturing site. The 425,000-ton-per-yearcapacity expansion brings total AO productionat Geismar to more than 1.3 million tons perannum. Start-up operations began inDecember 2018.

This successful completion of the majorexpansion project makes Shell’s Geismarchemicals manufacturing site the largest producerof alpha olefins in the world.

Alpha olefins are key ingredients in many finishedproducts that people use and enjoy every day,including laundry detergents, motor oils, andhand soaps.

The new unit strengthens Shell’s leadingposition in the US Gulf Coast and illustrates thestrategic value of its integrated downstreambusiness. The Geismar site is supported withadvantaged ethylene feedstock from Shell’s nearbyNorco, Louisiana and Deer Park, Texasmanufacturing sites, enabling the site to respondto market conditions.

The expansion project contains around 3,570 tonsof steel, 18,290 meters of concrete and 85 linearkm of pipe. Several new pieces of infrastructurewere built as part of the expansion, including anew water-cooling tower, a significantexpansion of the site’s rail loading capabilities,and the repurposing of a previously idledtank farm.

NOC Signs Contractfor Benghazi ComplexLibya’s National Oil Corporation (NOC) signeda contract with the French building andengineering group Artelia to manage an ambitiousdevelopment plan for their new complex inBenghazi. The contract was signed by thechairman of NOC, Mustafa Sannallah, and Arteliaexecutive director, Alberto Romeo, in Milan.

“The NOC’s new facilities in Benghazi will reflectour potential as a country and the globalimportance of Libya’s oil sector. There is a brightfuture for our country if we can put conflict andinstability behind us,” said Sannallah.

The NOC reports that the project would includethe headquarters for NOC and other oil companies,as well as government departments, a hotelcomplex and a conference center. The financingwill come from commercial banks, but no detailswere given as to the cost of the project.

Demand Continuesto Grow for Wentworth GasWentworth Resources reported that gas demandfor its producing reserves in Tanzania continuedto grow in Q4 2018, resulting from combineddemand from the Kinyerezi-1, Kinyerezi-2, andUbungo II power stations, and the burgeoningdemand growth from industrial customersincluding Dangote Cement and GoodwillCeramics.

The company said that this demand from off-takers collectively resulted in an average dailyproduction in Q4 2018 of 87.3 Mmscf/d, and forthe month of December 2018 of 92.5 Mmscf/d.

The average production for the full year 2018was 83.2 Mmscf/d; above the company’s 2018production guidance range of 65 - 75 Mmscf/dand greater than the Daily Committed Quotient(DCQ) of 80.0 Mmscf/d, which the Joint VenturePartners are required to supply under the GasSales Agreement with TPDC and for theTanesco-owned Mtwara Power Station(ca.2.5 Mmscf/d).

Wentworth and TPDC are continuing discussionswith regards to reducing the Madimba gasreceiving facility export pressure from the current92.5barg to around 75barg. This will allow for asustained overall production rate and/or plateauperiod from the current well stock, prior toinstallation of compression facilities. This istechnically and operationally feasible and has thepotential to extend the production plateau byabout 18 months on a standalone basis and about42 months including slickline and chokes upgradework; and would be immediately accretive toasset value.

Over 2019 the company anticipates further growthin its gas demand with the extension to theKinyerezi-1 power plant which is expected tocome online in Q4 2019. This facility will initiallyrequire 5 Mmscf/d and will build up toapproximately 30 Mmscf/d of gas requirement

when fully commissioned over a six-month period.Continued gas demand growth in 2019 is alsoexpected, primarily from the Dangote CementPlant and other smaller industrial consumers;adding an additional 10-15 Mmscf/d to nationaldemand needs by Q2 2019.

Algeria/ExxonMobil Deal to ConcludeAlgeria and ExxonMobil will conclude a dealand set up a trading JV before the end ofH1 2019, Sonatrach’s CEO Abdelmoumen OuldKaddour said.

“We are very optimistic, and things are movingin the right direction, so we will conclude withExxon and have our trade JV,” the CEO toldreporters. No further details were offered byOuld Kaddour.

Sonatrach has previously said it wanted a shalegas cooperation deal with the U.S. major.Sonatrach also said previously that it was in talkswith more than a dozen international companiesover a JV to trade oil and gas products afteragreeing to buy its first overseas refinery.

Total/Sonangol Create Retail JVTotal and Sonangol have established a JVcompany aimed at developing common retail anddistribution activity in the country. The Total-Sonangol JV will initially focus on fueldistribution and lubricants sales on thebusiness to consumer (B2C) segment, startingwith a network of service-stations under theTotal brand.

Depending on the outcome of the ongoingliberalization process, Total said it also intendsto address petroleum products logistics and supply,including imports and primary storage of refinedproducts through this partnership.

Under the current agreement, Sonangol will bringin 45 already existing urban and highway retailstations, with a key presence on selected locationsin 10 coastal and central provinces. Total willwork alongside Sonangol to rapidly develop thisnetwork, in order to meet the highest internationalretail standards and improve fuel qualitydistribution throughout the country.

The newly-established company will invest inboth infrastructures and marketing activities andwill benefit from Total’s expertise in retail andits customer-minded approach.

VOG Resumes Supplies to ENEOVictoria Oil & Gas (VOG) resumed gas supplyto Cameroon’s 30-MW Logbaba Power Station

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in late-December. Gas supply and powerdistribution commenced shortly thereafter. Sincethe resumption of the contract with ENEO in lateDecember, ENEO consumption levels havedoubled from 15 MW to the full 30 MW atLogbaba as the equipment has beenrecommissioned.

ENEO gas consumption has recently exceededtake or pay levels of 4.88 Mmscf/d.

The term sheet with ENEO sets out a three-yearcontract duration with peak delivery of 6.1Mmscf/d to be made available to the Logbabastation on an 80% minimum Take or Pay basisthroughout the year, which equates to a minimumaverage additional gas supply of 4.88 Mmscf/d.

This differs from the previous contract, whichcontained a seasonal minimum take or pay elementof 90% during the January to June dry seasonand 30% during the wet season July to December.The initial gas sale price of $6.75 per MMBtuwill increase over the three-year term of theagreement by $0.10/MMBtu on each anniversaryof the effective date of the agreement.

While gas supply for grid power to ENEO andto others will always be a key strategy of VOG,the Board, as previously announced, is focused

on the importance on the diversification of thecustomer base to reduce dependence on anysingle customer.

Saudi Arabia PlansSouth African Petchem ProjectSaudi Energy Minister Khalid Al-Falih and hisSouth African counterpart Jeff Radebe revealedthat the Saudi kingdom will build an oilrefinery and a petrochemical plant in the sub-Saharan African country. The project is part ofSaud i Arab i a ’s $10 b i l l i on g loba linvestment project.

The two ministers held bilateral talks in Pretoriato discuss details of the $10 billion investmentannounced in July 2018. They also discussed thepossibility of Saudi Aramco, the Saudi state-owned oil company, using South African oil tanksin Saldanha to store crude oil.

No details on the plant’s capacity were disclosed,but both sides plan to start feasibility studies forthese short-term projects.

According to South Africa’s Ministry ofEnergy, Saudi Arabia’s importance as atrading partner cannot be overstated since itsupplies 40% of the crude oil processed inSouth Africa.

Dangote Expects Refinery Next YearAliko Dangote told reporters that his companyis on track to finish its $15-billion refinery bynext year. The refinery, when complete, will beone of the world’s largest. While the timeline isambitious Dangote told reporters, “There arequite a lot of challenges, but we’re moving. We’restill targeting next year for commissioning.”

Dangote said the plant willexport about 35% of theplant’s products, while therest will serve the domesticmarket. Dangote Industriessaid in 2018 that the plan wasto produce about 50 millionliters a day of gasoline and15 million liters of diesel, though output can bechanged according to demand.

The Dangote complex will include a fertilizerplant with a 3-million metric ton annual capacity,set to be ready this year, and a petrochemicalplant. They will be powered by gas, which willbe sent from the Niger River delta via two 550-km underwater pipelines, also costing Dangoteabout $2.5 billion.

“By next year, we’ll be exporting almost 2 millionmetric tons of urea and ammonia,” Dangote said.

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fter a year of rebound and recovery, Africa’s old and newhydrocarbons markets have an opportunity to further entrenchthe continent’s position as the world’s hottest oil and gas

frontier in 2019. However, the new year also brings a new set ofdynamics and challenges set to influence the future of the industry,from presidential elections to megaproject developments, amidstintensifying international competition.

New African frontiers opening upIndependents are leading the way in exploring and opening up newfrontiers across Africa. This year will be key for the advancement ofnew exploration and production development projects from West toEast Africa. Developments to watch notably include Senegal’s SNEfield development, where FEED works are ongoing and a finalinvestment decision (FID) is expected by Woodside Energy and CairnEnergy this year; Niger’s Amdigh oilfield development, where SavannahPetroleum’s $5 million early production scheme is set to start anytimesoon; and the opening up of Kenya’s South Lokichar Basin by TullowOil, where FID is also expected before year end amid rising tensionswith the Turkana local community.

A year to confirm Africaas a global exploration hotspotOngoing bidding rounds in key existing and new African hydrocarbonsmarkets will tell if Africa further confirms its position as the world’snew exploration hotspot and manages to attract necessary investmentin its oil and gas acreages.

Among well-established African producers, OPEC members Gabonand Congo-Brazzaville each have ongoing bidding rounds. Gabon’s12th shallow and deep-water licensing round is set to close in April2 0 1 9 a n d C o n g o -Brazzaville’s Licenseround phase II in June2019. With both countriesstruggling to implementtheir new HydrocarbonsCodes, the success of these rounds will tell if investors have beenconvinced by policy reforms developed over the past two years.

Two bigger African producers and also OPEC members, Nigeria andAngola, are set to launch landmark and out-of-the-ordinary biddingrounds this year. Nigeria will auction its gas flare sites under theNigerian Gas Flare Commercialization Program, likely to happen afterthe February general election, and Angola will hold its Marginal FieldsBidding Round, the result of a new May 2018 policy enacted byPresident Lourenço, and to be launched at the Africa Oil & Power

conference in Luanda in June 2019. With the Nigerian PetroleumIndustry Bill yet to be signed and the ink still fresh on Angola’s newpolicy regime, both rounds will also be key in assessing investors’interest for both countries’ business environments.

Also attracting interest is the newest and arguably one of the upcomingentrants – Ghana – holding its 1st formal licensing round set to closein May 2019 which has reportedly got the attention of 16 oil companies,including majors ExxonMobil, BP, Total and ENI. As a hopeful newEast African offshore frontier, Madagascar is also putting 44 concessionson offer until May 2019, none of which has ever been tendered orexplored before. For a country without any major oil discovery to date,the ongoing license round is a wager test.

Africa’s struggling FLNG industryAfter the start of commercial operations at Golar LNG’s Hilli EpiseyoFLNG vessel in Cameroon in June 2018, hopes were high that EquatorialGuinea would soon move forward with its own Fortuna FLNG project,set to be Africa’s first deep-water FLNG development. While Fortunawas to be game changing for the gas industry of Equatorial Guineaand the rest of the continent, the development of the $2 billion projecthas stalled due to a lack of financing. And the clock has been tickingsince. The lack of progress on this plan has been so slow that operatorOphir Energy has been denied the extension of its license to operateblock R (as of January this year), which contains the giant Fortuna gasdiscovery. While Equatorial Guinea’s FLNG aspirations look moreuncertain than ever, 2019 will tell if the country can find the rightpartners to put the project back on Africa’s FLNG map.

Meanwhile, new entrants in Africa’s hydrocarbons stage are makingremarkable advances towards the development of their own FLNG

industry. On December21st last year, BP finallyannounced its FID forphase 1 of the cross-border Greater TortueAhmeyim development

between Senegal and Mauritania, which involves the installation of a2.5-Mtpa FLNG facility. It became the third African FLNG project toreach FID after Cameroon’s 2.4-Mtpa Hilli Episeyo and Mozambique’s3.4-Mtpa Coral South FLNG.

Mega projects on the moveAfrica’s come back on the global oil and gas map is not only due tothe vast natural resources found in its soil and waters, but also to thecontinent being home to mega energy projects set to transform thefuture of the industry.

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OIL SECURITY

This year will be key for the advancement of new exploration and production development projects from West to East Africa

Developments that will Shape Africa’s Energy Sector in 2019

By African Energy Chamber


Independents are leading the way in exploringand opening up new frontiers across Africa


On the upstream side, the recent inter-governmental cooperationagreement between Senegal and Mauritania, and BP’s FID on its cross-border Greater Tortue Ahmeyim development, bodes well for the futureof West Africa’s hydrocarbons industry. The project aims at extractingthe 15 Tcf of gas estimated to be held in the Tortue gas field, locatedat a depth of 2,850 meters. However, the ability of both Senegal andMauritania to work out their differences to ensure a more sustainabledevelopment of their offshore reserves and facilities around the MSGBCBasin is a factor to watch out for.

African mega gas projects are not the sole property of the continent’sWest coast, with Mozambique moving forward with two landmarkprojects putting the Southern African nation on the global LNG map.Following the launch of the Coral South FLNG project by ENI in June2017, a FID is now expected in the coming months for the Anardarko-led Mozambique LNG project, an onshore LNG developmentinitially consisting of two LNG trains totaling 12.88 Mmtpa to exportthe gas extracted from the offshore Area 1, estimated to contain awhooping 75 Tcf.

Sub-Saharan Africa’s biggest petroleum producers, Nigeria, is alsomoving forward with massive oil development projects in 2019. Lastyear already saw the launch of Total’s $3.3-billion Egina FPSO inNigeria, where production officially started in the first days of 2019and is set to peak at 200,000 bopd. FID is now expected on Shell’sBonga Southwest offshore field in Nigeria early this year, a multi-billion-dollar development whose production is expected to reach180,000 bopd.

International contenders and pretendersAs Africa strengthens its position at the center of global transformation,it is increasingly becoming the playground for international actorswilling to benefit from the continent’s vast resources.

While China has asserted its position of a contender in the continent,will new continental dynamics lead the Asian giant to change itsinvestment strategy or portfolio? With Russia’s intentions on thecontinent becoming clearer and clearer, will the first Russia-AfricaSummit this year translate into more concrete Russian deals across thecontinent? At the same time, will the US’ “Prosper Africa” initiativelaunched in December 2018 be able to counter both rising internationalcompetition and declining US influence on the continent?

A complex energydiplomacy dilemma for OPEC in AfricaWith a majority of its members made up of African nations since thejoining of the Republic of Congo in June 2018, OPEC’s evolvingrelationship with the continent as it strives to manage the global supplyglut will be requiring skillful diplomatic ingenuity.

On one side, Africa’s biggest producers and OPEC members Algeria,Libya, Nigeria, Angola and Congo-Brazzaville, are striving to boosttheir domestic output, which makes it harder and harder for theOrganization to negotiate its production cuts.

On the other side, the continent is also home to a flurry of upcomingpetroleum producers like Senegal, Kenya and Uganda, or old players

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making a comeback like South Sudan, some of them part of OPEC’sDeclaration of Cooperation, whose upcoming or increasing output addsanother layer of complexity to the formulation of OPEC’s global oilprices management strategy.

An increasing African output from OPEC and non-OPEC membercountries only complicates OPEC’s maneuver capabilities and increasesits dilemma of both providing a stable pricing environment conduciveto investments, while avoiding a worsening of the supply glut thatwould push prices further down.

Africa’s biggest petroleumproducers cast their ballotsAmong the series of elections happening in the continent this year,from Senegal to Mozambique, none will be more important for theAfrican oil sector than that of Nigeria this February. The Nigerianpresidential election is set to shape the future of the industry, not onlybecause Nigeria is Africa’s biggest oil & gas producer, but becausewhat happens in Nigeria impacts the rest of the subcontinent one wayor the other. While both Muhammadu Buhari, seeking re-election, andhis ally turned rival Atiku Abubakar have committed to the signing ofthe Nigerian Petroleum Industry Bill, the ability of the future Presidentto get his office in order and get the bill passed quickly will heavilyinfluence investments within Nigeria’s hydrocarbons sector for yearsto come.

North, Algeria and Libya are also entering an election year, with the2019 Libyan general election set for the first half of the year, andAlgeria’s for April. Both countries are on a transformation path. Libyanauthorities plan to more than double the country’s output to 2.1 millionbopd by 2021, providing politics doesn’t tamper hydrocarbonsgovernance and the work of the National Oil Company. With MuammarQaddafhi’s son Saif al-Islam Qaddafhi set to stand for election and thecountry still divided between West and East, maintaining the stabilityrequired by investors will prove challenging.

In Algeria, where a wave of reform is shaking the entire hydrocarbonssector, elections are expected to maintain a relative status-quo, at leastpolitically speaking. The country’s national oil company, Sonatrach,has launched an ambitious transformation strategy that will see itinvesting $56 billion over the next four years and internationalizing itsoperations across major global energy markets. 2019 could even seethe state-owned giant and Africa’s biggest company further expandsouth of the Sahara.

Angola’s steady road to reformsSince taking office in the summer of 2017, Angolan President JoãoLourenço has been implementing a bullish reformist agenda which is

drastically transforming the governance of the country’s oil & gassector. Angola is reforming fast, but will market forces allow changesto happen at that pace and yield the results that the government islooking for?

While international investors seem to think so, with Total and BPsigning major agreements to boost their Angolan operations over thepast few months, 2019 will tell if the international oil industry is beingconvinced of Angola’s return as a competitive African frontier or not.To showcase the work being done by Sonangol and the Angolangovernment to generate more investment in the country’s oil & gasindustry, Angola is backing up an international conference beingorganized by Africa Oil & Power in Luanda from June 4-6, 2019,where it will be launching the Angolan Marginal Field Bidding Round.This will be the first official investment roadshow organized in Angolaunder the current administration, and one that is set to unveil a newset of reforms and investment commitments.

South Sudan’s march to peaceThe major progression in South Sudan, and one on which the entireeconomy relies, is that of the peace accords. The Sudanese and SouthSudanese authorities have time and again demonstrated their commitmentto the peace process, which has remained peaceful for the most part.However, will peace deals translate into investment promises andmoney being invested into the South Sudanese economy this year?Some signals point to that direction, with South Africa’s Central EnergyFund committing $1 billion to South Sudan late last year, but marketsare still skeptics and observers will remain pragmatics and wait to seehow the peaceful transition is managed and how oil production resumesbefore making any concrete moves.

A year to improve marketaccess for East African producersWith Uganda set to join the club of African petroleum producers bythe early 2020s, efforts are on the way to develop adequate infrastructurefor the evacuation of oil that will be produced from the Lake AlbertBasin. The project seemed to be positively moving forward whenUganda and Tanzania exchanged the inter-governmental agreementfor the 1,443-km East African Crude Oil Pipeline in May 2017. However,the partners in the pipeline’s construction, French major Total, China’sCNOOC and Tullow Oil, are yet to make a final investmentdecision on the project. Meanwhile, the Host Government Agreementsare to be signed this January, but delays in concluding the pipeline’sfinancial deal have already pushed back Uganda’s oil productionambitions from 2020 to 2021. The pipeline is crucial for the furtherintegration of the East African community and to set a positive recordof joint planning, financing and implementation of landmark energyprojects in the region.


Geochemistry Evolutionetroleum geochemistry became a consolidated discipline inthe oil industry only in the 1970s, but its real boom was inthe 1980s. At that time, it was mainly focused on understanding

the origin of oil and gas and it quickly evolved through time becominga fundamental technology in exploration; biomarkers, source rockevaluation, and gas isotopes became very popular tools, largely adoptedby almost all oil companies. Later, only in the middle of the 1990s,geochemistry started to be considered as a suitable tool also for reservoirevaluation and for production optimization.

Detailed fluid and rock characterizations, obtained through differentand advanced analytical tools, started to be used to better understandreservoir heterogeneities and to support production strategies. Reservoirgeochemistry becomes more and more widespread, recognized as auseful tool in petroleum engineering.

The rapid evolution of instrumental analytical chemistry in those yearsgreatly supported the grow of reservoir geochemistry. The availabilityof high-resolution Gas Chromatography (GC) and Gas ChromatographyMass Spectrometry (GC-MS), assisted by more and more powerfulcomputers, the accessibility to many other innovative analyticalinstruments, significantly increased reservoir geochemistry reliability,making possible its diffusion and large adoption.

The further, quite recent and impressive improvements in instrumentalanalytical chemistry can be considered as a real game changer supportingan additional and even larger development of reservoir geochemistry.This last extraordinary progress in analytical instruments is due to twoconcurring factors. The first is the growing need of environmentalmonitoring, a very popular and urgent issue, determining the set-up ofcompact, portable and high performing equipment. Many instruments,developed for an efficient and distributed environmental monitoring,can be easily adapted for oil industry purposes improving sensibilityand resolution standards. The second factor is the continuousdevelopment of nanotechnologies, with spectacular consequences onanalytical capabilities. The lab on chips devices is a clear but not unique

example of this. Finally, a significant contribution to analyticalcapabilities is also coming from space exploration: one of the mostdiffused XRD equipment, used by many service companies at wellsite,was set up for mineralogical analyses on Mars.

This new generation of instruments made possible a further importantstep in reservoir geochemistry: some activities have been moved fromthe lab to wellsite. Compact and robust instruments, designed to runenvironmental analyses everywhere needed outside the labs, can beeasily installed in mudlogging units at wellsite. For the oil industry, itis a clear example of cross fertilization, technologies developed inanother industrial sector can be easily adapted to its needs andquickly adopted.

This is in short, the reason for the marriage between reservoirgeochemistry and mud logging.

Mud Logging EvolutionOn the other side, mud logging was born a long time ago, long beforegeochemistry. Originally it was a basic tool to detect hydrocarbon hintsin drilling mud: any fluorescence or gas bubbling, discovered at thesurface, was considered as a positive sign, highlighting possiblehydrocarbon presence. At the very early stage of petroleumexploration, this was one of the few tools available to detect hydrocarbonpresence in the drilled sedimentary sequence. When, many years later,in the 1960s, gas detection became quantitative and enough accurate,mud logging turned out to be a fundamental service to monitor theamount of gas entering in the hole to prevent kicks and possible blowouts due to mud density lightening. Thereafter mud logging wasconsidered as an important and essential tool for safety, but the growingaccuracy in gas detection, including quantitative distinction amongdifferent gas species in the range C1-C5, largely extended itsapplication also to reservoir evaluation. Mud logging becamethrough time a more and more widespread tool both for safety andreservoir characterization, even if for this last target, wirelinelogging, and successively LWD, has always been considered as the reference tools.

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By Mario A. ChiaramonteGeolog International

TECHNOLOGY AND SOLUTIONS

The prolific marriage of mud logging with reservoir geochemistry for a better reservoircharacterization in real-time

Geochemistry Movesto the Wellsite


Nowadays mud logging, thanks to a systematic approach includingwell calibrated and standardized devices for gas extraction at a constanttemperature, pressure and volume and to a full and reliable chemicalcharacterization of extracted hydrocarbons in the range C1-C8, iscontinuously growing and constantly gaining credibility, eroding thepredominance of wireline logs and LWD.

The Marriage of Mud Loggingwith Reservoir GeochemistryReservoir geochemistry, or more, in general, some lab activities, havebeen moved to wellsite in the mud logging units, already designed tohost analytical instruments. The logical further step was to integratethe two approaches to provide more reliable and exhaustive answersto technical issues.

An example of this is the integration of chemical analyses performedon gas extracted from mud with isotopic carbon analyses. This additionalcharacterization of gas composition can be used to get importantinformation. In the case of gas shows in the cap rock, the isotopic value

can clarify if the gas was generated in situ, if isotopic composition istypical of abiogenic gas, or if it is escaping or escaped from the reservoir,if isotopes shows an isotopic signature of a thermogenic gas, similarto that of reservoir gas. Isotopes can highlight if oil and gas in thereservoir migrated to the trap together or if they are the products oftwo different phases of source rock maturation or even if gas has adifferent origin from oil. All these pieces of information have a directimpact both on exploration, but also on field development and on theevaluation of the petroleum potential of an area.

Another example is the integration between mud gas data andgeochemical analyses on cuttings. Very recently Thermal ExtractionGas Chromatographic (TE-GC) analyses of cuttings were introducedat the wellsite. These type of analyses are a very powerful tool todiscriminate between different types of oils, providing in real timeimportant information about oil type in the reservoir. The followingfigure is a clear example of this.

At the same time, other information can be obtained about oil originby using pristane/phytane ratio. Pristane and phytane are two biomarkersthat can be easily detected by using TE-GC analyses and their ratio


A mud logging-geochemical unit operating in the USA for unconventionals

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can be used to understand oil origin and, if combined with concentrationof other molecules like C17 and C18, to give an indication about oilthermal maturity.

A similar information can be indirectly obtained also from lighthydrocarbon (C5-C8), extracted from mud and by combining thesetwo pieces of information together, uncertainties can be drasticallyreduced and the final interpretation highly improved. The light fractionof hydrocarbons is always lost in cuttings during their preparation forTE-GC analyses. By combining light hydrocarbon extracted from mudand TE-GC trace we can have a full and complete analysis ofhydrocarbon trapped in the reservoir, as shown in the following picture.

Sometimes mud contamination, mainly coming by oil base muds, canheavily interfere with both methodologies, but their integration cangreatly reduce uncertainties and avoid misinterpretations. In case ofdifferent migration phases from the same source rock at a differentlevel of thermal maturity or from different source rocks, the integrationof the two methodologies can greatly help in reconstruction of thewhole process in defining the true petroleum potential of the area.

Another example of fruitful integration between mud logging andreservoir geochemistry is given by the combination between mud gas

data and X-ray diffraction (XRD) and X-ray fluorescence data (XRF).XRD provides a mineralogical characterization of reservoir by usingcuttings, whereas XRF performs a chemical elemental characterizationof cuttings. Both these techniques have been applied at wellsite someyears ago, but nowadays dramatic improvements have been introducedby some companies, like Geolog. The combination of the twomethodologies allows a detailed zonation of the reservoir accordingto different faces based on mineral occurrence and different ratios ofelements detected by XRF, all this on the basis of well-establishedinterpretation criteria defined in the frame of chemo-stratigraphy.Combination of reservoir zonation, obtained by using XRF and XRD,and hydrocarbon occurrence by using mud logging data can be veryuseful to determine and to characterize the most favorable intervals inthe reservoir, to be easily recognized in appraisal or development wells.

The recent improvements obtained in clay mineral quantification byusing new advanced instruments and sophisticated software for XRDdata processing makes possible and fruitful the application of thisintegrated approach also in unconventionals where source rock andreservoir are the same geological object and clay minerals can beparticularly abundant.

The Way ForwardIt has been demonstrated by several field applications that the marriagebetween mud logging and reservoir geochemistry is very fruitful andcan generate a lot of added value, but the process of integration is farfrom the end and still ongoing. Many other analytical techniques canbe moved to the wellsite in the coming years and this will offer otheropportunities like those just described. Many pieces of informationwill be provided at the wellsite with lab quality in real time, allowingbetter decisions to be taken at the right time to reduce costs and toimprove integrated reservoir characterization. There will be additionalclear benefits not only for exploration, but also for field developmentand production optimization, all this by exploiting technologies developedin other industrial sectors.

TECHNOLOGY AND SOLUTIONS


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T.D. Williamson (TDW), the global pipelinesolutions provider, has commercialized a4-inch magnetic flux leakage (MFL) +deformation (DEF) + internal versus externaldiscrimination (IDOD) tool that helps ensurepipeline integrity by detecting pitting andgeneral corrosion as well as interactingfeatures such as dents with metal loss insmall diameter, low pressure pipelines.

The tool produces accura te andcomprehensive metal loss and geometry datain a single run, reducing inspection costs andtime. Its innovative design ensures the toolperforms within the optimal inspectionvelocity range, producing high-quality surveyresults with reduced flow conditions. Thetool generally requires a minimum operatingpressure of 20.7 bar (300 psi), although it is

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“In-line inspection using MFL technologyis one of the most common non-destructiveinspection methods utilized for the detectionof general and pitting corrosion in pipelines,”Barker said. “The difficulty associated withconventional 4-inch MFL designs is, tosufficiently saturate the pipe wall withmagnetic flux, the brushes must be short andthick. This creates drag that makes it more

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TDW validated the reliability of the 4-inchtool in liquid and gas, at pressures as low as13.78 bar (200 psi). “In a recent low flowliquid pipeline inspection, the TDW 4-inchMFL+DEF+IDOD performed within therecommended speed of 3.05 meters (10 feet)per second or less for 100 percent of theinspection,” Barker said. With extensiveverification testing during tool development,and more than 430.9 km (268 miles) in 31customer pipeline inspections, this tool iswell prepared to provide high quality pipelineinspection data for many pipeline conditions.

New Tool Provides Metal Loss and Geometry Datain a Single Inspection Run

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Forum Subsea Technologies is driving costefficiencies for the subsea sector with theaddition of its latest electric remotely operatedvehicle (ROV). The recently launchedXLe Spirit is the first observation-classROV to utilize Forum’s IntegratedControl Engine (ICE™) to bring greaterfunctionality commonly only found in largerwork-class vehicles.

The advanced control electronics pod fittedto all Forum XLe observation class vehiclesenables superior connectivity and expansioncapabilities when compared with otherROV’s on the market. Ethernet interfacingallows for seamless integration with otherindustry sensors using common IParchitecture and ease of remote data transfer.

Kevin Taylor VP of Subsea commented: “Asthe subsea market continues to recover froma sustained downturn, cost efficiency is highon the agenda for the industry. Forumrecognized the opportunity to apply our

leading software to a morecompact vehic le toenhance capabilities andmee t the chang ingdemands of the sector.

“By utilizing the sames y s t e m a c r o s s a l lvehicles, pilots only haveone interface to learn asthe skills are transferrablebetween the smallestobservation vehicle andthe largest trenchers. Thismeans t ra in ing canc o n c e n t r a t e o noperational tasks opposedto control systems, providing furtherefficiencies.”

The XLe Spirit incorporates a number offeatures to maximize its stability for use asa sensor platform, including regulatedpropulsion power, optimized thruster

orientation and location, accurate thrusterspeed control and a wide range of auto-functions for positioning and flying.The XLe Spirit has just completed a twelve-week test program at Forum’s test tank inKirkbymoorside, Yorkshire. It will be sentfor sea trials in the first quarter of 2019.

Forum’s New eROV Offers Big Savings for Operators

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Pepperl+Fuchs, a world leader in processautomation, has introduced an advancedBebco EPS® purge and pressurization system,designed for Class I or II/Div. 2 and Zone2/22 locations. This innovative and compactmanual or automatic system delivers allthe fea tures needed for re l iablehazardous location protection within a small,streamlined solution.

The 7500 series Ex pzc/Type Z purge andpressurization system can be fully automaticor manual and purges a common enclosureof hazardous gas or dust to maintainpositive pressure. It effectively reduces theclassification within the protected enclosureto a non-hazardous area. The 7500 carriesATEX and IECEx certifications and is ULlisted. It operates within an extremely smallfootprint of only 5.8» x 3.8» x 1.9».

“The new, compact 7500 series is easy touse, offering absolute reliability and

efficiency. When fully automated it providesexcellent enclosure protection for electricalequipment like motors, drives, control panelsand cabinets, and gas analyzers,” said KristenBarbour, Marketing Manager. “Whether youneed gas or dust protection in the oil andgas, chemical, maritime, or offshore industry– the Bebco EPS 7500 can be used in processindustries around the world for applicationsthat previously required heavier and moreexpensive explosion-proof protection.”

The 7500 Series includes intelligent automaticmonitoring and control of enclosure pressurewith dilution and continuous flowfunctionality. The system makes automaticadjustments and provides an alarm outputfor reliable protection. It is designed inmarine-grade chromate aluminum – makingit rugged enough to withstand the harshconditions of many process industries. The7500 uses universal AC/DC power and isavailable as both a panel mount and external

mount. The large touch screen enables quickand easy setup while also providing statusLEDs, a bar graph for pressure, and multipleprogram selections.

Pepperl+Fuchs Introduces the Next-GenerationPurge and Pressurization System

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Tracerco has added to its award-winningrange of advanced nucleonic instrumentationby announcing the launch of Hyperion™.Designed using innovative scintillator-basedtechnology, Hyperion™ is a non-contact, nomoving parts measurement solution thatprovides accurate and extremely reliable bulklevel and density measurements. This enablescustomers in the oil, gas, petrochemical,refining and mining industries to solve theirmost challenging process measurement andcontrol problems.

Externally mounted, eliminating possibleleak paths, this extremely robust solution isnot affected by adverse process conditionssuch as high pressures, extreme temperatures,

fouling or corrosive fluids. Hyperion™ alsocomes with unrivalled stability andautomatically compensates for the effects ofambient temperature changes, allowing forsustained accuracy and virtually no age-related drift in its measurements.

Housed in 316L stainless steel as a standard,Hyperion™ is highly ruggedized, ensuringthat vibrations or dust settling has no impacton its operation. Internal sealing alsosafeguards the condition of Hyperion™, evenin the event of water ingress.

With an enhanced self-diagnostics capabilityand built in condition monitoring, Hyperioncan monitor health status and relative

humidity, predict component failures, andprovide an end of life estimation. This allowsoperators to diagnose why errors in themeasurement may be occurring, providinga proactive and cost-effective approach tothe planning of any maintenance onequipment.

Graham Barker, Market Manager at Tracercostated: “The capability to visualize andaccurately control process conditions insidea vessel is extremely important for operators.By obtaining accurate and repeatable leveland density measurements with Hyperion™,operators can maximize product throughput,adhere to environmental regulations, inaddition to being assured that they are runningthe most efficient and cost effective operatingconditions to optimize their processes.”

Hyperion™ is Tracerco’s latest addition toits nucleonic instrumentation portfolio andwill provide major production, safety andenvironmental benefits to its customers acrossthe globe.

Tracerco Launches Hyperion forBulk Level and Density Measurements

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here were a number of ‘hot’ talking points over 2018 for theglobal oil industry as well as those specific to the African oil& gas scene. In Africa, specifically, “regional hub” and “African

cooperation” dotted the headlines regularly.

Only a decade ago, African resource holders were fiercely competitive,and cooperation was merely a talking point for government/developmentagencies and conference delegates. The status quo has definitelychanged. While these same countries are still competitive, it is in amuch more constructive manner. Looking out for their own interestsis paramount, but now, so is looking out for the interests of theirAfrican neighbors.

A prime example can be seen with Equatorial Guinea in its naturalgas pursuits. Minister of Mines and Hydrocarbons, Gabriel MbagaObiang Lima of Equatorial Guinea, said in April, “It is imperative thatAfrican nations monetize their gas, and that energy users benefit fromthis cheaper, cleaner, locally produced resource. Equatorial Guinea iscommitted to working with its neighbors in the region to find solutionsthat bring benefit to us all.”

Equatorial Guinea of course wants to profit but would rather see itsgas go to African nations, benefitting its own economy, while alsohelping bring down costs for those neighbors that rely on expensiveimports. The country will supply gas to Togo under its LNG2Africa initiative, in which Equatorial Guinea is promoting theutilization of LNG within Africa, using gas sourced and processed inAfrica. Togo will study the import, regasification of LNG, and its usefor power generation.

Another example is the new agreement between Nigeria and its NorthAfrican counterpart Morocco, with their planned Nigeria-MoroccoGas Pipeline (NMGP). This plan has moved from conception to FEEDstudy over a short time with the first phase of the FEED expected tobe complete by the end of Q1. The FEED signals the implementationof the cooperation agreement signed in Rabat, by leaders of bothcountries last year. The NMGP is designed to be 5,660 km long, willreduce gas flaring in Nigeria and encourage diversification of energyresources in the country. Both countries expect to complete the projectin phases over a period of 25 years.

Another pipeline development to serve the region also emerged recently.The West African Gas Pipeline (WAGP), will see an extension from

its source in Nigeria. The existing pipeline currently sends gas fromNigeria to Togo, Benin and Ghana through a 678-km network. NNPCchief, Maikanti Baru, said the extended gas pipeline will traverse atleast 15 West African countries and connect to an existing Europeangas pipeline. According to Baru, the feasibility study of the gas pipelinehas been concluded and the pre-FID (final investment decision) anda greenfield optimization study is currently ongoing.

Egypt, with its own considerable natural gas resources and strategiclocation near gas discoveries in Cyprus and Israel, and access to exportmarkets, is a natural choice in becoming a regional hub for gasprocessing. Already having the natural gas infrastructure, includingpipelines, petrochemical and LNG plants, Egypt is looking to turn thiscapacity into a money-making proposition while also helping itsMediterranean neighbors.

One project under this objective is a pipeline from Israel to Egypt.Overseas Private Investment Corporation (OPIC), the institution thatfunds projects led by US firms in developing countries, said it willprovide funding for the pipeline. The project will transport natural gasfrom Noble Energy’s gas fields offshore Israel to Egypt.

Further, over the past several months Noble Energy executed multipleagreements to support delivery of natural gas from the Leviathan andTamar fields, into Egypt. This helps Egypt in its ambitions to becomea regional energy hub, providing access to both growing domesticmarkets and existing LNG export facilities. The EMG Pipeline,approximately 90-km, located primarily offshore, will connect theIsrael pipeline network from Ashkelon to the Egyptian pipeline networknear El Arish.

In addition, another agreement supporting Egypt’s regional hub goalswill see it bring in gas from Cyprus for processing. A pipeline fromthe Cyprus’ Aphrodite discovery area to Egypt is being proposed. Underthe terms of this agreement, gas offshore Cyprus could also be usedfor Egypt’s domestic needs.

With Egypt’s own growing resource base and the deals that will seethe country bring in gas for processing, there is potential for this gasto be exported to other countries, and also for associated processinginto petrochemicals for both domestic and export markets.

Bilateral cooperation can also be noted to the south of Egypt. Thegovernment of South Sudan has strengthened itsrelationship with African countries through a numberof cooperation agreements and new engagement inthe oil industry, including with its northern neighborSudan. A November agreement between the pair willsee South Sudanese engineers sent to Sudan to betrained in oil exploration and mining. Sudan, formerly

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REGIONAL COOPERATIONREGIONAL COOPERATION

The NMGP is designed to be 5,660 km long,will reduce gas flaring in Nigeria and encourage

diversification of energy resources in the country.

the foe of South Sudan, played a prominent role in supporting therelatively recent South Sudan peace agreement.

Furthermore, South Sudan has reached out to a number of its Africancounterparts for cooperation in the oil and gas sector, including EquatorialGuinea, South Africa, Uganda and Nigeria. In November, South Sudansigned a deal that will see South Africa invest $1 billion in the country’spetroleum industry. According to South Sudan’s Minister of Oil, EzekielLol Gatkuoth, the investment will go into building a refinery andpipelines as well as oil exploration. A portion will also be geared towardbuilding local capacities, including the training of workers and engineers.As early as 2017, South Sudan began its cooperation with EquatorialGuinea, signing an MoU that set out the terms for a strong bilateralrelationship between the African oil and gas producers. Under thepartnership, an exchange of information on policy and regulation;promoting upstream, downstream and infrastructure projects; andcollaboration between the national oil companies Nilepet and GEPetrolwas to be seen. South Sudan and Nigeria also recently signed a multi-sector cooperation agreement which included oil and gas activities.

The East African nations of Tanzania and Uganda are striving to buildup their respective petroleum sectors and to that end, have initiated a

number of cooperationdeals. One of the mostnotable is the EastAfrican Crude OilPipeline (EACOP) thatwill transport Ugandancrude oil from the Hoimadistrict to the Tanzanianpor t a t Tanga. InSeptember 2017, thepresidents of both nations laid the foundation stone for the expected1,445-km pipeline.

Mozambique, with its massive natural gas reserves, is looking to notonly build an export LNG terminal, but to also divert larger quantitiesto South Africa. The two countries have discussed the building of apipeline that could potentially supply regasification terminals that areon South Africa’s drawing board.

Further to these examples, there are plenty moreto be seen. Going back a decade the buzzwordwas African solutions, now it seems that thisconcept has become reality and its results willbecome increasingly apparent moving in to thenext decade. Be sure to catch each issue of

Petroleum Africa to keep up to date on the developments resultingfrom this newly invigorated spirit of cooperation.


South Sudan signed a deal that will see South Africainvest $1 billion in the country’s petroleum industry.


ullow has a rich heritage of discovering significant oil resourcesin East Africa. The group first started exploring in Ugandain 2006, successfully opening the Lake Albert Rift Basin,

which has discovered resources of some 1.7 billion barrels of oil.Tullow has taken its knowledge and understanding of the geology inUganda across into neighboring Kenya. Since 2012, Tullow’s successfulexploration and appraisal drilling campaigns in Kenya have resultedin the opening of a second new tertiary rift play in the SouthLokichar Basin.

It all began in Kenya in 2010, after signing agreements with Africa Oiland Centric Energy to gain a 50% operated interest in five onshorelicenses. In 2012, Tullow farmed in to onshore Block 12B with 50%and increased its interest in Block 12A to 65%.

The Ngamia-1 exploration well in Kenya marked the start of a significantprogram of drilling activities across the acreage. The Ngamia-1 well,in 2012, successfully encountered over 200 meters of net oil pay, thesecond East Africa onshore tertiary rift basin opened by Tullow. Thishas since been followed by further exploration success in the SouthLokichar Basin at the Amosing, Twiga, Etuko, Ekales-1, Agete, Ewoi,Ekunyuk, Etom, Erut and Emekuya oil accumulations.

Safety is crucial in the oil and gas sector and the safety of oil and gasworkers is paramount. It is not just protecting workers during catastrophicincidents but managing their day to day needs. When operating inregions such as Africa, this healthcare provision is made more difficultby the often remote and inhospitable regions.

Partnership ApproachFor its operations in Kenya, Tullow turned to Remote MedicalInternational (RMI) to provide comprehensive medical services. Theoperations are primarily in northwest Kenya, an area with complexgeographical, political, and environmental challenges in addition tothe usual complexities of industrial work in remote locations. RemoteMedical and Tullow have been successful in addressing these challenges,greatly improving the on-project health, and making a positive impacton the local communities. This has been achieved through a collaborativepartnership, location-specific planning, innovative solutions to problems,and localization programs.

“We provide healthcare to various organisations, operating companies,governments, non-profits and the UN when they need health care for

their workers in remote and challenging places around the world,”Wayne Wager, CEO Remote Medical International, says. “We providemedical care, we provide medics that go to these remote andchallenging places and take care of the workers for commercialcompanies, including soldiers seconded to the UN and so forth, andall the associated services in connection with providing that medicalcare, such as equipment and supplies.”

Local InvolvementFrom the outset, RMI were aware that this project would be extremelydynamic, both because of the inherent challenges and the capriciousnature of early stage oil and gas production. It was decided that in suchan unpredictable scenario close contact was essential, so RMI optedto headquarter operations in the same office complex in Nairobi withTullow. With operations co-located, communication was efficient, andimplementation proceeded according to plans. Tullow provided 14 keydeliverables to achieve within 90 days of award, all of which were hit.

RMI gets its staff from two places. “First, we have very high standardsfor our medical practitioners,” Wager explains. “We put them througha very strict online test that they must pass. Once they’ve passed, they

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A partnership between Remote Medical International and Tullow Oil is ensuringthat the healthcare needs of its workforce are met on its Kenyan operations

Partnership Approach ProvesCrucial in Remote Healthcare

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go through an interview process with our medics and our Chief MedicalOfficer so that we’re very confident in the people that we send out.Those people are very competent in the field and also have resourcesback at base. A very competent medic in the field is just onephone call away from our Global Communication Center. They cancall and get advice immediately from other medics and our medicalstaff. We also support them with equipment and supplies that are veryhigh quality.

“They’re working with the best equipment and have the bestpharmaceuticals available to them, all within the country constraints.As you know, the way medicine is practiced on a work site in a remotearea is much different than somebody showing up in an urban ERsetting. One of the other resources that our medics have is telemedicineso that they can send physiological signals, blood pressure heart rate,ECG and video to our medics at the communications center. We havea very, very comprehensive backup for our medics in theseremote places.”

Part of Tullow’s sustainability culture is to encourage local employment.Due to the capital and technology intensive nature of the industry, onlya relatively small number of highly technical and specialized personnelare needed by operations. They also operate in countries where the oilindustry is new and just developing and so the skills and expertise ofthe national workforce can be limited or still emerging.

However, they have a commitment to hiring locally and have set internaltargets for increasing the proportion of staff represented by the nationalsof the host countries. There are also employment opportunities in thesupply chain, particularly in onshore operations. “We try to maximizethese by requiring our international suppliers to employ and sourcegoods and services locally, as part of their contract with us,” theirpolicy states. “We also work closely with our host governments toensure that their expectations around skills localization are balancedwith operational and labor market realities.”

For their part, RMI undertakes rigorous screening of medical personnelto ensure project success, which is essential on a project like this one.At the height of the project RMI employed 52 people in support ofTullow, each thoroughly vetted in a multi-step process. Of those, over65% were local workers – including doctors, clinical officers, ambulancedrivers, and administrative staff. This met both Tullow’s and RMI’ssocial responsibility goals.

One standout achievement came with the ambulance driver positions.RMI created a custom training and mentorship program in partnershipwith the Kenya Council of EMTs. This program provided EMTcertifications that met international standards–a first in Kenya. Withintwo years of starting the project, the percentage of Kenyan nationalshad increased to 85%.

Stay or GoA close relationship with RMI’s in-country evacuation partner, Amref,and partner hospital Aga Khan University Hospital in Nairobi wasestablished for efficient medical evacuations when needed althoughWager was keen to point out that evacuation is a last resort.

“It’s like the cavalry coming over the hill,” Wager says of emergencymedical evacuations. “It’s very exciting and when people talk aboutour role they talk about the evacuations, but in fact, I’m speaking forRMI, our medical team are taught to minimise the drama and minimizethe complexity of the healthcare. I emphasize very, very strongly,without sacrificing any quality of outcomes. We monitor that verycarefully with an electronic medical record system, which are reviewedby medical doctors.

“Our quality of care is very high, but one of the things that I think hasbeen abused in the industry, is at the drop of a hat, workers areevacuated and the quality of care they get is not necessarily better. Wefind that doing less is more so monitoring the workers, the patient,very closely with our staff on site is often the best option. They endup doing a lot better than had they been evacuated. Evacuations are,again, very glamorous, sounds cool, but it is not necessarily the bestthing for the worker.”

Reduced RecordablesThis comprehensive approach to care, combined with a deep andcommitted partnership from Tullow, allowed the two companies toachieve a remarkable 86% reduction in TRIR over the course of thisproject. “Remote Medical International is a customer-oriented servicecompany with innovative IT solutions to medical issues such as securecloud-based patient notes,” Gordon Scott, EHS operations manager,Tullow Kenya, says. “They have very good training capabilities andmedical support to a large project in a very challenging area. A veryresponsive company with an excellent project manager who maintainsvery close contact to respond quickly and efficiently. They have achievedexcellent results in training and up-skilling the local community, workforce and medical providers.”



he ongoing investment in refining, petrochemicals, fertilizerand gas is driven by the desire to bring innovation and efficiencyinto all aspects of Nigeria’s oil and gas sector, the Dangote

Group President and Chief Executive, Aliko Dangote, has said.

Dangote, who made this disclosure at the Nigeria International PetroleumSummit in Abuja held in late January, said the company is committedto the concept of energy efficiency and innovation in the oil and gassector.

The business mogul, whose 650,000 barrel per day capacity refineryis the largest in Africa, was represented by the Group Executive Director,Government and Strategic Relations, Dangote Industries Limited, Engr.Ahmed Mansur.

Addressing participants at the forum, Mansur said the theme of theconference, “Shaping the Future through Efficiency and Innovation”,was quite apt given Nigeria’s quest for economic transformation.

According to him, Aliko Dangote is passionate about efficiency andinnovation in the oil & gas sector through adding value to thehydrocarbon process.

Mansur said the company’s passion and drive is seen in the buildingof the project, which will become the world’s largest single train refineryon completion and therefore a boost to Nigeria’s economy.

He stated: “The refinery can meet 100% of the domestic requirementof all liquid petroleum products (Gasoline, Diesel, Kerosene andAviation Jet), leaving the surplus for export.

“This high volume of PMS output from the Dangote Refinery willtransform Nigeria from a petrol import-dependent country to an exporterof refined petroleum products. The refinery is designed to accommodatemultiple grades of domestic and foreign crude and process these intohigh-quality gasoline, diesel, kerosene, and aviation fuels that meetEuro V emissions specifications, plus polypropylene,” he said.

Mansur disclosed that Dangote is also constructing the largest fertilizerplant in West Africa with capacity to produce 3.0 million tons of Ureaper year as part of the gigantic economic transformation project. Heexplained that the Dangote Fertilizer complex consists of Ammoniaand Urea plants with associated facilities and infrastructure.

“Nigeria will be able to save $0.5 billion from import substitution andprovide $0.4 billion from exports of products from the fertilizer plant.Thus, supply of fertilizer from the plant, which is set for commissioningbefore the second quarter of 2019, will be enough for the Nigerianmarket and neighboring countries,” he added.

Speaking further, he said at a time when the oil and gas industry andthe global economy is in a state of flux, it is most appropriatethat attention should be given to the future especially given theincredible speed and quantum of change taking place in every facet ofhuman endeavor.

“Our economy in particular cannot afford to ignore these massivechanges. Our decades of dependence on this industry for oureconomic well-being and the urgent need for diversification has beenwidely recognized and is clearly the most critical challenge for ourpolicy makers.

“But even as we seek to diversity from oil, and we are, indeed, makingobservable progress in this regard, we cannot ignore theneed to continue to exploit these God-given resources ina more efficient and innovative manner,” he added.

He commended the Management of the Nigerian NationalPetroleum Corporation (NNPC) for its unwavering supportin Dangote’s quest to make Nigeria self-sufficient in theproduction of petroleum products.

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Investment in Refinery, Petrochemicalsis Driven by Innovation and EfficiencyInvestment in Refinery, Petrochemicalsis Driven by Innovation and Efficiency

Dangote is constructing the largest fertilizer Plant in West Africa with the capacity to produce3.0 million tons of Urea per year as part of the gigantic economic transformation project

L-R: Minister of State for Petroleum Resources, Dr. Ibe Kachikwu; Group ExecutiveDirector, Government and Strategic Relations, Dangote Industries Ltd., Engr. Mansur

Ahmed and the Group Managing Director NNPC, Engr. Maikanti Baru

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This high volume of PMS output from theDangote Refinery will transform Nigeria

from a petrol import-dependent country to anexporter of refined petroleum products.


ANGOLAThe Grace Period is Over for João Lourenço

oão Lourenço has been president of Angola since September26, 2017. About one year later, he cemented his hold on powerby taking over the chairmanship of the ruling Movimento Popular

de Libertação de Angola (MPLA). Although he reshuffled thegovernment, for instance by replacing the transport minister, and thevice-president, Manuel Vicente, most other ministerial posts had notchanged from the previous administration.

Despite promises to diversify the economy and fight corruption, whichhe has described as a scourge on society, his actions so far appearcontradictory to his publicly-voiced intentions and declarations pastand present.

Lourenço inherited a dire economic situation, characterized by seriousshortages of foreign currency, particularly of the US dollar, and thecontinual devaluation of the kwanza. The currency depreciated 40%against the greenback in 2018. In addition, inflation has hovered around30% and is set to rise.

Angola’s economic troubles began in 2014 when global crude oil pricesdipped and severely hampered the government’s ability to generaterevenue. Angola depends on oil for 75% of its government revenueand 90% of its exports. This over-dependency on the hydrocarbonsector left the country vulnerable to economic shocks, potentiallyplacing the country into an irrecoverable position.

Diversification has longbeen the answer, butexecution of a strategya n d p l a n n e v e rmater ial ized in theprevious administration.Lourenço’s chief electionc a m p a i g n p l a n kcentered on reducing thedependency on Angola’shydrocarbons sector and

creating new revenue streams fromexisting resources or developing newones. Diversification was also a keycondition for the International MonetaryFund (IMF) to agree to a three-yearextended fund facility for Angola worth$3.7 billion which the creditor announcedon December 7, 2018; $990 million wouldbe immediately disbursed. Endingcorruption, including bribery and money-laundering was another condition.

Diversification: An Urgent PriorityAngola is in ‘desperate’ need of cash, and therefore Lourenço is pursuingan ambitious investment program to develop the country’s agricultural,tourism, and mining assets. For instance, the government isplanning to invest $230 million across the country over the next sixyears to support its Proyecto de Desarrollo de AgriculturaComercial, a development initiative launched last December whichaims to commercialize the agricultural sector. Over $77 million hadalready been invested in such projects countrywide at the endof 2018.

Oil majors, such as the UK’s BP, France’s Total and US oil giantExxonMobil have also signed memoranda of understanding

with the state-owned oilcompany, Sonangol, todevelop new ultra-deepoffshore oil operations.However, the amount of theinvestments has not yet beenmade public.

A lot of the money for thenew investments appearsguaranteed by the government.Against the backdrop of a poor

OPINIONBy Miguel Sanz

Angola’s economic troubles began in 2014 when global crude oil prices dipped and severely hamperedthe government’s ability to generate revenue

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João Lourenço

If Lourenço is serious about eradicatingcorruption, he should be careful with who

he deals with and how this may look to the outside.So far, his defense scorecard, his lavish spending,support for Vicente and family appointments canonly undermine his credibility.

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economic outlook, coupled with crude oil prices below the levels thegovernment had counted on – although Brent crude prices reboundedearly this year off the back of a production cut agreed by OPEC memberstates – Angola will have to resort to more borrowing. Thanks toreprofiling of its debt throughthe issuing of $5 billion-worth of euro-and dollar-denominated bonds, likelyexplains the reduced fiscaldeficit, as maturities havebeen extended in themedium-term. However,debt-to-GDP remained at arisky 90% at the end of 2018,m e a n i n g t h a t m o r ecommercial loans will be needed to finance the ambitious investmentprogram and will continue to damage economic growth prospects, notleast because China is Angola’s largest purchaser of oil.

Meanwhile, Angola already owes Beijing a lot of money. Officialfigures put this at $23 billion last year, but due to the lack of reliabledata this number could be much higher. Furthermore, as a lot of thatdebt with China has been guaranteed through oil-swap deals, increasedvolatility in crude oil prices is likely to again create more financialheadaches for the government. Foreign investors are also likely to beconcerned, as a growing debt burden will hinder the government’sability to honor its debt repayments and ability to unlock financialresources, for instance to pay for projects or salaries to its civil servants.

Anti-corruptionLourenço also pledged to stamp out corruption, which he has describedas a ‘scourge on society’. International observers were positivelysurprised when he sacked the children of ex-president dos Santos fromkey positions within the state-owned oil company, Sonangol, andAngola’s sovereign-wealth fund, FSDEA. José Filomeno, a son of theformer president and former head of FSDEA, and his business ally,dual Swiss-Angolan national Jean-Claude Bastos de Morais, werearrested in Angola in September 2018 on charges they had conspiredto defraud the state in multiple jurisdictions, including in Switzerlandand the United Kingdom. Both have denied wrongdoing. Authoritiesin Mauritius, Switzerland and the UK froze their assets, whileinvestigations were ongoing. However, London’s Commercial Court,which is part of its High Court, lifted the freezing order due to whatit said were serious procedural failings in the original complaint.

Notwithstanding, and based on a recognition that corruption wasconducted with impunity under the previous administration, Lourenço’sgovernment in May last year adopted an amnesty bill for the voluntaryrepatriation of stolen state funds that had been moved offshore. Thetrue extent of Angola’s corruption problem is unclear, but authoritiesboth in Angola and the US have indicated that close to $30 billion inillicitly obtained money from the state is being held in offshore accounts.But the amnesty bill, which expired in December, appears to haveattracted little interest according to legal practitioners on the ground,and few actually repatriated any money. The government has promisedto now coercively go after those who have stolen public funds andhidden it abroad.

Angola’s ability to do this remains in doubt. Repatriation of financialassets will also depend on the willingness of banks abroad to transferback the money. Tightening anti-money-laundering legislation acrossthe world, will make commercial banks – especially those in OECD

countries – more averse tohigh-risk jurisdictions likeAngola, diminishing theeffectiveness of the law.Since ‘de-risking’ of Angola’sbanking sector took placeaf ter the col lapse ofPortugal’s Banco EspiritoSanto – in part due to toxiccredi t a t i ts Angolansubsidiary – hardly any

Western banks have resumed correspondent banking relationships fortransacting in US dollars, which explains a lot of Angola’s currentproblems. But because oil-dependent Angola’s financial sector is highlydollarized, such correspondent banking is also key to repatriate thestolen funds, placing doubt about the likely success of Lourenço’spolicies. His advisors should be aware of that.

Restoring trust depends on the government’s ability to reform thefinancial sector, which remains concentrated around a few politicallyexposed persons among Angolan banks’ shareholders; of the 27commercial banks registered with Banco Nacional de Angola – thecentral bank and sector regulator – five control over 80 percent oftotal banking assets, deposits and loans. In addition, the banking sectoris highly centralized with the vast majority of Angolans and small- andmedium-sized enterprises unable to access formal credit. Instead, thebulk of credit given by Angolan banks goes to a few hundred choseninvestors. Given that diversification is a priority of the Lourençopresidency, his ability to also restructure the financial sector willbe critical.

From Reformist to a Return to Old HabitsThe government’s new policies have indeed caught many mediaheadlines, but Lourenço’s own behavior during his first year in officealso contradict his narrative. It started with lavish spending during astate visit to Europe, where the Angolan delegation signed severalagricultural development projects with French financiers, amongothers. According to reports on the Maka Angola news website, theAngolan delegation went on a spending spree, chartering at leastthree aircraft, including a Boeing 787 VIP private airliner, a Boeing737 and a Gulfstream business jet. According to the leasingcompany, the Boeing 787 cost $74,000 an hour to charter. Itgoes without saying, that this sort of spending does not marrywell with Lourenço’s promises, and his narrative of being amodest person.

Others have pointed to the Lourenço family’s real-estate property inthe town of Bethesda, Maryland, United States. A report by USnewspaper The Washington Post citing public records said the propertywas purchased in 2013 for $1.7 million by the Lourenço family. Whileit is not illegal for Angolans to own property abroad as a primaryresidence, such revelations will probably fuel suspicions about thepresident’s true intentions.


The true extent of Angola’s corruptionproblem is unclear, but authorities both in

Angola and the US have indicated that close to $30billion in illicitly obtained money from the state isbeing held in offshore accounts.

OPINION www.petroleumafrica.com

More questions emerge over Lourenço’s positioning vis-à-vis the formervice-president, Manuel Vicente, who Portuguese prosecutors in 2017charged with bribing that country’s attorney-general in 2011. Lourençorefused to recognize the Portuguese authorities’ competency to tryVicente and lambasted the charges as ‘interference’ by the formercolonial power. It was agreed that Vicente would be tried in Angolainstead. This never occurred. Although Vicente has been sidelined fromthe MPLA leadership, he remains an influential businessman in bothAngola and abroad.

Another worrying trend is potential nepotism and conflicts of interest,including within the military. In April 2018, the president promotedhis brother – General Sequeira João Lourenço – as deputy head of thePresident’s Intelligence Bureau, which oversees the military, the policeand the intelligence services. Two months prior he allegedly sold astate-owned aircraft to his brother’s aviation company – SJL Aeronáutica– without a public tender and at an undisclosed price.

It does not end there. His plans to expand the military budget shouldsound some alarm bells. While already having among the largestmilitary budgets on the continent, Lourenço is intent on expanding itfurther. One reason raised has been to fight piracy, as Angola is lookingto expand its offshore oil production operations and modernizing itsnaval capabilities would ensure security of such operations againstsuch threats; this is despite Angola suffering hardly any such attacksin its waters over the past few years. Although official figures indicatethat Angola’s military budget halved between 2014 and 2017, well-respected Sweden-based think tank Sipri has noted that estimates ofreal military spending are hard to come by across Sub-Saharan Africa.Despite the decline, in September 2016 Middle East-based PrivinvestGroup announced on its website that it would provide naval vessels tothe Angolan navy and construct a ship-building facility together witha London-based partner.

Around that same time it was revealed that Privinvest had signedcontracts to supply ships to Mozambique which were never delivered.The deal, along with two others left Mozambique with a massive billof $2.1 billion – more than its total national debt at the time. OnDecember 29, South African police arrested Manuel Chang,Mozambique’s finance minister, when the deals with Privinvest weresigned, on suspicion of fraud relating to the deal. This followed anindictment by the US district court of New York City, which led to thearrest of Jean Boustani, an executive of Privinvest. Three former bankers

of Swiss bank Credit Suisse, and a dozen more have also been indictedfor their role in the scheme.

While Privinvest was not the only company involved with inflatingMozambique’s debt to astronomical levels, the company has facedresistance in other jurisdictions, such as Nigeria. Paris-based The AfricaReport revealed in June 2018 that the Nigerian finance minister in 2014had refused to accept a $2 billion investment proposal from Privinvestafter it appeared clear that Nigeria would have to provide most of theguarantees for the loans that would finance the joint venture; Privinvesthad reportedly proposed to take control over a derelict shipyard fromthe Nigerian navy and refurbish it. That Angola has signed a deal withPrivinest under Lourenço’s watch – granted he was defense ministerat the time – may therefore also concern investors, especially since thegovernment never confirmed the investment. Furthermore, in May2018, Credit Suisse announced a $700 million loan to Angola.

Conclusion: Napoleon WalksIf Lourenço is serious about eradicating corruption, he should be carefulwith who he deals with and how this may look to the outside. So far,his defense scorecard, his lavish spending, support for Vicente andfamily appointments can only undermine his credibility. That the highestranks of the MPLA and the broader governing elite in Angola remainintact, bar a few cosmetic changes to the Political Bureau – the apexgoverning body of the MPLA – is also worrying.

Adopting policies that, indeed, are likely conditions imposed byinternational financiers such as the IMF but that in reality are unlikelyto produce any change in behaviors not only puts his own track-recordat risk, but also the reputation of the entire country. Furthermore, thelack of criminal convictions of former senior officials – not only of theformer president’s family, but also other high-ranking MPLA cadres– suggests that their behavior will not change. Either the authoritiesare deliberately delaying the processes to get some initial goodwillfrom foreign investors, or the system is so slow that no conviction willserve to deter future corrupt behavior. The end result is that foreigninvestors and financiers engaging in Angola are setting themselves upto considerable compliance and legal risks. Giving the ‘new’ presidentthe benefit of the doubt may have been valid in his first year, but thelack of progress should prompt them to adopt a more cautious approach.Just as Napoleon in George Orwell’s Animal Farm promised a wholenew way of governing, once in power he quickly adopted the samehabits as his former steward.

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nown for its pyramids and ancient civilization, the Land ofthe Pharaohs, Egypt, has played a central role in the politicsof the greater Middle East over modern times. The country

is the most populous Arab nation, with an estimated 90 million citizensand growing.

Egypt’s political arena is a complicated issue to say the least, althoughsince General Abdul Fattah el Sisi took control from the MuslimBrotherhood several years ago through a ‘bloodless coup,’ a modicumof calm has been seen. The country is still a bubbling cauldron of unrestin some areas, however. The political issues and anxieties over thefuture have generated ongoing protests, labor strikes, mistrust betweenIslamist and secular parties, and Muslim-Christian tensions in someparts of the country. Despite these issues, Egypt is still a prime destinationfor investment and one of the safest countries in the region.

The country hosted presidential elections over three days in March2018. President el-Sisi, faced off against relative political unknownMoussa Mostafa Moussa. The election was little more than a formality

extending el-Sisi’s presidential mandate another five years. Numerouscandidates were at one time in the race, including former PrimeMinister Ahmed Shawfik, who ran against Muslim Brotherhoodcandidate Mohamed Morsi in the 2012 election. Leading up tothe 2018 elections, it has been widely reported that othercandidates were intimidated and strong armed into withdrawingfrom the race.

This year the country is expected to host “local” elections in Q4; ifthey take place, they will be the first in a decade. The local electionshave been witnessing a significant delay after municipal councils weredissolved eight years ago. Recently, the local administration law,whichhas not yet been sent to the president for approval, is stated to be thereason behind the delay. Elections were supposed to be held in March2016 but were rescheduled repeatedly. Parliamentary spokesman SalahHassaballah told reporters in April 2018 that the local elections wouldbe held during H1 2019 after the local administrative draft law is passedby the Parliament; however, other officials have tagged elections totake place closer to the end of 2019.

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By Jennifer Nickle, Deputy Editor

AFRICAN FOCUS

President: President Abdelfattah El Sisi (since June 2014)Independence: February 1922 (from UK protectorate status)Population: 99,413,317(July 2018 est.)GDP (purchasing power parity): $1.204 trillion (2018 est.)GDP - real growth rate: 4.4% (2018 est.)GDP - per capita (PPP): $12,700 (2018 est.)Director General of Energy: Tarek El Molla

Oil - production: 640,000 bpd (October 2018)Oil - consumption: 878,000 bpd (2016 est.)Oil - proved reserves: 4.4 billion barrels (January 2018 est)Natural gas - production: 50.86 Bcm/d (2017)Natural gas –consumption: 57.71 Bcm/d (2017)Natural gas - proved reserves: 2.186 trillion cubic meters

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Egypt has been struggling economically for much of the last decade,although 2018 was much better than in previous years and is expectedto improve even more in the coming year. The improvement in theeconomy can be partly attributed to the recovery in domestic demand,particularly private consumption. This is forecast to sustain Egypt’seconomic growth at 5.2% in 2019, according to the United NationsWorld Economic Situation and Prospects (WESP) 2019 report.

While the WESP report notes that external demand that drove theEgypt economy’s growth rate in 2018, is forecast to stay mostlyfavorable, it also warns that structural vulnerabilities, including weakfiscal and balance ofpayment positions, areprojected to weigh ongrowth prospects.

The reforms that thegovernment beganinstituting in 2014 setthe stage for balancedand inclusive growth.Its bold reform programwas aimed at spurringthe economy and enhancing the country’s business environment. Egypt’sfirst wave of reforms were focused on rebalancing the macro economy,including passage of the VAT Law, reducing energy subsides, containingthe wage bill, and the liberalization of the Egyptian pound. The secondwave of reforms focused on improved governance and the investmentclimate, including the Civil Service Reform Law passed in October2016 and policies to remove investment barriers and attract local andforeign investments.

These reforms along with the gradual restoration of confidence andstability began to yield positive results. In fiscal year (FY) 2018, realGDP grew at 5.3%, compared to 4.2% in FY 17. The economic pickupis driven by public investments, private consumption, and exports ofgoods and services (such as oil and tourism); and dynamism is seenin the tourism, gas, ICT/telecom and construction sectors. Accordingto the World Bank, Egypt’s inflation continued to ease, despite upwardpressure from decreased subsidies and subsequent increases in energycosts and transport fares. Headline inflation slowed to an annual 13.5%in July 2018 from a record high of 33% a year ago. Similarly, coreinflation fell to single digits for the first time in more than two years.

Foreign exchange reservescontinued to improve andreached $44.3 billion atend-July 2018.

The government hasscaled up key socialprotection short-termmitigating measures,including through higherallocations of food smartcards and ta rge ted

conditional and unconditional cash transfer programs to alleviate theadverse effects of the economic reforms on the poor and vulnerable.The measures were also aimed at increasing investments in the country’shuman capital. To effectively integrate human development in thesocial protection measures, the conditionality of the cash transferprograms is related to health and education. The country’s socialprotection measures are shifting from generalized energy and foodsubsidies to more poverty and human development targeted programs.

The Upstream Industry

Egypt has one of the busiest petroleum sectors on the continent, withboth oil and natural gas playing key roles in the country’s economicand infrastructure development. The past year has been no differentwith Egypt once again garnering its fair share of attention and activity,and then some.

In H2 2018 the government began working on a new model for futureoil and natural gas production contracts in undeveloped areas to spurexploration and help the country become self-sufficient in energy. Thenew system would largely have companies bearing the cost ofexploration and production in return for a share of the output, and thenbe free to sell to whomever they wish. The production share woulddiffer from concession to concession, depending on the investment.The current PSAs entitle companies to roughly one-third of the project’soutput to help cover exploration and production costs. The remainingoutput is split between the company and the government, which thenhas the right to buy the producer’s entire share at predeterminedprices. Under the new system the government would not have tostruggle to pay for production diverted to the local market. The newcontracts would enable investors to use their full share of productionas they see fit, without having to sell it to the government at apreset price, so long as they pay all exploration and production costs.This new investment system, if it becomes law, could be applied to

future agreements in undeveloped frontier areas; existing contractswould not be affected.

The country is home to a host of exploration firms, major and independentalike. Companies like ENI, BP, Apache Corp, TransGlobe Energy anda long list of others work at what seems to be breakneck pace to keepEgypt’s oil and natural gas production totals on an even keel. Over thepast year this activity helped Egypt reverse its status of net importerto become a net exporter of natural gas once again.

Egypt signed a deep-water oil and gas exploration deal with Shell andPetronas worth around $1 billion for acreage in the West Nile Delta.The companies are expected to drill eight wells, according to Egypt’sMinistry of Petroleum. In addition to the Shell and Petronas deal, theMinistry signed a deal with Rockhopper, Kuwait Energy and DoverCorp. worth $10 million. This deal is for exploration in Egypt’sWestern Desert.

Leading the charge in bringing Egypt’s natural gas activities to the topof the resource heap is ENI and its famed, super-sized Zohr field whichcame online when the country was last covered in depth by PetroleumAfrica in May 2018. The Italian firm has continued to work to increaseproduction on the development. Just recently ENI said it was working


AFRICAN FOCUS

Headline inflation slowed to an annual 13.5% inJuly 2018 from a record high of 33% a year ago.Core inflation fell to single digits for the first time inmore than two years.Foreign exchange reserves continued to improve andreached $44.3 billion in end-July 2018.

An Economy on the Mend

on completing thedrlling of its fourteenthZohr well. The additionof this well will markthe total number ofp r o d u c i n g w e l l son the field at 10. Thewell is expected toimmediately be putonto production once

complete. The company will start evaluating the field’s production toestimate the number of wells to be drilled in the second phase of theZohr field project. ENI is looking to boost production rates to 3 Bcf/dby the end of the year. The company also completed its latest stakesale in the Shorouk concession where the Zohr is located. When lastcovered, ENI had sold off stakes to BP and Rosneft, the latest salegives Mubadala Petroleum a 10% holding in the prolific acreage.

In late-2018, ENI awarded Saipem and Petrobel an offshore contractaddendum worth more than $1.2 billion for EPCI activities in relationto the “Ramp Up to Plateau” phase of ENI’s Zohr Field DevelopmentProject. The current addendum to the work includes the installation ofa second 30-inch diameter gas export pipeline, infield clad lines,umbilicals and electrical/fiber optic cable, as well as EPCI work forthe 10-well field development in deep water. The ramp up to plateauphase was scheduled to commence in January, in direct continuity withthe optimized ramp up phase which has been completed in over a 17-month project execution period from its contract award. The new phaseof work has Saipem deploying a range of highly specialized vesselsincluding the Castorone, the latest generation of ultra-deep waterpipelayer; the FDS, a subsea field development ship; the Heavy LiftVessel S7000; the DP3 subsea construction vessel Normand Maximus;the subsea construction vessel Saipem 3000; the pipelay vessel CastoroSei and the multipurpose Normand Cutter and Far Samson vessels.

In addition to the Zohr work, ENI has been working hard on a numberof other projects in Egypt, including knocking out a discovery in theWestern Desert on the East Obayed concession. The discovery wasmade with the drilling of the Faramid South exploration prospect. Thewell reached the target depth of 17,000 ft and encountered several gasbearing layers in the Kathabta sandstones of Jurassic age. The well hasbeen opened to production delivering 25 Mmscf/d, confirming thepotential of the East Obayed concession.

The company also made a light oil discovery with the drilling in theFaghur Basin. The discovery well, the SWM B1-X, on the South WestMeleiha license, was drilled to a total depth of 4,523 meters andencountered 35 meters net of light oil in the Paleozoic sandstones ofDessouky Formation of Carboniferous age and in the Alam El Bueibsandstones of Cretaceous Age. The well was opened to production inthe Dessouky sandstones and delivered 5,130 bpd with low associatedgas. According to ENI, the discovery confirmed the high explorationand production potential of deep geological sequences of the FaghurBasin and it plans (in the near term) to drill other exploratory prospectslocated nearby the A2-X and B-1X discoveries to consolidate what canresult as a new productive area. The production is expected to be

routed to already existing infrastructures and then shipped to theEl Hamra Terminal through existing pipelines, after Development Planapproval by the Ministry of Petroleum and Mineral Resources.

Zohr partner BP has been busyin the country and let it beknown in Q4 2018 that itplanned to be a lot busierinvest ing in i ts assets .According to CEO, BobDudley, the company will spendmore than $1 billion in thecoming year. Dudley said thatBP will spend $1.8 billion onnew discoveries and licensingrounds as it looks to expand itsoperations in the Middle East.“We’ve spent in the last two years $6.8 billion in Egypt and it will beabout $1.8 billion dollars next year.” In early December BP revealedthat it was acquiring a 25% participating interest in the Nour NorthSinai concession area from ENI. The concession is located in the EastNile Delta Basin, approximately 50 km offshore in the EasternMediterranean, in water depths ranging from 50 to 400 meters andcovering a total area of 739 sq km. ENI spud its first well on theconcession just prior to the deal being made. The company expects thestart-up of the third phase of its West Nile Delta development, theRaven soon. The Raven follows the Taurus / Libra and Giza / Fayoumstart-ups. This phase will see the development of 5 Tcf of natural gasand 55 million barrels of condensates. The Phase 3 Raven projectincludes eight wells and will be developed as a deepwater long distancetie back to shore, where the new Raven onshore plant is being built,immediately adjacent to the Giza / Fayoum facilities.

Australian independent Rockhopper Exploration recently releasedan update on its holdings in Egypt, specifically the Abu Sennanconcession. Its Al Jahraa-10 well, during Q4, reached total depth inthe Abu Roash-F formation. Oil pay was calculated in the Abu Roash-C and Abu Roash-D levels. Following testing operations, the well wasbrought into production from Abu Roash-C at a rate of 130 bpd gross,and subject to further increase. Upside potential exists in Abu Roash-D which is being evaluated for possible acid stimulation. Explorationwell ASZ-1X located on Prospect S was spud in November and wasthe first of two commitment wells to be drilled in the first phase of thenew concession. An oil discovery was made in the Abu Roash-C levelwith preparations underway to test and produce. The operator hasapplied to EGPC for a development lease over the discovery. Followingjoint venture approval, an active drilling program has been agreed for2019 including the drilling of one exploration well, two developmentwells and a water injection well. Activity in 2019 continues to targetthe Al Jahraa field, as well as further exploration on the concession.Drilling is expected to commence in Q1.

US independent IPR Energy has been drilling away over the past yearor so, executing its largest drilling and operational campaign sinceentering the upstream sector in Egypt in 1993, with the drilling of 25of 40 planned wells during H1 2018 alone. The pace of activity carriedout through the rest of the year with 15 additional wells in different

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areas of the country. The 2018 drilling and workover programs spannedthe Western Desert, Nile Delta, and Gulf of Suez in IPR’s operated andnon-operated portfolio of assets. This combination of exploration,appraisal, and development drilling has increased the company’supstream gross production in Egypt to over 21,000 bpd.In the Western Desert, IPR discovered a new field in the Alamein Leasewith the Southeast Alamein-1X (SEAL-1X) exploration well. SEAL-1X encountered 97 ft of pay from the Razzak sand, Basal Middle andUpper Bahariya sands and Abu Roash “G” Dolomite. The Alameinfield continued development activity with IPR drilling two new wells(AL-42, AL-44), bringing an additional 580 barrels of oil to the field’soverall production. A Dahab sand was discovered in exploration wellAL-45X, with virgin reservoir pressure, reinforcing the extendedpresence of channel sands not produced in prior development campaigns.Initial test rates exceeded 850 bpd. These wells were drilled with newtechnology by IPR International Oilfield Services’ 750 HP rig (IPR-Rig 1), which saw record times and reduced costs for wells as deep as8,500 ft. IPR also applied for the first time hydraulic frac technologyin the offshore North July Concession in the Gulf of Suez to restoreproduction after a successful fracture stimulation workover programin NJ-1 and produced steadily at 550 bpd after the frac job. Artificiallift scenarios are presently being analyzed by field operators to maximizeproduction from this platform, which has been producing water freesince 2001.

Pico Oil and SDX Energy encountered oil pay on a well located in theSouth Ramadan concession offshore Egypt in the Gulf of Suez. SDXEnergy is a 12.75% equity owner in the concession with Pico holding37.5% and operatorship and GPC holding the remaining 50%. Thepartners’ SRM-3 well reached a target depth of 15,635 ft and encountered75 ft of net conventional oil pay in the Matulla section (primary target),20 ft of net conventional oil pay in the Brown Limestone formationand a further 15 ft of net conventional oil pay in the Sudr section. Thewell will be completed in the Matulla section and then tested to establishwhether the well will flow at a commercial rate.

SDX Energy, in addition to the South Ramadan action, saw itsdevelopment lease application for the South Disouq approved byauthorities. Construction of a pipeline and central facility have already

started. First production from the license remains on track to starttowards the end of H1 2019, with SDX expecting to achieve a grossplateau production rate of conventional natural gas of between50-60 Mmscf/d. The 170 sq km 3D seismic acquisition program atSouth Disouq is 50% complete and is expected to conclude in earlyFebruary. The seismic data will then be processed and interpreted bythe end of Q3 2019, with drilling on the license set to resumeshortly thereafter.

Another independent active in Egypt is Apache Corp. In mid-2018the company expressed interest in expanding its activities and investmentsin Egypt, “breaking new ground” in the Egyptian petroleum sector,according to a statement from the North African country’s Minister ofPetroleum and Mineral Resources Tarek el Molla. The company saidit is interested in participating in Egypt’s international tender, specificallyin bidding on 11 blocks with five of those being in the Western Desert.In July 2018 EGPC and Apache signed a seven-well oil drillingagreement for the East Bahariya concession. In Q3 alone, the companyhad 12 drilling rigs active and an average production rate of 78,000boepd. The company has acquired approximately 1 million acres todate of a planned 2.6 million-acre seismic shoot. In 2018 the companyinitiated the next phase of the program on its new Northwest Razzakconcession.

The West Nile Delta Phase 9B, operated by Shell and its partnerPetronas, will bring production of natural gas from twodeepwater wells. According to Egypt’s Petroleum Minister, thecomplete project also includes several other wells being dugand linked to production. The additional wells are set forcompletion in H2 2019 and the output aims to reach400 Mmcf\d. Phase 9B was originally scheduled to comeonstream in 2017 but was delayed until Egypt reached an agreementwith the partners.

A new entrant to Egypt’s E&P scene, Apex International Energy,signed two concession agreements for 1.7 million acres encompassingthe West Badr el Din and South East Meleiha (2,535 sq km) concessions,located in the prolific Abu Gharadig Basin in Egypt’s Western Desert.Apex was awarded the two blocks as part of EGPC’s 2016 bid round.In mid-2018 the company awarded a contract to acquire 1,000 sq kmof 3D seismic data in the Southeast Meleiha Concession to BGPInternational Egypt. Additionally, a host of awards were made to Weir,Vallourec Oil and Gas France, Soconord S.A., and Tenaris GlobalServices S.A. for the purchase of wellheads, well casing and tubing tosupport the company’s planned drilling program.

Italian firm Edison is selling off its assets in Egypt. According toreports, Apex International Energy and Neptune Energy are amongcompanies considering bids to purchase up to $2 billion of the company’sexploration and production assets in Egypt and Italy. The deadline forbids on these assets was in January of this year, but the companies hadnot yet confirmed whether they would submit bids. Edison’s parentcompany, EDF, is selling oil and gas assets to increase investment inits nuclear and renewable energy segments.

It isn’t only the E&P firms who are adding value to Egypt’s petroleumsector, service firms also contribute. Schlumberger officially inauguratedits Egypt Center of Efficiency (ECE) facility at the Polaris Industrial



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City in 6th of October city. The inauguration took place on December12 during the company’s event to celebrate its 80 years of operationsin Egypt. “The ECE is one of the largest facilities in the world bringingthe latest in oil field technologies and providing platform for teams todeliver the highest safety and quality for our customers in the region,”

said Paal Kibsgaard, Schlumberger Chairman and CEO. During theinauguration, Schlumberger signed three MoUs with EGPC and Petrojet.Under the MoUs, Schlumberger will provide training opportunities forfresh graduates, and other programs for petroleum engineers and middle-management.

AFRICAN FOCUS

Egypt’s downstream picked up a bit over the year, not only on oil butin gas. Egypt took a major step towards energy independence whenPetroleum Minister El Molla revealed that one of the regasificationvessels off its coast would be leaving. The Minister told Reuters theother vessel would stay behind as part of the Ministry of Petroleum’sstrategy to maintain energy supplies for the country. In January Egypt’slargest LNG JV, Egyptian LNG (ELNG), was up and running onceagain. The Idku plant was shipping some 520 Mmcf\d of LNG. Theexports reflect Egypt’s growing domestic natural gas production, whichled the country to end the import of LNG and become a natural gasnet exporter once again.

Another downstream project that revolves around gas, this time cominginto the country, is a pipeline from Israel to Egypt. Overseas PrivateInvestment Corporation (OPIC), the institution that funds projects ledby US firms in developing countries, said it will provide funding forthe pipeline. The project will transport natural gas from Noble Energy’sgas fields offshore Israel to Egypt. This investment will be used torestore and maintain a pipeline, which will strengthen the supply ofnatural gas in Egypt. Over the past several months Noble Energyexecuted multiple agreements to support delivery of natural gas fromthe Leviathan and Tamar fields, offshore Israel, into Egypt. This helpsEgypt in its ambitions to become a regional energy hub, providingaccess to both growing domestic markets and existing LNG exportfacilities. Noble and some of its partners are acquiring an effective

39% equity interest in Eastern Mediterranean Gas Company, whichowns the EMG Pipeline. The EMG Pipeline is approximately 90-km,located primarily offshore, connecting the Israel pipeline network fromAshkelon to the Egyptian pipeline network near El Arish. Initial gasdelivery through the EMG Pipeline is expected to occur from the Tamarfield to Dolphinus Holdings in Egypt, under Noble’s existing interruptiblenatural gas sales agreement. At startup of the Leviathan field, estimatedby the end of 2019, it anticipates selling at least 350 Mmcf/d, gross,to contracted customers in Egypt.

In addition to bringing in gas from Israel there are plans for Egypt tobring in gas from Cyprus for processing. Under the terms of the agreement,gas offshore Cyprus could also be used for Egypt’s domestic needs.Following a meeting with the president of Cyprus, Nicos Anastasiades,El Molla told reporters “it is really a way to have… good, win-winpositions for not only Cyprus and Egypt, but also for Europe.” TheCypriot minister said the agreement concerns building a pipeline fromthe Aphrodite discovery area to Egypt. The deal can also apply to othergas fields that may be discovered off the island in the future.

On the crude refining end, the Middle East Oil Refinery (Midor) andTechnip signed a $1.7-billion agreement that has the Italian servicefirm taking a leading role in the expansion of the Midor refinery. Theproject will see the refinery’s production capacity increase from 115,000bpd to 175,000 bpd.

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hat is now Tanzania was formed in 1964 following theunion between the Republic of Tanganyika and the People’sRepublic of Zanzibar. The East African country has enjoyed

relative political stability for a number of decades, with smoothtransitions of power following presidential elections over the years.The country’s founding fathers – Mwalimu Julius Kambarage Nyerereand Sheikh Abeid Amani Karume – set the stage for its strong socio-political foundation.

Currently the country is led by John Magufuli, who emerged as thevictor in the country’s most competitive election in 2015.Nicknamed “The Bulldozer” for his energetic road-buildingdrive and reputation for honesty as a minister, he won the 2015election on promises to boost economic performance and, likethe opposition, fight corruption. He also pledged to tackleyouth unemployment, which like in the majority of other Africannations is a problem for Tanzania. Further, Magufuli promisedto establish free primary and secondary education for thecountry’s youth.

While Magufuli has continued in the country’s tradition of stability,there has been some concern over some of his political stances. Theconcerns come to the surface over his campaign against the independentmedia and gay rights. Tanzanian laws encourage self-censorship whilethreats and attacks against journalists hinder critical reporting, accordingto US-based Freedom House. A “restrictive” Media Services Bill wasintroduced in 2016, replacing independent media oversight arrangementswith a state-run agenda.

Tanzania’s overall economic performance is strong, with a good rateof growth. The African Development Bank, in its continental economicoutlook report, tagged the country’s GDP growing at an estimated 6.6%over 2019 and 2020. Last year the country reported an estimated 6.7%GDP, with the services sector as the main contributor. Tanzania’seconomy also sees contributions from the agriculture and tourismsectors, historically. Today, the mining and energy sectors are drawingincreasing amounts of investments. The country will become a netexporter of natural gas once the massive discoveries off its coast aredeveloped, adding significantly to government coffers.

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By Jennifer Nickle, Deputy Editor

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President: John Magufuli (since November 2015)Independence: April 1964 (from UK)Population: 55,451,343(July 2018 est.)GDP (purchasing power parity): $162.5billion (2017 est.)GDP - real growth rate: 6% (2017 est.)GDP - per capita (PPP): $3,200 (2017 est.)Director General of Energy: Dotto Biteko

Oil - production: N/AOil - consumption: 72,000 bpd (2016 est.)Oil - proved reserves: N/ANatural gas - production: 3.115 billion cubic metersNatural gas –consumption: 3.115 billion cubic metersNatural gas - proved reserves: 6.5 billion cubic meters

Tanzania

Source: CIA FactBook

Politics & Economy

Tanzania is blessed with significant amounts of natural gas and currentlya major amount of its power generation uses production from onshorefields as feedstock. The companies producing this gas are smallerindependents who maneuvered their way into a position of dominancein the onshore arena. Firms like Aminex plc, Orca Exploration, andWentworth Resources are all producing natural gas for domesticconsumption.

Over the past year Aminex conducted drilling and seismic programsover the Ruvuma PSA acreage. The company has finalized theChikumbi 1 executive drilling and completions programs, identifiedand selected the service companies required to operate all aspects ofdrilling and, based on a competitive tender process, selected SaksonDrilling and Oil Services DMCC to drill the Chikumbi-1 well. It alsoidentified and designed an approximately 220 sq km 3D program over

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the Ntorya development area.The Chikumbi-1 well is locatedwithin the Mtwara License ofthe Ruvuma PSA, west of thesuccessful 2017 Ntorya-2appraisal well, in the onshoreportion of the Ruvuma Basin.Chikumbi-1, which will bedrilled to a total true verticaldepth of 3,485 meters, willfulfil one of two remainingexploration commitment wellsand, upon success, is intendedto be completed as a producingwell in a future developmentprogram. Further, Aminex hassigned a conditional rig sharing

agreement with Heritage Oil Ltd. in Tanzania in order to reducemobilization/demobilization costs for both parties.

The company also progressed conditions required to close out a farm-out agreement signed with the Zubair Group in early July 2018. Pendingthe successful completion of the farm-out, Aminex will be fully carriedthrough to production, which will include the drilling of multiple wells,seismic acquisition and construction of associated infrastructure.

On the Kiliwani North License over the period, the company engagedSchlumberger SEACO to remediate and troubleshoot a faulty subsurface safety valve (SSSV) on its Kiliwani North-1 well. Schlumbergermobilized to location and the SSSV was repaired. During the operationthe well was fully opened and test gas flowed to the plant for a shortperiod. Aminex believes that there is a fluid column in the well and isanalyzing the operational and testing data. The license has an expirydate of 2036 with no further commitments, has a Gas Sales Agreementin place and access to a Gas Facility with significant ullage. Mappingby Aminex has identified a structural lead, Kiliwani South, with a meanestimated GIIP of 57 BCF. The company is the operator of both theKiliwani North Development License and the adjacent Nyuni AreaPSA with 63.8304% and 100% working interests respectively. Aminexhas identified areas to conduct the acquisition of 3D seismic with theintent of progressing low-cost drilling prospects which can be tied intothe existing facilities and monetized.

Orca Exploration isthe operator of theSongo Songo gas fieldand it operates a gasprocessing facility onSongo Songo Islandon behalf of SongasLimited on a no loss,no gain basis. Theplant supplies naturalgas to a 25-km 12"offshore pipeline anda 207-km 16" onshorepipeline and is used

by the power sector and industrial markets in the Dar es Salaam area.Songo Songo was Tanzania’s first natural gas development.

In its most recent operational report, Orca said that its subsidiary, PanAfrican Energy Tanzania (PAET), signed a short-term sales agreementwith state-run oil and gas company Tanzania Petroleum DevelopmentCorp. (TPDC) and the state-run utility Tanzania Electric SupplyCompany (Tanesco), for the immediate supply of gas to Tanesco of upto 35 Mmcf/d. These additional volumes are being processed andtransported through TPDC’s National Natural Gas Infrastructure (NNGI)and will allow Tanesco to generate increased and more stable powerto meet the country’s emerging demand.

First gas flowed through the NNGI on December 24 and productionaveraged 20 Mmcf/d in the first 10 days of operation. Total AdditionalGas sales, including those through the Songas gas processing andtransportation system (Songas Facilities), averaged 56 Mmcf/d overthe same period. The agreement provided a mechanism for the partiesto agree to one-month extensions for a maximum term of six monthsand is expected to be superseded by a long-term agreement. Thecompany said that it can supply additionally volumes from its existingwell stock. Two wells, SS-11 and SS12, are tied into the NNGI andSS-10 will be connected if required to meet demand. PAET is currentlyin the process of installing a refrigeration package as part of the SongasFacilities to ensure that gas can continue to be processed at the plant’scapacity. It is expected that this will be operational by mid-2019.

Wentworth Resources alsosupplies natural gas for theKinyerezi-1, Kinyerezi-2, andUbungo II power stations, andindustrial customers includingDangote Cement and GoodwillCeramics. The company saidthat this demand from off-takerscollectively resulted in anaverage daily production in Q42018 of 87.3 Mmscf/d and forthe month of December, 92.5 Mmscf/d. The average production forthe full year 2018 was 83.2 Mmscf/d; above the company’s 2018production guidance range of 65 – 75 Mmscf/d and greater than theDaily Committed Quotient (DCQ) of 80.0 Mmscf/d, which the JointVenture Partners are required to supply under the Gas Sales Agreementwith TPDC and for the Tanesco-owned, Mtwara Power Station s(circa 2.5 Mmscf/d).

In January, Wentworth and TPDC were continuing discussions withregards to reducing the Madimba gas receiving facility export pressurefrom the current 92.5 barg to around 75 barg to extend the productionplateau. This will allow for a sustained overall production rate and/orplateau period from the current well stock, prior to installation ofcompression facilities.

Wentworth’s operational activities in 2019 will include working withTPDC to determine the optimal operating transnational pipeline inletpressure for the system and ensuring the maintenance of the currentproduction plateau using existing wells and infrastructure. The Mnazi

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Bay JV anticipates conducting slickline and choke upgrade activitiesand will perform regular pressure build up tests to further reduceuncertainty with respect to in-place and recoverable gas volumes overthe forthcoming year. These activities will help to ensure thatforecast production meets the Daily Committed Quotient (DCQ) of80.0 Mmscf/d, which the Mnazi Bay JV is required to supplyunder the Gas Sales Agreement with TPDC and for theTanesco-owned, Mtwara Power Station, without risking a shortfall in2019 and beyond.

While the onshore operations provide a solid production base for thecountry’s domestic consumption, its offshore resources will put it onthe exporters map when the government and partners eventually cometo an agreement on the way forward. Tanzania has around 58 Tcf ofnatural gas reserves sitting offshore in the Ruvuma Basin that are yetto be developed. Major oil companies looking to develop these reservesinclude Equinor, ExxonMobil, and Royal Dutch Shell. The governmentis looking to tie in the finalization of the development plan withsignificant infrastructure commitments. With its neighbor Mozambiquealready having progressed its monetization plans for its considerableresources, the Tanzanian government is realizing the importance offinalizing with its contractors – Equinor, ExxonMobil and Shell – soas not to lose out to Mozambique and other global resources holderson securing buyers for its LNG.

At present, Tanzania is trying to speed up talks to move its LNG ambitionsforward and toward that end, talks between Equinor and ExxonMobil,who discovered a host of resources offshore, and the government, areongoing to develop an onshore LNG project. These talks suggest arenewed sense of urgency for the government who would like to be ableto begin securing its own gas supply agreements.

Equinor and ExxonMobil hold stakes in Block 2 offshore the country.The block is estimated to contain more than 20 trillion cubic feet (Tcf)of natural gas in place. While the government indicates it wants to pushforward, an Equinor spokesman told the Petroleum Economist“Negotiations have not yet started and a timeframe has not yet beenput in place. From our side we are committed to contribute to anefficient execution of the negotiations.”

The possible glitch in progressing Tanzania’s LNG ambitions is thefact that ExxonMobil holds stakes in neighboring Mozambique’s gasdevelopment. There were rumors that the US supermajor wanted tosell its stake in Tanzania to focus its attention on the planned LNGproject in Mozambique where it is partnered with ENI. However,ExxonMobil contends it is committed to Tanzania and monetizingresources discovered there.

Shell and Ophir Energy have also discovered massive natural gasresources on their Blocks 1 and 4. The two blocks are estimated tohold around 16 Tcf of recoverable gas. It is most likely that theEquinor/ExxonMobil and Shell/Ophir blocks will be developed througha single LNG facility. According to a Shell spokesperson speaking tothe Petroleum Economist, “It is our understanding that the objectiveof all partners involved in the Tanzania LNG project is to have a single,joint project. We share the view that such a joint integrated project willresult in a globally competitive LNG project, which will yield fargreater benefits for the host country than a small project can.”

When and if Tanzania’s LNG plans bear fruit the export facility isexpected to be located on the coast at Lindi. According to Equinor, theproject could take the form of a 7.5 million ton per year facility, thatcould take around nine years to progress from signing an HGA via aFID to first production.

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Tanzania will play a significant role in neighbor Uganda’s drive to jointhe club of African petroleum producers, as the export point for itsneighbor’s crude. Efforts are on the way to develop adequateinfrastructure for the evacuation of the Ugandan crude and they seemto be moving progressively forward. The two governments exchangedthe inter-governmental agreement for the 1,443-km East African CrudeOil Pipeline in May 2017. The only thing seeming to hold back theproject is the partners in Uganda; CNOOC, Total, and Tullow Oil. Thefirms have yet to take the FID on the development project. Meanwhile,the Host Government Agreements were signed this January. The pipelineis crucial for the further integration of the East African community andto set a positive record of joint planning, financing and implementationof landmark energy projects in the region. The Environmental SocialImpact Assessment report for the pipeline was completed at the endof 2018. The completion and approval of the report will give the green

light for Total to start the implementation of the project. The pipelineis expected to cost $3.5 billion and is planned to have the capacity totransport 216,000 bpd. According to earlier negotiations, Uganda willpay Tanzania $12.20 for each barrel flowing through the pipeline.

Over the period Tanzania sought to expand into the petrochemicalindustry and signed a deal with the process industries business ofthyssenkrupp Industrial Solutions South Africa. The firm was successfulin securing the engineering and procurement contract for a 45-tonmodular skid-mounted chlorine plant in Tanzania, the first of its kindto be installed in sub-Saharan Africa.The modular skid mounted 15-and 45-ton capacity chlorine plants are particularly suited to the Africanmarket as they offer a cost-effective and practical solution to industrieson the continent who require small chlorine alkali plants for applicationssuch as water treatment and mineral processing.

Downstream



MARKET MOVERS

Aqualis Offshore Opens Perth OfficeAqualis Offshore set up an office in Perth, WesternAustralia, to support oil and gas developmentsin the Australasia region. Aqualis Offshore ispart of Oslo-listed energy consultancy groupAqualis ASA.

In Australia, Aqualis Offshore will offer the fullsuite of the company’s services including concept,FEED and basic design engineering; transportationand installation; marine consultancy; rig moving;dynamic positioning & critical systems; marinewarranty; marine casualty surveys; constructionsupervision; rig inspection, preservation andreactivation; technical due diligence; riskconsulting and renewables.

In 2017, Aqualis Offshore successfully completedthe station keeping jobs for both the giant IchthysExplorer central processing facility (CPF) andthe Ichthys Venturer FPSO.

RESMAN and TracercoEnter Patent AgreementRESMAN AS and Tracerco, a subsidiary ofJohnson Matthey Plc, entered into a globalpatent license agreement under which Tracercowill have the right to conduct commercial businessbased on RESMAN’s industry-leading inflowmonitoring patent portfolio. The agreementfollows a mutually agreed decision for the twocompanies to discontinue litigation.

Under the rights of the patents, both RESMANand Tracerco will provide essential well andreservoir monitoring services, enabling oil andgas companies to optimize oil production andsupport decisions for targeted well interventionto ensure operational efficiency.

Special Dividend for BowlevenBowleven’s board of directors approved a specialdividend of approximately £50 million, or 15pence per ordinary share. As of November 30,the company held in cash and financial instrumentsequivalent to $80 million and expects to receivea further $25 million at FID on Etinde. Thisdecision follows the completion of the two-welldrilling campaign in October 2018, and thereforethe directors of Bowleven have resolved todistribute a significant portion of its surplus cashresources to shareholders.

The level of the Special Dividend takes intoaccount the expenditures on the Etinde programfor 2019; the board’s commitment to return surplusfunds to shareholders; the company’s strongbalance sheet allowing for the return of cash toshareholders; and the board’s expectation of

reaching FID on Etinde in the short to mediumterm, triggering a payment of $25 million fromJV partners.

The upcoming Etinde work program and budgethas now been agreed among the upstream jointventure partners for 2019. The detailed effort willcontribute towards the interpretation of the dataand the development options for the block witha view to its commercialization.

Ophir and Medco in Takeover TalksOphir Energy and Medco Energi Global are indiscussions regarding a possible cash offer to bemade by Medco. The cash offer would be forOphir’s entire issued and to be issued share capital.Medco is a leading Southeast Asian energy andnatural resources company listed on the JakartaStock Exchange with a market capitalization ofapproximately $900 million, operating acrossthree key business segments being oil, gas, power,and mining.

Shares in Ophir Energy rose by as much as 35%upon the news of the takeover talks. The mergerwould add Ophir’s 25,000 boepd to Medco’sapproximately 85,000 boepd, with most of thiscoming from southeast Asia.

AFC Closes SIR FacilityThe Africa Finance Corp. (AFC), in its role asSole Mandated Lead Arranger, successfully closeda €577 million debt financing for SociétéIvoirienne de Raffinage (SIR) of Côte d’Ivoire.SIR is the West African country’s only refiner.AFC’s participation was for €192 million. SIRhas an installed capacity of 3.8 million tons perannum of refining capacity and is currently thelargest and most sophisticated operational refineryin West Africa. The purpose of the Facility is torepay historical obligations on crude supply,provide a long tenured facility, and reduce theinterest rate of SIR’s stock of debt.

The Facility comprises a Euro tranche with anine-year maturity and a West African CFA franctranche with a seven-year maturity. The long-term funding solution to refinance historicalaccrued debts will free up resources to enableSIR to make much needed investments in itscurrent operations and upgrade its facility andproduction processes to align with currentenvironmental emissions standards and expandits business, thereby contributing to job creation.Participating banks include AFC, Deutsche Bank,ICBC Standard Bank, United Bank for Africa,NSIA Bank and Bridge Bank. Counsel for theLenders was Norton Rose Fulbright and Bilé-Aka, Brizoua-Bi & Associés.

The refinancing facility is integral to theInternational Monetary Fund’s financial programfor Côte d'Ivoire as SIR is considered to be astrategic asset for the country.

Sirius Secures Funding for OroroSirius Petroleum is looking to raise funds for itsOroro field in Nigeria, and as such, the companysigned a binding agreement for up to $20 millionwith Barak Fund SPC. The $20 million will beused to contribute to the funding of the first phaseof the Ororo field development.

Sirius signed an agreement with Barak for theprovision of a $20 million debt facility, which,subject to the satisfaction of all conditions thereto,can be drawn down in specified tranches followingfirst production. The facility will be deployed topay for costs in relation to Ororo-2 (followingfirst oil) as well as Ororo-3, which are due toservice providers under the staged milestonepayments for the Ororo work program and marksan important step in developing the strategic,long-term partnership with Barak.

The facility has a term of three years from thedate of the first drawdown and is repayable infour equal installments of, if the facility is fullydrawn, $5 million (plus accrued interest thereon)in the last four quarters of the term of the loan.Commencing from drawdown, interest is chargedat three-month LIBOR plus 10% and is payablequarterly in arrears.

Other key terms of the facility are that the facilitymay be cancelled, and the outstanding amountsof the loans declared immediately due and payableby Barak upon, among other things, a change ofcontrol of Sirius or on the disposal of all orsubstantially all of the assets of Sirius’ group.Sirius has given customary negative pledges,warranties, undertakings, events of default andindemnities to Barak. Sirius will grant Barak anall assets debenture and a security assignment ofreceivables by way of assignment of offtakecontracts. Drawdown is conditional upon, amongother things, the satisfaction of customaryconditions precedent.

Oil and Gas Talent Registry for UgandaIn East Africa, the Petroleum Authority of Uganda[PAU] has developed a national talent register,listing individuals trained and qualified in differentfields related to the oil and gas industry. Theregister is the first of its kind in the region.

The PAU has placed the database online andintends for it to serve as an employment referencepoint for its emergent oil and gas sector, will list


engineers, technicians and skilled workerscompetent to work in the oil and gas projects.

Ernest Rubondo, executive director at PAU, whilelaunching the talent register described the NationalOil and Gas Talent Register [NOGTR] as anational supplier database which will serve as aroster for local and international service providersfor the sector.

The PAU executive director went on to say thatthe development of the NOGTR is one of thespecific initiatives that relates to promotingemployment of Ugandan citizens and that it is afulfilment of the statutory requirement ofemploying Ugandans in the oil and gas sector asrequired under sections 126 and 54 of thePetroleum Act 2013, respectively.

Survitec Opens New Service HubSurvitec opened a new service and distributionhub in Singapore to meet increased demand fromcustomers across the Asia Pacific region. Theextensive complex in Singapore’s Sembawangdistrict covers a 7,153 square meter area, of which1308 square meters is outdoors. With more than200 personnel, it is Survitec’s largest service anddistribution center globally, housing three distinctbusiness units: WH Brennan & Co Pte Ltd,Survitec Safety Solutions Pte Ltd and SurvitecFire Solutions Pte Ltd.

The Survitec products and services supplied bythe Singapore facility include rental life rafts,fire-fighting equipment, safety, rescue andevacuation systems, and marine electronicsequipment, such as EPIRBS. The markets SurvitecSingapore services includes the region’s maritime,defense and aviation sectors.

Survitec’s Southeast Asia business has grownexponentially over the last 10 years and todaythe company operates branches in Singapore,Hong Kong, Shanghai and Korea, serving morethan 5,000 customers across the region.

Total Still Owes Tullow CashTullow Oil revealed in its most recent OperationsUpdate that it was still waiting for Total to paythe funds for its purchase of Exploration Areas1, 1A, 2, and 3A in Uganda. Tullow said that theFrench firm hasn’t paid the balance of the$900 million owed for the 21.75% stake in theexploration areas.

The transaction was completed in January 2017and allowed Tullow to retain only 11.67%ownership interest in acreage in the LakeAlbert region, where a production plateau ofapproximately 200,000 bpd is expected in thenext several years.

Wild Well Control AnnouncesMontrose Facility Expansion in UKWild Well Control (Wild Well), an industry leadingprovider of well control response, subsea andwell control engineering, and training services,announced that it has expanded its Montrosefacility at South Ferryden, UK.

Wild Well, maintains the Well CONTAINED™subsea containment system at Montrose Port.This system provides the most comprehensivepackage of subsea emergency response servicesin the industry. The equipment is staged in aready-to-deploy state and includes full subseawell intervention systems, including a subseacapping stack, debris removal shears,hardware kits for the subsea application ofdispersant and inhibition fluids and otherancillary equipment.

Barry Moir, UK managing director, Wild Well,said, “This facility investment reflects our long-term commitment to support our clients byproviding the best-in-class response to a subseacapping and containment incident. Our highlyqualified emergency response well control andsubsea engineering personnel deliver innovativesolutions in a timely manner and our commitmentto the existing warehouse and extension build-

out will provide an optimum working environmentfor our Well CONTAINED™ service line, whichwill be central to our continued success.”

LSE Says Equa G Firm One to WatchEquatorial Guinea-based Alduco EngineeringServices, a subsidiary of the Alduco Group ofCompanies, has been identified as one to watchin the London Stock Exchange Group’s‘Companies to Inspire Africa 2019’ report.

The report, which was released in January, lists360 companies from 32 different countries acrossthe continent as new cohorts of fast growing anddynamic private businesses across Africa.

To be included in the list, companies need to beprivately held and show an excellent rate of growthand potential to power African development.

“It is an honor to put Equatorial Guinea on themap as a country that has hard workingentrepreneurs contributing to the development ofnot only the country, but also the continent,”Alduco Engineering Services Group ManagingDirector, Alfredo Jones, said upon hearingthe news.

Savannah to Raise CashSavannah Petroleum intends to conduct anaccelerated book build to raise gross proceeds ofapproximately $23 million by way of a placingof new ordinary shares of £0.001 each in thecompany. Savannah intends to use the proceedsof the Placing to fund working capital.

At current prices, the new Ordinary Shares issuedpursuant to the Placing are expected torepresent approximately 7% of its current issuedshare capital.

Mirabaud Securities and H&P Advisory are actingas joint book runners in relation to the Placing.Shore Capital Stockbrokers is acting asLead Manager.


POWER & ALTERNATIVES

Grand Renaissance InitialCapacity Expected Next YearInitial energy production from the GrandRenaissance dam in Ethiopia is set to begin in2020, according to Ethiopia’s Water and SanitationMinister Seleshi Bekele.

“We expect the dam to be fully operational bythe end of 2022. 750 MW of power is the plannedinitial production with two turbines by Decembernext year,” said Bekele.

The Grand Renaissance Dam will aid the countryin meeting its goal of becoming Africa’s biggestpower exporter. The dam is expected to produce6,000 MW of power when fully operational.

Bekele saidthat the $4billion dam is80% completea n d t h eperformanceo f h y d r o -mechan ica lw o r k h a s

reached 25%. He added that the Ministry hasbought nine turbines and an energy generator outof which some are at the port yet to be delivered.

Construction of the dam, which was formallyknown as Millennium Dam, began in April 2011and was expected to be accomplished by 2017.It experienced delays however due in part to theelectro-mechanical part of the construction aswell as changes in design to accommodate highergeneration capacity.

Further, the government has signed an agreementwith GE Hydro France, a unit of GE Renewables,to accelerate the completion of the dam. The firmwill be paid nearly $61 million to manufacture,fix and test turbine generators.

Sonelgaz to Send Invoices by TextIn Algeria, customers of the National Electricityand Gas Company (Sonelgaz) will soon receivetheir invoice by phone message (SMS). “Anoperation is underway to allow Sonelgazcustomers to receive their invoice by SMS,”announced Mustapha Guitouni, the Ministerof Energy.

This is part the company’s process of digitizingits operation, particularly as regards thedevelopment of the public service and themodernization of its services. Customers will,among other things, know the amount of theirbills by calling a toll-free number managed byfour centers located in Algiers, Oran, Constantine,and Annaba.

“These centers will also allow clients to submittheir benefit requests with a single call forimmediate, interactive processing; sparing thema move to commercial and technical agencies,”said the Minister, stating that these variousmeasures are aimed at the retention of thecompany’s clientele.

Algeria Plans for SolarPower at Oil & Gas FieldsAlgeria plans to issue several tenders forrenewable energy projects this year as it seeks tomeet growing demand for electricity and savegas for export, an official told Reuters. Solarenergy will also be used at oil and gas fields.

The country is looking to increase its powerproduction by 22,000 MW by 2030 with thesenew solar plants. Tenders will be issued soon forthe plants with a capacity of 150 MW.

“We are (also) planning tenders to produce2,000 MW before the end of 2020,” the officialsaid, without offering further details.

“Our development plan is also aimed atmaintaining contractual commitments withpartners in terms of gas supply,” said NoureddineYassa, head of a National Renewable EnergyDevelopment Center set up to develop the sector.

Ethiopia Plans Large-Scale Solar PlantsIn Ethiopia, the Ministry of Energy launched acall for tenders for the installation of sixlarge-scale solar power plants. The plants wouldhave a combined capacity of almost 800 MWand be located in the states of Afar, Somali,Oromia and Tigray.

The solar plants are being developed as part ofa public-private partnership at an estimated costof approximately $795 million, which will bepartially funded by the government.

These projects are being developed incollaboration with the Scaling Solar program ofthe International Finance Corporation, a memberof the World Bank Group.

The objective of this project is to accelerate theestablishment of solar power plants by providingguarantees and financing to investors to reducethe risk of financing.

Isimba Hydro Plant CommissioningUganda’s Isimba hydroelectric plant wascommissioned on January 24, according to theUganda Electricity Generation Company Limited(UEGCL). The four generators composing theinfrastructure had already been running for a fewweeks prior to commissioning.

Proscovia Njuki, UEGCL chairman of the board,revealed that the commercial operations of theinfrastructure will start in March 2019 and willalso mark the beginning of the charges applicableto the government for the plant.

The 183 MW capacity hydroelectric plant wasconstructed by China International Water &Electric Corporation. Work began in April 2015and cost more than $567 million.

Work on CongoPower Plant CompleteMaintenance work on the Republic of Congo’sCôte Matève power plant is now complete,according to Louis Kanoha Elenga, the directorgeneral of the Congo Electric Power (E2C), thenational electricity company. This work allowedinhabitants of Brazzaville and Pointe-Noire, whohave faced intermittent loadshedding for a six-week period, to have access to electricity for endof year celebrations.

Executed by ENI-Congo, the work consisted ofrenovating one of the plant’s turbines to allow itto operate optimally and to supply its 300 MWnominal capacity, which constitutes 60% of thenational electricity production.

Elenga said, even though the extended powercuts will no longer be reported, the plant may beshut down for short periods of time in order tomake technical adjustments. Currently the state-utility is testing the equipment.

Madagascar to Double Electricity OutputMadagascar plans to double its electricityproduction over the next five years. The newswas revealed by Roland Ravatomanga, thecountry’s new Minister of Energy, Water andHydrocarbons, when he took office.

The achievement of this goal will be achievedthrough five major points, said Ravatonanga. Thefirst is the introduction of new sources of energy- solar, wind, hydroelectric, thermal - in citiesalready connected to the power grid. This willimprove the quality of electricity supply andgradually reduce load shedding.

In addition, in rural areas and localities that aretoo far off the grid, solar electric kits will bemassively distributed at an affordable costand with payment faci l i t ies for thebeneficiary localities.

Finally, alternative solutions such as biogas andbioethanol will be introduced to combat airpollution and deforestation due to the use offuelwood and charcoal as an energy fuel byhouseholds.

Source: Ministry of Water, Irrigationand Electricity


AROUND THE WORLD

Sikorsky HelicoptersSelected for Mexico JobThree Sikorsky S-92® helicopters were selectedby an unnamed major oil firm operating in theGulf of Mexico to provide deepwatertransportation to platforms offshore Mexico.Three fielded S-92 helicopters will support theclient’s operations, including crew change andsearch and rescue.

The S-92 operational tempo continues to growwith 2018 fleet flight hours increasing 7% despitethe downturn in offshore transportation demand.“We are very happy the customer has selectedthe S-92 for this important service,” said DavidMartin, Sikorsky vice president of Oil & Gas.“We are respectful of the trust our customersplace in us, and we are working hard to ensurethis mature and reliable helicopter is also themost economical.”

Mexico’s Directorate General of Civil Aeronauticsapproved the offshore and utility typecertificate for the Sikorsky S-92A helicopter inNovember of 2017.

FID on Midia Gas Development ApprovedBlack Sea Oil & Gas, together with its co-venturepartners, Petro Ventures Resources and Gas PlusInternational, have approved the FID to proceedwith the $400 million Midia Gas DevelopmentProject (MGD Project), offshore Black Sea.

According to Block Sea Oil & Gas, the FID hasbeen taken in good faith and on the assumptionthat it and its JV partners will successfully beable to restore all of their rights with respect tothe removal of any newly imposed supplementaltaxes and fees as well as removing any restrictions,in accordance with EU Directives, on the freemovement of gas on a fully liberalized market inorder to not only make MGD Project a viableinvestment, but also to encourage further gasdevelopments in the Black Sea.

The MGD Project, which is the first new offshoregas development project in the Romanian

Black Sea to be built after 1989, consists of fiveoffshore production wells (one subsea well atDoina field and four platform wells at Ana field)a subsea gas production system over theDoina well which will be connected through an18-km pipeline with a new unmannedproduction platform located over Ana field. A126-km gas pipeline will link the Ana platformto the shore and to a new onshore gas treatmentplant (GTP) in Corbu commune, Constantacounty, with a capacity of 1 Bcm per yearrepresenting 10% of Romania’s consumption.The processed gas will be delivered into theNTS at the gas metering station to be foundwithin the GTP.

LLOG Awards McDermott Stonefly GigMcDermott International won a sizeable contractaward by LLOG Exploration Company fordeepwater subsea pipeline tiebacks and structuresfrom the Stonefly development to the Ram Powellplatform, located approximately 140 milessoutheast of New Orleans, Louisiana.

The scope of work includes project management,installation engineering, subsea structure andspoolbase stalk fabrication, and subsea installationof the subsea infrastructure to support a two-wellsubsea tieback from the Stonefly developmentsite to the Ram Powell platform via a 60,000 foot6-inch pipeline at water depths ranging from3,300 to 4,100 ft. McDermott will also design,fabricate and install a steel catenary riser, apipeline end manifold, and two in-line sleds.

The Stonefly development includes the VioscaKnoll 999 area where McDermott is scheduledto use its 50-acre spoolbase in Gulfport,Mississippi, for fabrication and reeled solutions.McDermott is scheduled to install the subseatiebacks and structures using its North Ocean105 vessel in Q3 2019. Structure design andinstallation engineering began in January 2019in McDermott’s Houston office.

The Ram Powell tension leg platform is locatedin 3,200 feet of water in the Viosca Knoll Area,Block 956, and is capable of processing 60,000barrels of oil per day and 200 million cubic feetof gas per day.

OPEC and Allies Begin Production CutsLast month an OPEC-led block agreed to slasha combined 1.2 million bpd of production in orderto boltser crude oil prices that have started toslump in recent months.

Algeria’s state-controlled news agency, APS,reported that under its new OPEC quota, the

country will have to drop its output by24,000-25,000 bpd. According to SalahMekmouche, Sonatrach’s upstream executive,the 24,000-25,000 bpd cut back took effectJanuary 1.

Mekmouche said that before the agreementreached by OPEC members and its allies led byRussia was reached last month, Algeria wasproducing 1.08 million bpd.

Angola and Nigeria will absorb heavy productioncuts as well, at 32,000 bpd and 50,000 bpdrespectively. The remaining two Big Five Africanproducers, Egypt and Libya, will not be makingcuts as Egypt is not an OPEC member and Libyais exempt.

Meanwhile, other members and non-membersfrom Africa – including Congo, Equatorial Guinea,Gabon, South Sudan and Sudan – will also cutback some of their production to assist in thiseffort to stabilize pricing by leveling the supplyand demand equation.

Saudi Arabia will take the biggest hit, taking over300,000 bpd off the market, and non-OPECmember Russia is expected to pare down230,000 bpd.

Saipem Awarded EPIC in SaudiSaipem was awarded two EPIC contractsassigned by Saudi Aramco for a total amount ofapproximately $1.3 billion as part of the Long-Term Agreement for offshore activities inSaudi Arabia, renewed in 2015 and in forceuntil 2021.

These two contracts refer to, respectively, thedevelopment of offshore fields in Berri andMarjan, located in the Arabian Gulf, which areamong the most important offshore fields in theMiddle East.

Saipem activities include the design,engineering, procurement, construction,installation and implementation of subseasystems in addition to the laying of pipelines,subsea cables and umbilicals, platform decksand jackets.

Rowan Norway Use Secured by COPSASRowan Companies’ Rowan Norway, an N-Classultra-harsh environment jack-up rig, was awardeda contract in Norway by ConocoPhillipsSkandinavia AS (COPSAS) for an estimatedduration of seven months. The contract isexpected to commence in Q3 of this year; subjectto partner approval.

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Following the initial contract term, COPSAS hastwo options. The first option has an estimatedduration of five months and the second anestimated duration of nine months. The RowanNorway is currently under contract with TurkishPetroleum in the Mediterranean Sea untilapproximately late-April 2019.

Unique and POSH Partner UpUnique Group entered into a contract withSingapore-based POSH Subsea to offer integrateddiving solutions. As part of the agreement, UniqueGroup will design, manufacture and deliverClassed Air and Saturation Dive systems forintegration on POSH’s vessels.

Under this partnership, Unique Group will besupplying a holistic suite of classed air &saturation diving equipment, compliant to thestringent Oil and Gas Producers (OGP) 468 andInternational Marine Contractors Association(IMCA) guidelines, as well as consumables andtechnical support during and post installation,spanning across a two-year period. The UniqueEquipment Manager (UEM), a digitalized plannedmaintenance system integrated with the divesystems will enable POSH to track the conditionof the equipment more accurately. therebyminimizing operational downtime.

Speaking about this partnership, Harry Gandhi,CEO of Unique Group, commented: “We arepleased to announce our partnership with POSH,an industry-leading offshore marine operator.This bears witness to our compliance with theirstringent requirements and is yet another testamentto our track record for delivering timely andquality solutions.”

Tendeka’s AICDsContracted in the Middle EastTendeka has secured a multi-million-poundcontract with an unnamed major national oilcompany in the Middle East. The agreement willsee Tendeka provide reservoir modeling and theinstallation of its FloSure Autonomous InflowControl Devices (AICDs) to boost productionand improve reservoir performance in severalmature fields.

Tendeka will perform reservoir simulations foreach well, working closely with the client toensure optimum reservoir performance, with thetechnology helping in the reduction of unwantedfluid production.

Having carried out several similar projects in theregion, the company has vast experience with thechallenges of brown fields and carbonate reservoirthat form a large proportion of oil fields in theMiddle East.

Tendeka is a world leader in Inflow Controltechnology and has installed more than 7,000passive ICDs and more than 28,000 autonomousICDs globally.

XSIGHT Wins ExxonMobil’sBlue Whale Project in VietnamSaipem’s XSIGHT division was awarded a newonshore-offshore FEED contract for the Ca VoiXanh (Blue Whale) project by ExxonMobilExploration and Production Vietnam Ltd.(EMEPVL) and its JV partners PetroVietnam andPetroVietnam Exploration Production Corp.

The project encompasses the design of thefacilities for the development of an offshore gasand condensate reservoir located within Block118, offshore Vietnam. The treated gas will bedelivered to two power complexes, eachcontaining two power trains.

Saipem will provide the FEED for the projectthat consists of an offshore platform, offshoregas and condensate pipelines, offshore fiber opticcabling, an onshore gas treatment plant (GTP),onshore pipelines and an onshore condensateoffloading facility.

The Ca Voi Xanh development project willprovide a competitive and cleaner energy sourceto Vietnam.

CAOMM SignsContract with ULO SystemsControl & Applications Offshore MarineManagement (CAOMM) signed a contract withULO Systems for the installation of 12,000concrete mattresses utilizing sister companyOffshore Marine Management’s (OMM) MultiMattress Deployment System, MDS3.

The contract, due to be delivered in Q1 2019,covers the installation of 12,000 concretemattresses, manufactured by ULO themselves,to minimize erosion by protecting a river bankon-site at a Nuclear Plant in a rural area ofBangladesh. The supply of the MDS3 system

will be supported by specialist personnel providedby sister company, Offshore Marine People &Academy (OMPA).

The MDS3 system most recently completed amattress installation to protect subsea cable onthe Scilly Isles connector project off the coast ofthe United Kingdom. The use of the MDS3 onthese two projects shows the capability andversatility of the system on a wide range ofprojects and environments, while remaining acost-effective solution.

EPCIC for Esso AustraliaGoes to OneSubsea and Subsea 7 JVSubsea Integration Alliance will perform theintegrated subsea engineering, procurement,construction, installation and commissioning(EPCIC) for Esso Australia Pty Ltd. The contractrepresents the first integrated subsea project forSubsea Integration Alliance in Australia combiningOneSubsea and Subsea 7 expertise in subseaproduction systems (SPS) and subsea umbilical,riser and flowline (SURF) systems.

Subsea Integration Alliance work scope includesthe EPCI of two production wells. The wells arein a water depth of approximately 45 meters andwill be tied back to the Longford onshore gasplants. Project management and engineering willbe provided by OneSubsea and Subsea 7 fromlocal offices in Perth and Melbourne,Australia. Offshore installation activities arescheduled for 2020.

The Subsea 7 scope includes project management,engineering, procurement, construction andinstallation of two production wells and a singleelectro hydraulic umbilical from the BarracoutaPlatform to the West Barracouta drill center.

The One Subsea scope includes the provision oftwo vertical mono bore on-wellhead productiontrees, wellheads, controls and installation andcommissioning services.

Genel AcquiresKurdistan Blocks from ChevronGenelEnergy reached an agreement to acquirestakes in the Chevron-operated Sarta and QaraDagh blocks, in the Kurdistan Region of Iraq.Genel will acquire 30% equity in the Sarta licenseby paying a 50% share of ongoing fielddevelopment costs until a specific productiontarget is reached, together with a success feepayable on achievement of a production milestone.Chevron will retain a 50% interest in the Sartalicense and the Kurdistan Regional Governmentwill hold the remaining 20%.

POSH Mallard, a Multi-PurposeSupport Vessel (MPSV)

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AROUND THE WORLD


Drilling began on the project’s first appraisalwell, Sarta-3, in Q4 2017. The well wassuccessfully completed and tested during thesecond quarter of 2018. Both the Sarta-3 and theSarta-2 well individually tested at rates of around7,500 bpd. The first phase of development isexpected to see these wells placed on production.

Genel will acquire 40% equity in the Qara Daghappraisal license and become the operator througha carry arrangement. Chevron will retain 40% ofthe equity, with the KRG holding the remaining20%. The Qara Dagh-2 well is set to be drilledin 2020. The Qara Dagh-1 well, completed in2011, tested oil in two zones from the Shiranishformation.

Closing is subject to approval from the KurdistanRegional Government.

ExxonMobil and PartnersKnock Out 11 and 12 Offshore GuyanaExxonMobil, Hess Corp., and CNOOC made twonew discoveries off the coast of Guyana. Thesuccess of the Tilapia-1 and Haimara-1 wellsbring the total number of discoveries on theStabroek Block to 12. The latest discoveries build

on the previously announced estimatedrecoverable resource of 5 billion boe on theStabroek block.

Tilapia-1 is the fourth discovery in the Turbotarea that includes the Turbot, Longtail and Plumadiscoveries. Tilapia-1 encountered approximately305 ft of high-quality oil-bearing sandstonereservoir and was drilled to a depth of 18,786 ftin 5,850 ft of water.

The Noble Tom Maddendrillship began drillingthe well on January 7and will next drill theYel lowtai l -1 wel l ,approximately six mileswest of Tilapia-1 inthe Turbot area. The

baseline 4-D seismic data acquisition is underway.

The Haimara-1 well encountered approximately207 ft of high-quality, gas-condensate bearingsandstone reservoir. The well was drilled to adepth of 18,289 ft in 4,590 ft of water. It is locatedapproximately 19 miles east of the Pluma-1discovery and is a potential new area fordevelopment. The Stena Carron drillship began

drilling the well on January 3 and will next returnto the Longtail discovery to complete a well test.There is potential for at least five FPSOs on theStabroek Block producing more than 750,000bpd by 2025. The Liza Phase 1 development isprogressing on schedule and is expected to beginproducing up to 120,000 bpd in early 2020,utilizing the Liza Destiny FPSO.

Liza Phase 2 is expected to startup by mid-2022.Pending government and regulatory approvals,sanctioning is expected in the first quarter of2019 for the project, which will use a secondFPSO designed to produce up to 220,000 bpd.Sanctioning of a third development, Payara, isalso expected in 2019, and startup is expected asearly as 2023.

Noble Tom Madden

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lling

Stena Carron

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FACTS AND FIGURESSo

urce

: BH

GE

*Data not available

Vari

ous

sour

ces

incl

udin

g E

IA, I

EA

and

OPE

C

Country

African Rig Count

AlgeriaAngolaBeninCameroonChadCongoCongo (DRC)Cote D’IvoireDjiboutiEgyptEquatorial GuineaEthiopiaGabonGhanaGuineaKenyaLiberiaLibyaMauritaniaMoroccoMozambiqueNamibiaNigerNigeriaSenegalSierra LeoneSouth AfricaSudan*TanzaniaTogoTunisiaUganda

4650174012

260240080901001900000030

November

2018

5050174012

270240080901001

1100000020

December

* Based on secondary sources

4640174010

250240080901001

1500000030

October

Sour

ce: O

PEC

Country

OPEC Oil Production

AlgeriaAngolaCongoEcuadorEquatorial GuineaGabonIran, I.R.IraqKuwaitLibyaNigeriaSaudi ArabiaUAEVenezuelaTOTAL OPECOPEC exluding Iraq

10561500310522121170

29284626277211001739

1102132831181

3232827702

November

2018

10511490329524108197

276947142800928

17501055332181148

3157826864

December

10541533324525131186

32964653276411141751

1063031601171

3290028247

October

(Thousand Barrels/Day*)

Country

Africa Productionof Crude Oil

AlgeriaAngolaCameroonChadCongo (Brazzaville)Congo (Kinshasa)Cote d’Ivoire (Ivory Coast)

EgyptEquatorial GuineaGabonGhanaLibyaMauritaniaMoroccoNiger NigeriaSouth AfricaSudan and South SudanTunisiaTotal Africa

10561500

811003102028

640121170121

11000

0.520

17393

22948

7286.5

November

2018

10511490

8299

3292028

640108197120928

00.520

17503

23048

7143.5

December

10541533

8090

3242027

640131186121

11140

0.520

17513

22548

7367.5

October

(including Lease Condensate, Thousand Barrels/Day)

Sour

ce: I

EA

Oil

Mar

ket R

epor

t

Country

AmericasCanadaChileMexicoUnited StatesAsia OceaniaAustraliaOthersEuropeNorwayUKOthersTotal OECDTotal Non OECD

23.525.310.011.94

16.270.450.380.073.411.881.010.51

27.3729.37

November

2018

23.335.220.011.97

16.130.450.380.073.411.851.040.52

27.1929.46

December

23.485.280.011.97

16.220.450.380.073.411.861.030.52

27.3429.36

October

World Oil Production(million barrels per day)



International Rig CountsAREA Last Count

USCANADAINTERNATIONAL

Count Change FromPrior Count

Date ofPrior Count

Change fromLast Year

Date of LastYear’s Count

Feb 1, 2019Feb 1, 2019Dec, 2018

1045243

1025

-141134

Jan 24, 2019Jan 24, 2019

Nov, 2018

99-9971

Feb 2, 2018Feb 2, 2018Dec, 2017

656463626160595857565554535251504948474645

January 07Henry HubNew York







2.742.84

2.952.81

3.543.24

3.583.17

3.432.97

3.132.99

3.052.87

Dollars per BTU

Dat

a co

mpi

led

by P

etro

leum

Afr

ica

from

var

ious

sour

ces i

nclu

ding

OPE

C, E

IA a

nd o

ther

s

January 09OPEC BasketBrent CrudeNymex







$58.2259.4652.69

60.0059.2451.91

58.2458.6552.39

60.9062.0454.04

60.6660.9053.01

60.2261.0953.13

59.5759.7151.99

OPEC Basket Brent Crude Nymex

Oil Prices

Gas PricesSpot Price Futures Price*

2.50

4.00

2.00

3.00

3.50

Jan

15

Jan

18

Jan

24

Jan

28

Jan

22

Jan

09

Jan

11

$

Jan

15

Jan

17

Jan

24

Jan

28

Jan

22

Jan

07

Jan

10

Jan

15

Jan

18

Jan

24

Jan

28

Jan

22

Jan

09

Jan

11

Jan

15

Jan

18

Jan

24

Jan

28

Jan

22

Jan

09

Jan

11

Jan

15

Jan

17

Jan

24

Jan

28

Jan

22

Jan

07

Jan

10


CONFERENCES

AD INDEXAfrica Oil & PowerAlternative Energy AfricaCWC Groupdmg eventsEnergyNetDreg Waters Petroleum & Logistics

1151

IFC2339

BC

Euro Petroleum ConsultantsNAPECOffshore Network Ltd.Oil & Gas EurasiaTGS

33, IBC5

2925

7

FEBRUARY 2019

11-13 Cairo, Egypt www.egyps.comEgypt Petroleum Show 2019 (EGYPS)

MARCH 201910-13 Algeria, Algeria www.napec-dz.comNorth Africa Petroleum Exhibition and Conference (NAPEC)

25-26 Bahrain www.gulfsafetyforum.com vGulf Safety Forum 2019

APRIL 20191-5 Shanghai, China www.lng2019.comLNG 2019

6-7 Marrakesh, Morocco www.morocco-summit.com2nd Morocco Oil & Gas Summit 2019

26-28 Abu Dhabi, UAE www.me-tech.bizME-TECH 2019 – Middle East Technology Forumfor Refining & Petrochemicals

25-27 Miami, FL www.poweringafrica-summit.comPowering Africa Summit 2019 (PAS 2019)

27-28 Bahrain www.opex.bizOPEX MENA 2019 – Operational Excellence In Oil,Gas & Petrochemicals Conference

26-27 Johannesburg, South Africa www.terrapinn.comPower & Electricity World 2019

1-5 Malabo, Equatorial Guinea www.africaoilandpower.comAPPO Cape VII (7th African Petroleum Producers OrganizationConference & Exhibition)

MAY 20192-3 Houston, TX www.energycorporateafrica.com12th Annual Sub-Saharan Africa Oil & Gas Conference 2019

27-29 Sardinia, Italy www.europetro.comIDW 2019 – International Downstream Week

JUNE 20194-5 Accra, Ghana bit.ly/2S6yT9JOffshore Well Intervention – West Africa

4-6 Luanda, Angola www.africaoilandpower.comAngola Oil & Gas 2019

11-11 London, UK www.africaoilandpower.comLondon Investor Forum 2019

OCTOBER 20192-4 Cape Town, South Africa www.africaoilandpower.comAOP 2019 (Africa Oil & Power)

NOVEMBER 2019

26-27 Malabo, Equatorial Guinea www.yearofenergy2019.comGECF 5th Gas Summit

DECEMBER 2019

10-11 Bahrain www.bbtc-mena.bizBBTC MENA 2019 – Bottom of the Barrel Technology Conference

JULY 20191-4 Abuja, Nigeria www.cwcnog.comNigeria Oil & Gas

TBA Dar Es Salaam, Tanzania www.cwctog.comTanzania Oil & Gas Congress

28-29 Algiers, Algeria www.algeria-future-energy.comAlgeria Future Energy

20-21 Maputo, Mozambique www.mozambique-gas-summit.com6th Mozambique Gas Summit & Exhibition

2-5 Yenagoa, Nigeria www.cwcpnc.com9th Practical Nigerian Content

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