West Africa aiming for global supplier status
The region is making headway despite some output disruptions
Despite ongoing conflict throughout West Africa, the region's energy sector continues to make progress toward becoming a leading global oil and gas supplier. According to GlobalData, nearly $194bn will be spent on African oil and gas fields between 2018 and 2025.
Nigeria has struggled for years to resist the threat from militant groups. The attacks are impeding the country's efforts to expand exploration outside the Niger River Delta, in the hope of finding new crude reserves. The threat of violence from several militant groups persists. The Niger Delta Avengers has in the past issued reported threats to Total's Egina oil field, which was scheduled for start-up in 2018. The ultra-deep-water field, situated more than 80 miles offshore, has a forecast production capacity of 200,000 bl/d. The project expects to see 44 subsea wells drilled, in water depths between 4,593 ft and 5,577 ft. The wells will be connected, via umbilicals and risers, to an FPSO that is designed to hold 2.3mn bl of oil.
A JV, led by Nigeria LNG, made progress on its $12bm LNG expansion program in 2018, which is expected to increase the country's LNG capacity as much as 40pc. The company, alongside Saipem, TechnipFMC and Chiyoda Corp., was working to take a final investment decision on by the end of the year. In early July, engineering and design contracts were signed for construction of a seventh facility on the Atlantic coast. The expansion plan is part of the country's efforts to maintain market share and preserve its position as one of the world's top LNG exporters, as it competes with increasing output from Qatar, Australia and the US.
The government of Ghana signed an agreement with ExxonMobil in January 2018, granting the company exploration and production rights for the deep water Cape Three Points Block, a 366,000-acre block in which ExxonMobil is the operator. Ghana reportedly has 21 licensed blocks, 14 of which are in ultra-deep-water territory. Tullow Oil, Anadarko Petroleum, Kosmos Energy and CEF are among the top operating companies in the region.
65pc—the amount of oil in 2018 that Congo Brazzaville aimed to increase production by
One of Cameroon's biggest developments, the $1.2bn Hilli Episeyo LNG project, which started full commercial operation in early June 2018—just three months after first gas was confirmed. The project's production vessel reportedly is only the second floating LNG (FLNG) facility to go on stream worldwide. According to Golar LNG, it is the world's first FLNG vessel to be developed as a conversion project from an LNG carrier. With a production rate of approximately 2.4mn t/yr, it is an important milestone for Cameroon, making it a net gas exporter and the sixth African nation to supply LNG.
A directive by state firm Société Nationale des Hydrocarbures' (SNH), to promote Cameroon's hydrocarbon resources, instigated the launch of a licensing round in 2018, opening eight blocks in the resource-rich Rio del Rey basin and the highly prospective Douala/Kribi-Campo basin.
After Shell divested its onshore oil and gas assets in Gabon in 2017, selling all its interests to Assala Energy for $628mn, Assala is now the second-largest oil producer in the Gabonese Republic. Additionally, the company holds interests in four non-operated fields—Atora, Avocette, Coucal and Tsiengui. Panoro Energy, another major operator in Gabon, has reported successful completion of the field's first development well, DTM-2H, in the offshore Dussafu license.
With substantial oil and gas reserves, the Republic of Congo (Brazzaville) became Opec's newest member in June 2018. Hydrocarbons Minister Jean-Marc Thystère Tchicaya announced plans to boost oil production by as much as 65pc in 2018, largely attributed to the planned start-up of commercial production at Moho North and Banga Kayo, where an additional 140,000 bl/d and 50,000 bl/d will be produced, respectively.
According to GlobalData, Angola will account for approximately 23.8pc of Africa's total capex spending between 2018 and 2025. As Africa's second-largest producer, Angola's oil production comprises approximately 50pc of its gross domestic product and about 92pc of its exports. The country produces about 1.55mn bl/d, which is down from last year's average of 1.67mn bl/d. Angola reportedly is planning a production increase of about 250,000 bl/d by 2020 and is expected to see an increased production level of no less than 1.63mn bl/d in 2019. Eni reported a ramp-up of production at Ochigufu field, in Angola's deep offshore Block 15/06. The field is connected to the Sangos production system, which then connects to the N'Goma FPSO, in the block's West Hub.
Eni reported more success in Block 15/06 during June 2018, announcing a new oil discovery in the Kalimba exploration prospect. The Kalimba-1 NFW well was drilled by the West Gemini drillship in a water depth greater than 1,500 ft. In May, Total reported progress in Angola's Block 17. A final investment decision was taken on the company's Zinia 2 project, off Angola's coast. The project is made up of nine wells that will be tied back to the Pazflor FPSO.