Kenya afrika

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Drilling and Exploration Strategies for Kenya and Niger 2014

Transcript of Kenya afrika

Page 1: Kenya afrika

Drilling and Exploration Strategies

for Kenya and Niger 2014

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Kenya Opportunities • Geotermal• Oil and Gas

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Facts

Background• Kenya gained independence in 1963

• Total Area : 580.367km2

• Etnics : Kikuyu 22%, Luhya 14%, Luo 13%, Kalenjin 12%, Kamba 11%, Kisii 6%, Meru 6%, other African 15%, non-African 1%

• Language : English (official), Kiswahili (official)

• Religion : Christian 82.5% , Muslim 11.1%, Traditionalists 1.6%, other 1.7%, none 2.4%, unspecified 0.7% (2009 census)

• Population :44,037,656 (July 2013 est)

• GDP (purchasing power parity): $77.14 billion (2012 est.)

• Budget : $7.418 billion (revenue)

• Industries : small-scale consumer goods (plastic, furniture, batteries, textiles, clothing, soap, cigarettes, flour), agricultural products, horticulture, oil refining; aluminum, steel, lead; cement, commercial ship repair, tourism

• Exports : $6.285 billion (2012 est.) tea, horticultural products, coffee, petroleum products, fish, cement to Uganda 10.5%, Tanzania 10.2%, Netherlands 7.1%, UK 6.7%, US 5.8%, Egypt 5.2%, Democratic Republic of the Congo 4.5% (2012)

• Imports :$15.1 billion (2012 est.) machinery and transportation equipment, petroleum products, motor vehicles, iron and steel, resins and plastics to India 20.7%, China 15.3%, UAE 9.5%, Saudi Arabia 6.7% (2012)

Energy• Electricity production : 6.573 billion kWh (2009 est.)

• Electricity consumption :5.516 billion kWh (2009 est.)

• Electricity export : 27 million kWh (2009 est.)

• Electricity import : 38 million kWh (2009 est.)

• Electricity ınstalled generating capacity: 1.706 million kW (2009 est.)

• Electricity from fossil fuels : 43.3% of total installed capacity (2009 est.)

• Electricity from nuclear and hydrolic plants and renewables 0%, 43.8% of (2009 est.), 12.9% of

• Crude oil production : 0 bbl/day (2011 est.)

• Crude oil exports :0 bbl/day (2009 est.)

• Crude import :32,560 bbl/day (2009 est.)

• Crude proved reservs : 0 bbl (1 January 2012 est.)

• Refined petroleum products Production :30,960 bbl/day (2008 est.)

• Refined petroleum products consumption : 79,410 bbl/day (2011 est.)

• Refined petroleum products exports : 1,065 bbl/day (2008 est.)

• Refiend petroleum products imports : 34,990 bbl/day (2008 est.)

• Natural gas production :0 cu m (2010 est.)

• Natural gas consumption :0 cu m (2010 est.)

• Natural gas exports :0 cu m (2010 est.)

• Natural gas imports :0 cu m (2010 est.)

• Natural gas proved reserves :0 cu m (1 January 2012 est.)

• CO2 emission :12.25 million Mt (2010 est.)

• LNG export : 0

• Pipelines : oil 4 km; refined products 928 km (2013)3

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Reasons to Invest in Geotermal Energy in Kenya_2

Kenya intends to be a mid-income economy in the next 20 years. One of the key drivers of this Vision is the availability of affordable and reliable energy. It is projected that the country will require 10, 000 MWe in the next 20 years; 5000MWe of which is expected to come from geothermal sources.The Government of Kenya established the Geothermal Development Company (GDC) to accelerate the development of its geothermal resources. GDC has embarked on a plan to realize at least 5,000MWe of electricity in the next 20 years.Nnumerous investment opportunities in the geothermal development sector ranging from:

1. Supply of equipment and materials2. Developments of steam fields and power plants3. Supply of Early Generation equipment4. Civil engineering and construction works, among others

The current demand exceeds the installed capacity hence a ready market for affordable power is available.The demand for electricity is estimated to increase at the rate of 8% per annum.Only 15% of the population can currently access power. The growth is driven by increased consumption from the existing customers of 5% while new customers account for the 3%.

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Reasons to Invest in Geotermal Energy in Kenya_2

In order to facilitate investor entry into the geothermal sector, GDC will undertake exploration and drilling for all fields and provide steam to investors to mitigate these upfront risks to accelerate investor entry into the geothermal development sector.Current Private Sector Participation include Orpower4 Inc and Oserian Development Company (ODC).OrPower4 has an installed capacity of 55MW which is connected to the national grid. Oserian Development Company operates two binary power plants each with a capacity of 2MW which supply power to its facilities. Oserian also uses the geothermal resources for heating, refrigeration, use of carbon dioxide and hydrogen sulphide to enhance plant growth, fumigation and sterilization of greenhouses.Alternative geothermal usage in Kenya can be applied to:

1. Dairy industry - refrigeration and pasteurization of milk products2. Grain Silos - drying of grains (wheat & maize) and other farm products e.g. pyrethrum3. Space heating - green houses and hotels4. Industry - production of industrial sulphur, treatment of hides and skins and honey processing,5. Water heating for fish and crocodile farming, and spas/swimming pool

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Geotermal Sites

BarrierNamarunuEmuruangogolakSilaliPakaKorosiBaringoBogoriaMenengaiNakuruElmemteitaEbrurruNaivashaLongonotMargaretSuswaMagadiShompoleNatronOlkaria

• More than 14 high temperature potential sites occur along the Kenyan Rift Valley

• estimated potential of more than 15,000 MWe.

• Other locations include: Homa Hills in Nyanza,

• Mwananyamala at the Coast and Nyambene Ridges.

• These prospects are at different stages of development

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Geotermal Potential of Kenya

Geothermal resources in Kenya are concentrated in the Rift Valley with more than 14 fields extending from Lake Magadi to Lake Turkana. There are also low temperature fields outside the rift at Homa Hills (Nyanza) and Massa Mukwe (Coast Province).The current geothermal potential has been estimated at 10, 000 MW.Currently geothermal energy contributes 209 MW which is about 22% of the country’s production. With regard to direct use, a horticultural farm in Naivasha uses about 15 MW of geothermal energy to heat 50 hectares of greenhouses of roses for export. A tourist hotel at Lake Bogoria is utilizing spring water at 38°C to heat a spa pool.The costs affiliated with the development of geothermal projects depend on a variety of factors that include location, megawatt size, distance of the resource to the power infrastructure, and the type of geothermal resource (hot water or steam).The investor signs a Power Purchase Agreement (PPA) with the Kenya Power and Lighting Company Ltd (KPLC) to supply electricity for a given period of time. KPLC also pays capacity charge.

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Kenya_Oil

Production History1st Exploration well 19601st discovery 1960; non commercialTotal Exploration wells drilled 25 onshore 6 offshoreNo current production

There were 26 PSC in force with an acreage of 259.050 km2 where 196.720 km2 onshore and 11.745 km2 on shelf and 50.585 km2 deep water

4 new contracts are assigned and 8 new companies acquired interest

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Oil Blocks in Kenya

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Kenya_ General Terms

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Exploration Production

Type of Right

•Exploration Permit: confers non exclusive geological and geophysical survey rights, excluding drilling rights•PSC: Exclusive right to conduct all E&P activities

•A Production Sharing Agreement

Duration

•Negotiable initial exploration period •First additional exploration period•Second negotiable additional exploration period•Generally 3 + 3 + ‘•The expoariton period can be further extended for evaluation of a discovery

•Minimum of 20 to 30 •Generally the develoopment and production period is 25 years from the date of each development plan

Obligation

•A Seismic commitment is required for the first exploration period •A drilling commitment with minimum expenditure in subsequent exploration periods

Payments•A signature bonus may be required (75.000$-500.000$)•Negotiable training fee is payable

•No production bonuses are payable•A negotiable annual training fee is payable

Rentals •Annual rentals are payable at negotiable ratesAnnual rentals are payable at negotiable rates

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Niger Exloration and Development

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Niger_FactsBackground

• Niger became independent from France in 1960

• Total Area : 1.267 million sq km

• Etnics : Haoussa 55.4%, Djerma Sonrai 21%, Tuareg 9.3%, Peuhl 8.5%, Kanouri Manga 4.7%, other 1.2% (2001 census)

• Language : French (official), Hausa, Djerma)

• Religion : Muslim 80%, other (includes indigenous beliefs and Christian) 20%

• Population :16,899,327 (July 2013 est.)

• GDP (purchasing power parity): $13.34 billion (2012 est.)

• Budget : $1.698 billion(2012 est.) (Revenue)

• Industries : uranium mining, cement, brick, soap, textiles, food processing, chemicals, slaughterhouses agricultural products, cowpeas, cotton, peanuts, millet, sorghum, cassava (manioc), rice; cattle, sheep, goats, camels, donkeys, horses, poultry

• Exports : $1.389 billion (2012 est.) uranium ore, livestock, cowpeas, onions to Nigeria 41%, US 17%, India 14.1%, Italy 8.5%, China 7.7%, Ghana 5.7% (2012)

• Imports :$2.328 billion (2012 est.) foodstuffs, machinery, vehicles and parts, petroleum, cereals from France 14.2%, China 11.1%, French Polynesia 9.9%, Nigeria 9.7%, Togo 5.5% (2012)

Energy• Electricity production : 210 million kWh (2009 est.)

• Electricity consumption :695.3 million kWh (2009 est.)

• Electricity export : 0 kWh (2009 est.)

• Electricity import : 500 million kWh (2009 est.)

• Electricity ınstalled generating capacity: 145,000 kW (2009 est.)

• Electricity from fossil fuels : 100% of total installed capacity (2009 est.)

• Electricity from nuclear and hydrolic plants and renewables 0%, 0% of (2009 est.) 0% of

• Crude oil production : 6,712 bbl/day (2011 est.)

• Crude oil exports :0 bbl/day (2009 est.)

• Crude import :0 bbl/day (2009 est.)

• Crude proved reservs : 0 bbl (1 January 2012 est.)

• Refined petroleum products Production :0 bbl/day (2008 est.)

• Refined petroleum products consumption:5,629 bbl/day (2011 est.)

• Refined petroleum products exports : 0 bbl/day (2008 est.)

• Refiend petroleum products imports : 3.330 bbl/day (2008 est.)

• Natural gas production :0 cu m (2010 est.)

• Natural gas consumption :0 cu m (2010 est.)

• Natural gas exports :0 cu m (2010 est.)

• Natural gas imports :0 cu m (2010 est.)

• Natural gas proved reserves :0 cu m (1 January 2012 est.)

• CO2 emission :1.796 million Mt (2010 est.)

• LNG export : 0

• Pipelines : 0 km

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Introduction

Contract Type• Law no 2007-01 the Oil Code issued on 2007

• 8 years exploration period (4+2+2) plus 1 additional year in case of discovery

• 35 years exploitation period (25+10) with contract term renegotiable by the goverment for the 10 renewal period

• Option up to 20% state participation with minimum carried costs equivalent to 10,5 of State involved

• Signature bonus is applicable

• Suppression of temporary exploitation permit (2 years validity)

• Suppression of incremenatl royalties, replaced by a fix rate between 12.5% and 15% for crude oil and fix rate between 2.5% and 5% for natural gas

• Royalty on transportation (1500000 x OF /sqkm/year)

• Tax on net profit is indexed on operations profiability and varies between 45% to 60%

• signature bonuses are mandatory

• July 2012 : 9 PSC are to 5 companies

• Dibella 1 and Dallol to Labana Petorleum

• Manga-1, Manga 2 , Aborak and Tenere Quest to International Petroleum

• Djabo 1 to Genmin ltd

• Grein block to Sirius Energy Resources Ltd

• Mandaram 2 to Advantica Gas and Energy Ltd

Goverment • November 2012 Ministry of Mines and Energy of the Republic of Niger issued

new petroleum blocks map

• Six of these blocks are in Murzuq Basin, known as Djado Basin in Niger, Agadez political province:

• Djado 2: 12,920 sq km

• Dissilak 20,030 sq km

• Karam 30,740 sq km

• Tchigai 21,230 sq km

• Twelfth of these blocks are in the Iullemmeden Basin, located on the East of Niger:

• Ader: 31,600 sq km

• Azawak: 28,400 sq km

• Irhazer: 25,630 sq km

• Tadarast: 39,740 sq km

• Talak: 30,380 sq km

• Tarka: 43,700 sq km

• Tegama: 32,800 sq km

• Tounfalis: 38,350 sq km

• Yaris: 31,200 sq km

• Nine of these blocks are in the Chad Basin:

• Achegour: 16,750 sq km – East of the Termit Trough and South of the Seguedine Rift

• Araga: 28,420 sq km - East of the Termit Trough and the Seguedine Rift

• Damagaram: 31,530 sq km – West of the Termit Trough

• Dibella 2: 28,710 sq km - East of the Termit Trough

• Homodji: 33,900 sq km - East of the Termit Trough

• Seguedine: 21,850 sq km - East of the Termit Trough and the Seguedine Rift

• Tafassasset: 22,020 sq km – North of the Termit Trough and West of the Seguedine Rift

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Technical Assestment

Chad Basin

• September 2012 CNPC obliged to submit a formal proposal for the bid og Dibella 2

• Despite the private negotiation between CNPC and Niger Goverment many oil companies submitted application for the block.

• Dibella 2 is located in the southern border with Chad in the East diffa region 28.165 km2

• CNPC wanted to ensure the block after major discovery in Oyou 1 well in Bilma block

• Sonatrack entered the second explorationperiod for its Kafra block. Therefore the compnay has to relinguish 50% of the block. Sonatrack is going to drill an exploration well in 2013.

• CNPC entered the second exploration period of its Tenere block, Tenere Rift. Therefore the company has to relinquish 50% of the block. The relinquished part is a new open block available. The block is 100% operated by CNPC.

Djado Basin

• Helios Oil and Gas is interested in blocks Djado 2 and Djado 3 in Murzuq basin known as Djado basin in Niger

• 4 wells drilled in this area between 1961 to 1964 and 2 wells in 2000 where only one has oil shows

• Paleozoic is nearly 2000m and increases towards north

• Well data suggest that good reservoirs exits in Cambro-Ordovician, Lower Devonian and Visean where Ordovician, Silurian and Carboniferous shales are cap rock

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