Contents€¦ · New Products & Services ... Dr. Tajudeen Umaru, Dr. Steven Dike, Mrs Lami Ahmed, Chief Pius Akinyelure, Malam Mohammed Lawal and Secretary of the Board, Mrs. Hadiza

Petroleum Africa Issue 3, 2020 3

DEPARTMENTSMoving OnAfrican PoliticsMessage from the EditorDownstream NewsPower & AlternativesMarket MoversAround the World

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ContentsVol. 17 Issue 3

Facilit ies onSouth Sudan’sToors Oil Field

Downstream FocusEquatorial Guinea Turns its Focus to Refiningand Downstream Projects 32

Monthly FocusMozambique Regulatory Update 18

New Products & ServicesPOLYSTOPP® Quick Connect System Increases Safetyand Speed of Gas Distribution Pipeline Isolations

Intertek Launches Remote Video Inspection

Weatherford Production Optimization PlatformDelivers Multimillion-Dollar Savings

Halliburton Launches Real-Time Wireless DepthCorrelation System

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Technology and SolutionsAddressing the Challenge of Corrosion 22

Augmented Reality in Plantweb Optics 24

African FocusSouth Sudan 28

Angola 30

Local ImpactHow Egypt Banks on Renewables to MeetExpected Surge of Energy Demand 26

Africa’s Big FiveSection Highlight

Sonatrach Consortium and Maire Tecnimont Ink EPC for Bir Sebaa

Africa at LargeSection Highlight

Tullow’s Force Majeure Likely to Delay FID on Turkana Project

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Petroleum Africa Issue 3, 20204

MOVING ON

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.

Dr. Maikanti Kachalla Baru, the former group managingdirector of the Nigeria National Petroleum Corp.(NNPC), unexpectedly passed away. Baru died on May29 after a brief illness; he was only 60 years young.Baru, an engineer, served as the MD of NNPC from July

4, 2016, to July 7, 2019. He also served previously served as the groupgeneral manager of National Petroleum Investment Management Services.

Petroleum Africa sends its condolences to his family, friends, and supportersfor the loss of such a great man and larger than life character.

Maikanti Kachalla

Weatherford International announced that KarlBlanchard, EVP and COO, will assume the roleof Interim CEO, reporting directly to the boardof directors, until a permanent president and CEOis appointed. In addition, Christian Garcia, EVPand CFO, has decided to leave the companyfollowing the filing of the company’s secondquarter financial results on August 5. Thecompany will announce Mr. Garcia’s successorat a later date.

GP Global announced the appointment of fourexperienced industry professionals. Newlyappointed to further develop oil trading in itsUAE office is Maleek Mostapha, a seasoned

bunkering expert with over seven years ofexperience in the field, who has joined the groupas Senior Bunker Trader. Neethu Varghese hasalso joined the UAE office as Bunker Trader,bringing with her a wealth of trading expertise.

The new appointments in GP Global’sSingapore office include Sascha Khan Lulla as

Bunker Trader, bringing with him over sevenyears of trading experience, and Travis Tey asBunker Trader, with over eight years of tradingexperience.

Sonatrach’s chief Toufik Hakkar terminated anumber of key executives over his first fivemonths on the job. Those losing their positionsinclude Faiz Zane, head of engineering andmanagement; Mohamed Hadj, human resourcesmanager; Toufik Hamdane, head of Sonatrach’spartnerships division; and Farid Ghezali, formervice president in charge of strategy. It was furtherreported that Hadj Djilali Abouda resigned hisposition as vice president, finance.

Tendeka’s VP for Europe,Russia, CIS & Africa,Gillian King, has joinedthe board of the Oil & GasTechnology Center(OGTC). In her newposition, Gillian will workwith CEO Colette Cohenand new Chair, Martin

Gilbert to shape the overall strategic directionand long-term success of the OGTC.

Gillian King

In late May OPECwelcomed a new ministerto its ranks representingVenezuela, HE Tareck ElAissam. He previouslyserved the country as itsMinister of Industries andNational Production andMinister of the Interior and

Justice. Further, Amir Hossein Zamaninia,Iran’s Deputy Oil Minister, was named asIran’s OPEC Governor, replacing HosseinKazempour Ardebili who died in early May.

Tareck El Aissam

N e p t u n e E n e r g yannounced that MehdiBouguetaia will be joiningthe company to take on therole of Algeria ManagingDirector, based in Algiers.Mehdi joins Neptune fromShell where he mostrecently held the position

of Technical Support and Subsea OperationsGeneral Manager with the company’sRashpetco JV business in Egypt.

Mehdi Bouguetaia

BP Southern Africahas a new CEO, TaeloMojapelo. She succeedsPriscillah Mabelane whowas the first woman inSouth Africa’s oil historyto head up a multinationalcompany. Mojapelo haspreviously held several

leadership roles in multinational companiesincluding, Mondelez International, Kellog’sand DHL.

Taelo Mojapelo

Mozambique’s nationaloil company, EmpresaN a c i o n a l d eHidrocarbonetos (ENH),has secured a newchairman, Estevao Pale.He comes to ENH fromN c o n d e z i E n e r g yLimited where he served

as a board member and non-executive director.

Estevao Pale

Nigerian President Mohammadu Buhariapproved a new board of directors for NNPC.The new members are the Hon.Minister ofState for Petroleum Resources, TimipreSlylva who doubles as the Alternate Chairmanof the Board, Mallam Mele Kolo Kyari,GMD of NNPC, Senator Magnus Abe,Dr. Isah Dutse, Permanent Secretary Ministryof Finance, Dr. Tajudeen Umaru, Dr. StevenDike, Mrs Lami Ahmed, Chief PiusAkinyelure, Malam Mohammed Lawaland Secretary of the Board, Mrs. HadizaCommassie.

Source: Federal Ministry of Information and Culture


YOUR company seen here – just $400Write [email protected] today.

Burundi Elects New PresidentVoters in Burundi turned out in good numbers tocast their ballots to replace the country’s long-reigning, autocratic president. Burundi’s electioncommission declared the governing party’scandidate, Evariste Ndayishimiye, the winner ofthe country’s presidential election amidaccusations of irregularities by the leadingopposition challenger.

Ndayishimiye, a retiredarmy general, won 68.72percent of the votes. Themain challenger, AgathonRwasa , r epo r t ed lygarnered 24.19 percent,according to the electoralcommission. There wasa turnout of 88 percent.The vote was preceded

by political violence, including the arrest, tortureand murder of opposition activists, according toa local rights group, and it was the first competitivepresidential election in Burundi since a civil warerupted in 1993.

UN and US Supervise Negotiations forResumption of Libyan Oil ProductionLibya’s National Oil Corp reported that therehave been ongoing negotiations to resume oilproduction over June between the GNA, NOCand regional countries, under the supervision ofthe UN and the US. The corporation is hopefulthat those regional countries will lift the blockadeallowing NOC to resume its vital work for thebenefit of all the Libyan people.

“NOC is determined that the agreement willguarantee transparency and that oil revenues willachieve social justice for all Libyans. Thecorporation also intends the agreement willinclude solutions to protect the oil facilities andmake sure they are never used as a military targetor a political bargaining chip again,” a statementon NOC’s website read.

Top Terrorist Leader Killed in MaliThe Minister for the French armed forces,Florence Parly, announced in early June thatFrench armed forces, with the support of theirpartners, killed the emir of the Al-Qaida in thelands of the Islamic Maghreb (AQIM),Abdelmalek Droukdal, and several of hisclose collaborators, during an operation innorthern Mali.

Droukdal served as the emir of AQIM and wasinvolved in all aspects of the organization toinclude financing, planning, and the facilitationand execution of terrorist attacks. The operationpermanently eliminated the most senior decision-maker of AQIM and the likely architect of theSahel-based jihadist movement.

Insurgents Killed in MozambiqueAccording to the Mozambican Ministry ofInterior, security forces killed around 50 insurgentsin the northern Cabo Delgado region that hasbeen plagued by violence for several years.

“On May 13 the insurgents were surprised byour forces on a road that connects Chinda toMbau ... in the confrontation 42 terrorists werekilled,” Interior Minister Amade Miquidade saidat a news conference.

He added that security forces had killed anothereight insurgents who were attacking the Quissangadistrict, also in Cabo Delgado.

Initial attacks were claimed by a group knownas Ahlu Sunnah Wa-Jama although recently,Islamic State has claimed responsibility for anumber of attacks.

New Evidence of RussianAircraft Active in Libyan AirspaceAccording to U.S. Africa Command, Russianaircraft delivered to Libya in late May are beingactively flown in Libya. Africom stated Russia’s

introduction of manned, armed attack aircraftinto Libya changes the nature of the currentconflict and intensifies the potential of risk to allLibyans, especially innocent civilians.

“These Russian aircraft are being used to supportprivate military companies (PMCs) sponsoredby the Russian government. U.S. AfricaCommand has photographic evidence of a Russianaircraft taking off from al-Jufra, Libya. A MiG-29 was also photographed operating in the vicinityof the city of Sirte, Libya,” a release on Africom’swebsite stated.

“Russia’s sustained involvement in Libyaincreases the violence and delays a politicalsolution,” said U.S. Marine Corps Brig. Gen.Bradford Gering, USAFRICOM director ofoperations. “Russia continues to push for astrategic foothold on NATO’s southern flank andthis is at the expense of innocent Libyan lives.”

In late May, USAFRICOM reported that at least14 MiG-29s and several Su-24s were flown fromRussia to Syria, where their Russian markingswere painted over to camouflage theirRussian origin. These aircraft were then flowninto Libya in direct violation of the United Nationsarms embargo.

“We know these fighters were not already inLibya and being repaired,” said Col. Chris Karns,director of USAFRICOM public affairs. “Clearly,they came from Russia. They didn’t come fromany other country.”

AFRICAN POLITICS

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It looks like four months of the Covid-19 pandemic and weak oil demand has provided theimpetus for many oil companies to advance plans toward a sustainable energy future. Newson the E&P front has indeed become sparse since March, however, announcements on newcorporate strategies for greening operations and reducing carbon output are becoming the newnorm, from European quarters at least.

The European oil giants - BP, Eni, Shell, and Total – have all announced over the previousfew months, their intentions to become “Net Zero” energy companies by 2050. They havealso, over time, begun rebranding to be known as energy companies rather than oil companies.

In April, Shell became the largest company to commit to being a Net Zero company by 2050.CEO, Ben van Beurden, explained the decision succinctly: “Society’s expectations have shiftedquickly in the debate around climate change. Shell now needs to go further with our ownambitions, which is why we aim to be a net-zero emissions energy business by 2050 or sooner.Society, and our customers, expect nothing less.”

Total, in May, announced its ambition to get to net-zero emissions by 2050, together withsociety, across its global production chain and energy products used by its customers. It alsoannounced that it has joined the Getting to Zero Coalition to support the maritime industry’sdecarbonization by collaborating with companies across the maritime, energy, infrastructure,and finance sectors.

Eni has gone bolder, launching a new business structure to be a “leader in the energy transition.”The new Eni will have two business groups – Natural Resources and Energy Evolution. TheNatural Resources division will have the objective of reducing its carbon footprint by scalingup energy efficiency, expanding production in the natural gas business, and focusing its actionson the development of carbon capture and compensation projects. The Energy Evolution sidewill focus on the evolution of the businesses of power generation, transformation, and marketingof products from fossil to bios, blue and green. In particular, it will focus on growing powergeneration from renewable energy and biomethane.

BP, the first major out of the gate to commit to Net Zero, admits it does not have all the detailsworked out, but says it will create four divisions: production and operations; customers andproducts; gas and low-carbon energy; and innovation to help it reach its target. The firm hasalso said it will provide more details in September and that its strategies will evolve over time.

While not a super major, Spain’s Repsol beat them to the punch, announcing its net-zerocommitment late in 2019, laying out goals of a 10% reduction by 2025 and 20% by 2035along the way to 2050’s 100%. Further, it is noteworthy to mention that Repsol was the firstoil company to recognize the 1997 Kyoto Protocol. And other European independent oilcompanies are moving forward to become Net Zero as well, including Lundin Petroleum ofSweden which has given itself a tall target of 2030 to realize carbon neutrality.

So, the Europeans have shown up, now it looks like the hands of the American supermajorswill be forced. Chevron and Exxon have sidestepped the Net-Zero commitment, opting forindependent carbon emission reduction targets instead. However, in today’s green climate,public perception and shareholder pressure will demand they come to the table more fully.Sooner, rather than later.

Now on to this issue…be sure to catch the latest updates out of Angola and Gabon in theAfrica Focus section. Meanwhile, although upstream projects are not at the top of the list forEquatorial Guinea in light of Covid-19, the country does have big downstream plans that itis pressing on with, read more in Downstream Focus. And finally, Technology & Solutionssection looks at how Emerson has integrated augmented reality into Plantweb optics software,enhancing remote collaboration and workforce effectiveness. As always, your comments andsuggestions are welcome and can be sent to [email protected].

Dianne SutherlandChief Editor

Petroleum Africa – Issue 3, 20206

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AFRICA BIG F IVE

United Oil & Gas High onEl Salmiya-5 Well ResultsUnited Oil & Gas (UOG) provided an update onthe El Salmiyah-5 development well on the AbuSennan concession in Egypt, in which UOG holdsa 22% working interest. The company reportedthat early analysis of logging and testing suggeststhat the well significantly exceeded pre-drillestimates, further building on the success of thelast 12 months which has seen UOG’s share ofproduction increase significantly.

El Salmiyah-5 was spudded on February 3, andreached total depth of 4,400 meters MD (3,911meters TVDSS) on April 17. The well wastargeting previously undrained reservoirs of theEl Salmiyah Field, with the primary focus beingthe Kharita Formation, and secondary objectivesin the Abu Roash C and Abu Roash E. Net paywas encountered in all of the targeted intervals,totaling in excess of 120 meters for the well andexceeding pre-drill expectations significantly.The main Kharita target interval was encounteredsome 16 meters shallow to prognosis, indicatinga larger than expected undrained area updip ofthe existing wells in the field. This was furthersupported by the encouraging well-test results,which achieved flow rates of 4,100 bopd, with afurther 18 mmscf/d gas (c. 8,700 boepd in total).

With further testing planned, it would bepremature to draw any further conclusions on theoil volumes associated with the well. United’sexpectations are that although the well mayinitially be brought onstream close to the headlinetest rate, in the longer-term, it is likely to bechoked back to lower levels for sustainableproduction through the existing facilities.Production from El Salmiyah-5 is expected togenerate solid operating margins even at low oilprice levels due to Abu Sennan’s low operatingcosts of around $6.5/bbl.

Nigeria’s MarginalField Bid Round UnderwayNigeria’s Department of Petroleum Resources(DPR) announced the commencement of the 2020Marginal Field Bid Round. The bid round is opento indigenous companies and investors interestedin the exploration and production business in theWest African country.

A total of 57 fields located on land, swamp andshallow offshore terrains are on offer. The exercise,

which will be conducted electronically, willinclude expression of interest/ registration, pre-qualification, technical and commercial bidsubmission and bid evaluation.

According to the DPR guidelines on the 2020 oilbid round, payment by interested bidders shallinclude non-refundable chargeable fees as follows:application fee of N2 million per field, bidprocessing fee of N3 million per field, data pryingfee of $15,000 per field, data leasing fee of$25,000 per field, competent persons report of$50,000 and $25,000 for field specific reports.In total, the fees amount to $115,000 in statutoryfees and another N5 million in local currency.

Interested parties can visit the DPR dedicatedportal – marginal.dpr.gov.ng – to access theGuidelines for the Award and Operations ofMarginal Fields in Nigeria 2020, and therequirements for participation.

Wellhead Burns on Nigeria’s OML 95According to Nigeria’s National Oil SpillDetection & Response Agency (NOSDRA), thewell head of the Ororo-1 on OML 95 caught fireon May 16. Guarantee Petroleum engagedHaliburton and Chevron Nigeria Limited to assistit in extinguishing the fire. NOSDRA estimatedit would take at least six weeks to extinguish theinferno on the Grace-1 hydraulic workover rig.

A Joint Investigation was carried out because ofthe nature of this emergency situation, NOSDRAreported. Thankfully, there were no reportedinjuries from the explosion.

Transglobe Updates Egypt OpsTransglobe Energy reported that on its WesternDesert – South Ghazalat asset (100% WI) thatthe SGZ-6X well continued to produce from theUpper Bahariya reservoir at a rate restricted to afield estimated 200 – 250 bopd of light andmedium crude to evaluate the well, manage thereservoir and optimize the separation of oil, gasand water.

On its 100% held Eastern Desert asset, thecompany said there had been no drilling activityduring Q2 2020, consistent with its revised 2020budget. Discussions with the joint ventureoperating partner continued to further reduceoperating expenditures. Material operating costreductions in Egypt require the assistance of theJV partner, the Egyptian General PetroleumCorporation (EGPC).

Despite restrictions on travel, constructivenegotiations with EGPC to amend, extend andconsolidate the company’s Eastern Desert

concession agreements have continued throughoutthe quarter.

Business continuity plans have been implementedin all of Transglobe’s locations and operationscontinue as normal. The company has had threereported cases of COVID-19 in its joint ventureoperating partner in Egypt, which were managedaccording to established company and localnational quarantine guidelines. All three haverecovered and returned to work with no onwardinfection spread reported.

Sonatrach Consortium andMaire Tecnimont Ink EPC for Bir SebaaA consortium made up of Sonatrach and its twopartners PTTEP and PVEP signed an Engineering,Procurement & Construction (EPC) contract forthe completion of a second oil treatment train(CPF) at the Bir Sebaa field, 40 km from Algeria’sHassi Messaoud operations, with Italian companyMaire Tecnimont.

This project, whose contract was awarded inMarch 2018 following a call for tenders,constitutes the second phase of development ofthe Bir Sebaa field which will allow the processingof an additional production of 20,000 barrels perday (bpd) of oil in order to increase the productionof these fields up to 40,000 bpd, according to apress release issued by the company. Under thisEPC contract, Maire Tecnimont will providedetailed engineering studies, the supply ofequipment and materials, construction as well ascommissioning tests.

The project involves the construction of an oiltreatment train, associated gas compressionunit, gas lift unit, water injection unit formaintaining pressure, a third turbo-generator(18 MW), as well as the connection of 33 wells,19 of which are oil producers and the remaining14 being water injectors.

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Angola Delays Bid RoundAngola’s National Agency of Petroleum, Gas andBiofuels (ANPG), the country’s nationalconcessionaire and holder of mining rights forthe prospecting, research, evaluation, developmentand production of liquid and gaseoushydrocarbons, announced that the schedule ofthe planned bid round will see a delay due to theeffects of the COVID-19 pandemic.

“According to the Schedule of Activities of theBidding Process 2020, all conditions were createdso that by the end of May, the announcement ofthe intention to launch the public tender wasmade, pursuant to Presidential Decree No. 86/18,of 02 April. However, due to the current economicconstraints caused by the COVID-19 pandemic,this date may undergo minor adjustments,” astatement on the state entity’s website read. ANPGwent on to stress that despite the adverse situation,“the objectives of previously scheduled bids havenot changed. The need to streamline and continuepetroleum operations in the country remains valid,with emphasis on exploration activities.”

ANPG will publish information on the evolutionof the process on its portal and in the nationaland international media, as well as theannouncement of the intention to launch the publictender, pursuant to Presidential Decree No. 86/18,of April 2.

Previously, ANPG announced that the DataPackage for blocks for oil exploration in theTerrestrial Basins of the Lower Congo (CON1,CON5 and CON6) and the Kwanza (KON5,KON6, KON8, KON9, KON17 and KON20)was available.

Libya’s Erawin FieldDevelopment Plan on the BooksOn June 11, 2020, the National Oil Corporation(NOC) and Zallaf Libya Company for Exploration

and Production of Oil and Gas (Zallaf) held ameeting where a series of long-term tests for thefield in order to optimize the field developmentplan was proposed. Both NOC and Zallaf agreedin principle on the long-term testing plan. Issuesat hand include the field location and addressingsecurity challenges and logistics difficulties. Otherconsiderations are the impacts of COVID-19 andthe war in Tripoli.

At the end of the meeting, it was decided thatmore meetings will be held for the NOC’sspecialists and Zallaf Company for furtherclarification and strategy that guarantees the bestresults out of this long-term testing plan.

OXY gets the OK to MaintainAnadarko Contract in AlgeriaAlgerian authorities have given OccidentalPetroleum Corp. (OXY) the go-ahead to maintainAnadarko’s contract in the North African country,according to a release on state firm Sonatrach’swebsite. Algeria had previously blockedOccidental Petroleum’s deal to sell Anadarkoassets in the country to France’s Total followingOccidental’s acquisition of the US-independent.Occidental Petroleum has informed the Ministryof its new strategic approach and its “commitmentto continuing Anadarko Algeria Corporationactivities in Algeria,” and it will seek newpartnership opportunities, the statement said.

Zenith Announces Participation inNigeria’s 2020 Marginal Field Bid RoundZenith Energy announced its participation, in thecapacity of technical and financial partner to aNigerian registered energy company, in the 2020bid round for marginal oil and gas fields organizedby the Nigerian Department of PetroleumResources (DPR).

Further, the company has also entered intonegotiations with two pan-African financialinstitutions for a loan facility that will be used tofund the acquisition and development of Zenith’sgrowing portfolio in West Africa.

Andrea Cattaneo, Chief Executive Officer,commented: “Among the 57 Marginal Fieldsincluded in the 2020 Bid Round, there are specificassets which are particularly appealing to Zenith,especially on account of their compatibility withour development objectives. Indeed, the near-term production potential of certain assets isexpected to facilitate the achievement of financingagreements to support our expansion. We expectthe potential award of a Marginal Field, followingthe 2020 Bid Round process, to happen withinsix months of bid submission.”

El Feel Oilfield OfflineDue to Security SituationFollowing the restart of production at the ElFeel oilfield, just a few days later production atthe field came to a halt again. According toNational Oil Corp (NOC), the commander ofthe “Khalid bin al-Walid Battalion”, YousifHassan al-Tabawi, coerced workers at El Feeloilfield to stop production at the field again,only a few days after the Hamada valvewas reopened.

NOC charges this is a serious criminal actagainst the Libyan people and its interests. “Itdemonstrates again the failure of the PetroleumFacilities Guard (PFG) to carry out their legalduties of protecting the oil sector’s facilities andworkers. The PFG has become like a militia thatcarries out orders of illegitimate leaders in orderto serve foreign interests.

“NOC again warns that it will prosecute criminalsand take all legal procedures against them.Whoever works to destroy the economy and thefuture of the country must pay the price oftheir crimes.”

A similar situation was seen over the same timeframe at the Al-Sharara oilfield which beganproduction only to stop again a few days laterdue to militant activity.

The Chairman of the Board of Directors of NOC,Eng. Mustafa Sanalla, met with board membersto discuss the situation. During the meeting, thesafety of workers and the current securityconditions in the oil field of Al-Sharara werediscussed in light of the deterioratingsecurity conditions at the field and the entry ofdozens of armed men with weapons andammunition, some of them were intoxicated, ina flagrant violation of the precautionary measuresof the Corona pandemic. Also, developmentswere discussed regarding the suspension ofproduction operations carried out under armedgunmen, under command of the so-called166 Battalion.

Sonatrach to Adapt GasStrategy to Face Global CompetitionAlgerian Minister of Energy Mohamed Arkabannounced that state oil firm Sonatrach is currentlyworking on adapting its marketing strategy in thegas sector to the demands of increasing marketcompetition. “Sonatrach is changing itscommercial strategy” in light of changes in theglobal market, Arkab said in a press statementon the sidelines of a plenary session at the Councilof the Nation.

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Further, Arkab stated, “Several countries injectlarge quantities of gas, in particular with thedevelopment of the production of shale gas andliquefied gas … the world changes and so dowe.” He assured that Algeria aimed to “remainthe preferred supplier” of European countries andpointed to the pipelines as the means forguaranteeing direct connection to customers asthis is an advantage the county has over manyother nations in order to economically supply itsEuropean customer base.

Neptune Wraps-UpSeismic Shoot Offshore EgyptNeptune Energy announced that it has successfullycompleted an ocean bottom nodes (OBN)multiclient survey in the North West El Amalblock, offshore Egypt, delivering promising resultsfor further analysis. The project, prefunded byNeptune, was carried out by WesternGeco, theseismic and geophysical data solutions divisionof Schlumberger, under a contract with theEgyptian General Petroleum Corporation (EGPC),sponsored by the Egyptian Ministry for Petroleumand Mineral Resources. WesternGeco acquiredthe survey using third-party vessels.

The survey employed innovative OBN technologyto overcome the challenge of acquiring improvedimaging in the complex salt geometries of theGulf of Suez. It was the first ever OBN seismic

survey to be conducted in Egypt and the mostdetailed survey of the block since the firstacquisition in 1988, providing an in-depth dataset for processing, image analysis, and planningfor potential exploratory wells in the future.

The North West El Amal offshore concessioncovers 365 sq km and is located in the centralpart of the Gulf of Suez, approx. 42 km south ofRas Gharib and 105 km north of Hurghada.Neptune was awarded the exploration license inFebruary last year, including the acquisition of100 sq km of 3D seismic data.

The project involved placing large numbers ofautonomous sensors on the seabed to acquireseismic data, then retrieving them for analysis.The process acquires more detailed data thanstandard technologies and is less sensitive toweather conditions which can impact traditionalseismic survey vessels.

Cheiron Sees First Oil fromthe GNN Discovery in Gulf of SuezCheiron announced that the GNN-4 well inEgypt’s Gulf of Suez, which was drilled toappraise the recent GNN oil discovery, has beencompleted and successfully tested at initial ratesof over 2,000 bopd. The well was drilled as ahigh angle wellbore from the existing Geisum Dplatform and has been placed on long termproduction using the existing field infrastructure.The discovery, which contains an estimated 260MMbbls of oil in place, is located on the Geisumand Tawila West Concession in which Cheiron(through its PICO GoS affiliate) holds a 60%participating interest and operatorship and Kufpeca 40% participating interest.

The Concession is managed by a Joint OperatingCompany owned by the Egyptian GeneralPetroleum Company, Cheiron and Kufpec andcalled PetroGulf Misr which is technicallysupervised by South Valley Egyptian PetroleumHolding Company. The Concession contains themature Geisum oil field (with 32 active wells,extensive offshore infrastructure and onshoreplant at Zeit Bay) which has been on productionsince the 1980s.

The GNN-4 well will be followed by two furtherwells to be drilled from the D platform in thesouthern area of the discovery. Subsequently, thedevelopment focus will shift to the northernarea of the discovery where additionaldrilling is planned, along with the tie-back ofthe GNN-3 well for early production. The fullfield development will leverage the existingGeisum facilities to accelerate production andminimize costs and will also involve theinstallation of new platform and pipelineinfrastructure.

The discovery is the first to be made in the Nukhulformation in the Geisum area and will open upfurther exploration potential, both within theConcession and in the neighboring acreage. Itcomes after the implementation of anextensive, multi-year exploration anddevelopment campaign by PICO GoS and itspartners, designed to maximize the economicreserves recovery from the Concession. From amore regional perspective, the oil find hasagain demonstrated that, while the Gulf ofSuez is a relatively mature hydrocarbon province,the region still has significant remainingexploration potential.

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Following Tullow Oil’s May announcement thatit would declare force majeure on its Turkana oildevelopment in northern Kenya, hopes for a finalinvestment decision in 2020 have beenconsiderably dimmed. FID had previously beenpushed back from 2019 to 2020.

Besides the low-price oil environment and theimpacts of the Covid-19 pandemic, Tullow is alsolooking to farm-down its stake in the project asit has been hit hard over the last year withproduction issues arising on its Ghana projectand less than stellar drilling results in Guyana,resulting in a greatly devalued share price leavingthe company with less expendable cash. Tullowhas also faced in-country challenges such asenvironmental, community and security concerns,as well as the impacts of January flooding on theroads meant to support the early oil productionpilot scheme.

Speaking during the “Moving Kenya Forward:Oil Production and New Exploration UnderCOVID-19” webinar hosted by Africa Oil &Power, several regional industry experts castdoubt on the FID on the Turkana project beingreached this year.

Commenting on the topic, Brian Muriuki,Managing Director & Country Chair, Royal DutchShell Ghana, said “we are still waiting to seegovernment response to the force majeure, but

there will be clock stopping, commercial andtechnical. Clearly everything will shift includingFID and project execution.”

Toks Azeez, Sales and Commercial Director forSub Saharan Africa, Baker Hughes, concurred.“We have to recalibrate our plans including verydetailed discussions and negotiations with Tullow.FID was meant to come by the end of this yearbut perhaps it will be next year in light of thisforce majeure.

Doris Mwirigi, Chief Operating Officer, EnergySolutions Africa says the implications for the

Turkana project depend on the clause thatTullow is invoking. “We are waiting to heargovernment’s response and what Tullow actuallycited as their circumstances and what the clauseis in the PSC.”

Hon. Dr. Elly Karuhanga, Chairman, The UgandaChamber of Mines & Petroleum believes it willbe difficult to reject the force majeure in any case“as times are difficult even without Covid andlow oil prices,” referring to other on-the-groundchallenges in the region. “Kenyans should remainhopeful though as the oil is in the ground there,”he added.

AFRICA AT LARGE

New PGS Seismic and Well Datafor Extended Gabon License RoundA recent expansion of the Gabon MegaSurveycoverage has significantly increased access to 3Dseismic over the 35 open blocks on offer. TheDirection Generale des Hydrocarbures(DGH) and PGS now offer over 65,000 sq. kmof 3D seismic and over 21,000 km of 2Dseismic data.

An extension to the tender submission deadlinefor the Gabon 12th Offshore Licensing Roundprovides further opportunity to integrate new datainto evaluations of open blocks.

The Gabon MegaSurvey is a cost-effective toolfor regional evaluation and visualization of playsand migration pathways. In addition to the seismicdata, well data is now available for 167 wellswithin the MegaSurvey area, to support theevaluation of the blocks on offer. Value-addedcomposite logs used in conjunction with theregional seismic dataset will help the assessmentof prospectivity and play evaluation.

Sangomar On-Track for First Oil in 2023Woodside addressed recent media reports statingthat Senegal has been forced to delay its first oiland gas projects by up to two years because ofthe COVID-19 pandemic. Woodside reiteratedthat first oil from the Sangomar FieldDevelopment Phase 1 remains on track for 2023,in line with previous guidance.

Woodside and its joint venture partners took anunconditional final investment decision for theSangomar Field Development Phase 1 andcommenced execution phase activities inJanuary 2020.

Since then, Woodside has taken early action toproactively manage the emerging impacts ofCOVID-19 on the supply chain and projectschedule. “We are working with projectcontractors, the Government of the Republic ofSenegal and our joint venture partners tooptimize near-term spend while protecting theoverall value of the investment and deliverfirst oil in 2023,” Woodside stated.

TGS Completes Vast Jaan 3DSeismic Program Offshore NW AfricaTGS announced the completion of its flagshipJaan 3D seismic survey covering the MSGBCBasin in NW Africa acquired in partnership withPGS and GeoPartners. Comprising over 28,000sq km, this vast survey spanning offshore Senegal,The Gambia, AGC and Guinea-Bissau has beenspecifically designed to map the CretaceousPalaeo Shelf-Edge Trend (PSET) and to shedlight into the untapped Jurassic potential. Thishas been the setting for the FAN and SNEdiscoveries, Africa’s most successful play ofrecent times.

Tullow’s Force Majeure Likely to Delay FID on Turkana Project

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AFRICA AT LARGE

Jaan 3D consists of both newly acquired (over12,000 square kilometers) and recentlyreprocessed seismic surveys, processed andharmonized to create a seamless 3D PSTM andPSDM volume which allows explorers to obtaina holistic understanding of this prolific basin andits unique geological features of the shelf edgetrend across borders. It is also the current settingfor anticipated and ongoing bid rounds, includingthe Senegalese 2020 License Round, which offersacreage on-trend with the FAN and SNEdiscoveries. Meanwhile, in The Gambia, Jaan 3Dcovers significant prospectivity similar to theFAR/Petronas targets in adjacent blocks.

Rune Eng, Executive Vice President, Global atTGS, said, “Recent and significant success in theMSGBC Basin demonstrates the importance ofthe province in terms of exploration not only inAfrica but also worldwide. Learning from thesegiant discoveries and cross-border explorationsuccess, the Jaan 3D survey has been specificallydesigned to highlight key play fairways andprovide a vital exploration volume to enable E&Pcompanies to unlock the next giant discovery.”

In addition to the Jaan 3D volume, the TGSsubsurface data library in the MSGCB Basinincludes over 82,000 km of 2D seismic and afurther 16,000 square kilometers of 3D seismic(including newly acquired deepwater The Gambiaand Senegal 3D surveys). This extensive andexpanding seismic footprint is complemented bywell data products and a vast 114,000 squarekilometers Multi-Beam and Seafloor Sampling(MB&SS) survey covering Senegal toGuinea-Bissau.

Equatorial Guinea AdoptsNew Petroleum RegulationThe Ministry of Mines and Hydrocarbons (MMH)of the Republic of Equatorial Guinea hasannounced the adoption of the new Regulationof Petroleum Operations, Regulation No. 2/2020of June 15th, 2020. The new Regulationmodernizes Equatorial Guinea’s existingregulatory framework and is intended tomaintain the country’s attractiveness forforeign investors.

It notably covers key matters such as the extensionof the productive life of mature fields thoughmechanisms allowing operators to generate greatervalue from these assets; the exploration ofmarginal and onshore fields along withinvestments in deep and ultra deep water acreages;the monetization of gas and the development ofthe petrochemicals industry, along with furtherintegration of the national workforce and localcompanies across the value-chain.

The new Regulation is seen as a pillar ofEquatorial Guinea’s recovery strategy post Covid-19 and clarifies several aspects of petroleumoperations in the country. It also comes asEquatorial Guinea pushes for additional localparticipation across the value-chain and isdeveloping several gas monetization anddownstream projects. The Regulation notablystipulates that refining, petrochemicals andcommercialization activities can be realizedunder a specific license granted by the MMH(Article 93) on the basis of technical and financialcapabilities notably.

It also strictly prohibits gas flaring, except undervery specific circumstances, and stipulates thatField Development and Production Plans mustalways be designed in such a way as to allow theuse, conservation or commercial exploitation ofassociated gas (Article 149). It also clarifies newrules and frameworks on exploration andproduction from mature and marginal fields,defining the former as a field that has enteredinto decline and is no longer economically viable,and the former as a field that has produced 90%of its proven hydrocarbons reserves (Article 41).Such fields will benefit from 10-year contracts,which can be renewed every five years after studyand assessment by the MMH.

Aker Energy Working onSolution for Pecan Field DevelopmentAker Energy Ghana Limited (Aker Energy)reaffirmed its commitment to finding a solutionthat will allow for the commencement of a phaseddevelopment of the Pecan field offshore Ghana.

“In a time when most other E&P companies areputting development projects on the shelf due tothe COVID-19 situation and historic low oilprices, Aker Energy and our partners, Lukoil,Fueltrade and GNPC, are working closely withthe government of Ghana, and are activelypursuing a development concept where we cancommence phase one of a phased developmentof the Pecan field,” said Håvard Garseth, CEOof Aker Energy. “Although we have an alteredtimeline, we are on our way to finding adevelopment concept with a breakeven price thatis sustainable and resilient also in a low oil priceenvironment.”

In March, Aker Energy announced that a finalinvestment decision (FID) for the Pecan fielddevelopment project had been placed on hold,postponing the project. While no new date hasbeen set for the FID, the company is workingactively to confirm the feasibility of a phasedPecan field development by executingconceptual studies.

The phased development of the Pecan field andthe utilization of a redeployed FPSO vessel willsubstantially reduce the CAPEX and, hence,reduce the breakeven cost. In addition, it willincrease the possibility of reaching acommercially feasible project that will allow foran investment decision. Aker Energy andpartners are currently assessing several FPSOcandidates for redeployment, and the finalselection will be based on technical capabilitiesand cost.

Aker Energy Ghana Ltd., a subsidiary ofNorwegian-based oil exploration and productionfirm, Aker Energy AS, is the operator of theDeepwater Tano Cape Three Points (DWT/CTP)Petroleum Agreement, with a 50% participatinginterest in he license. Its partners are LukoilOverseas Ghana Tano Limited (38%), the GhanaNational Petroleum Corporation (GNPC) (10%)and Fueltrade Limited (2%).

SDX Updates Plansfor Morocco’s Lalla MimounaSDX Energy reported that post-drill analysis ofthe LMS-2 well at Lalla Mimouna, (where itholds 75% and is operator) in Morocco hasidentified similarities with the LAM-1 discoverymade by the previous operator of theconcession which flowed gas and condensate in2015. Subject to successful tes t ing,management estimates that LMS-2 could containc.1.5 Bcf and has the potential to de-risk afurther 6.0 Bcf in separate compartments withinthe same feature.

Management also estimates that a further 3.4 Bcfof close by prospective resources will be de-risked if LMS-2 tests successfully, increasing theoverall prospective resource potential to 10.9 Bcf.LMS-2 will be tested after the COVID-19restrictions in Morocco enable perforationand testing crews to re-enter the country. Thecompany hopes that this will be late Q3/earlyQ4 2020.

In addition to the 10.9 Bcf of prospective resourcesthat could be de-risked by LMS-2, managementhas identified a further 25.5 Bcf of prospectiveresources in multiple prospects across theconcession.

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PGS Releases New Multi-AzimuthGeoStreamer 3D for Cote d’IvoirePGS announced that it has released its new multi-azimuth broadband seismic survey covering 900sq km that provides increased resolution andsharper imaging of prolific Upper Cretaceousplays in Côte d’Ivoire Block CI-706.

Recently completed final depth processing hasimproved illumination of the block, adding asecond azimuth to existing GeoStreamer data.The latest north-south acquisition, which coversthe majority of the block, was processed with theunderlying east-west-acquired data. The combinedazimuths benefit from the GeoStreamer broadbandfrequency bandwidth and a comprehensive depthimaging flow.

The combination of two data azimuths has resultedin increased resolution of complex faulting in thesyn-transform section, to enable a greaterunderstanding of the distribution of Albiansandstone targets hosted in tilted fault blocks.The imaging of the prolific Upper Cretaceous

play is also improved, with a clearer delineationof turbidite channel and fan complexes.Heightened imaging of the geomorphology ofstratigraphic pinch-out traps can also reduce therisks associated with hydrocarbon migration andtrap integrity.

A further 7,000 sq km of GeoStreamer broadbanddata will be available in July 2020.

Renaissance Oil Signs LoIfor Vast Botswana Acreage licenseRenaissance Oil, traditionally a Mexico-focusedplayer, has entered into a binding letter agreementto acquire an option for a 50% working interest,in all rights from surface to basement, in a largepetroleum license, comprising 2.45 million acresin the Kavango sedimentary basin, in Botswana.

Pursuant to the Letter of Agreement, a privatecompany controlled by Mr. Steinke, CEO ofRenaissance, has agreed to assign its interest ina farm-out option agreement with a subsidiary ofReconnaissance Energy Africa (ReconAfrica),for C$100,000 cash and the issuance of 30 millioncommon shares of the company at a deemed priceof $0.04 per share (using the 30 day volumeweighted trading average) for an aggregatepurchase price of C$1.3 million.

The Option Agreement will provide Renaissancewith the option to acquire a 50% working interestin the License, exercisable at any time for up to

a period of 36 months upon: (i) payment of C$1M,if exercised within 18 months, or C$1.5 M ifexercised after 18 months; and (ii) the approvalof the Botswana Department of Mines andMinistry of Mineral Resources, Green Technologyand Energy Security.

“The option will provide Renaissance with animportant and potentially high impact oil and gasplay, through the opening of the Kavango Basin,a previously unrecognized, deep sedimentarybasin in northwestern Botswana and northeasternNamibia. Botswana is considered a stable, industryfriendly jurisdiction which offers some of themost attractive fiscal terms worldwide. “Thislow-cost three-year option provides excellentvalue for Renaissance shareholders,” said IanTelfer, director of Renaissance.

The key terms of the license will give Recon a100% working interest in all petroleum rightsfrom surface to basement covering 2.45 millionacres in northwestern Botswana. The deepKavango Basin offers both large scaleconventional and non-conventional play types.It will also have an initial 4-year explorationperiod, with renewals up to an additional10 years, in accordance with the BotswanaPetroleum (Exploration and Production) Act.Upon declaration of commercial production, theLicense holder has the right to enter into a25-year production License with a 20-yearrenewal period.

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DOWNSTREAM NEWS

NLNG Train 7 EPC Contract AwardedSaipem, in joint venture with Daewoo E&C Co.and Chiyoda Corporation (SCD JV), has beenawarded by Nigeria LNG Ltd (NLNG) thecontracts for the Engineering, Procurement &Construction of the Nigeria LNG Train 7 Projectto be executed at Nigeria’s Bonny Island LNGcomplex.

The overall value of the contracts is more than$4 billion and Saipem’s share amounts to around$2.7 billion. Saipem holds a 60% share in theSCD JV. This award follows the signature of theLetter of Intent communicated via a press releaseon September 12, 2019

NLNG is a limited liability company whose mainshareholders are the Federal Government ofNigeria represented by the Nigerian NationalPetroleum Corporation (NNPC), Shell Gas B.V.,Total Gaz Electricité France and Eni International(N.A.) N.V.S.a.r.l.

The NLNG Train 7 Project consists of theconstruction of one complete LNG train and oneadditional liquefaction unit with a total capacityof approximately 8 Mtpa, plus other extensiveassociated utilities and infrastructures.

Stefano Cao, Saipem’s CEO, commented: “Thisnew project in Nigeria – where we have beenoperating for over 50 years – confirms our abilityto build solid relationships, qualifying Saipem asa global company. It also proves the validity ofthe management methods of Covid-19 emergencythanks to the flexibility of our organizationalmodel and the practice of our people to workremotely. The investment decision by NigeriaLNG Limited, which includes several importantenergy companies, demonstrates that natural gas,in whose value chain Saipem has a recognizedleadership, will be pivotal to the energy transition.The award of this contract contributes to increasethe portion of non-oil-related backlog andconfirms the overcoming of the link betweenSaipem’s share value and oil price.”

VFuels Wins Bid for a ModularRefinery Study in Equatorial GuineaEquatorial Guinea’s Ministry of Mines andHydrocarbons, supported by its strategic partner

Marathon Oil Corp., awarded North AmericanCompany VFuels Oil & Gas Engineering (VFuels)the feasibility study for the construction of amodular refinery in Punta Europa, Malabo.VFuels, which turned out to be the winner of thetender, will be in charge of the feasibility studythat will include the engineering and design of a5,000-bpd modular refinery to supply refinedproducts for domestic consumption. The study isexpected to be delivered within 12 weeks of thecontract’s signature.

This project is part of the initiative of the Yearof Investment 2020 promoted by the Ministry ofMines and Hydrocarbons, which is seekinginvestments for a modular refinery in thecontinental region, storage tanks and thepromotion of other projects derived frommethanol, among others.

“This is an important step when it comes toimplementing this project with an important goalto prevent stock outs, and provide refined productsof higher quality to economic operators and thegeneral public,” stated H.E. Gabriel MbagaObiang Lima, Minister of Mines andHydrocarbons.

Sonatrach IncreasesStake in Medgaz PipelineSonatrach announced the completion of atransaction to acquire 19.10% of the shares heldby the Spanish company CEPSA Holding in thecompany Medgaz SA. With this majorinternational operation, Sonatrach increases itsstake in Medgaz SA, and the Medgaz pipeline,by 8.04%.

Sonatrach’s stake thus goes from 42.96% to 51%in Medgaz SA, which manages and operates theoffshore gas pipeline directly connecting Algeria,departing from the Compression Station locatedin Beni-Saf, to Spain at the Arrival Terminallocated in Almeria.

With this acquisition, Sonatrach becomes a 51%shareholder in the new shareholding of MedgazSA with its historic partner Naturgy at 49% andthus strengthens its position as a major and reliablesupplier of Algerian gas to importing customersof Europe, in particular, the Iberian Peninsulathrough the Medgaz gas pipeline.

The offshore pipeline is 24• in diameter and 210kilometers long with an annual transport capacityof 8.2 billion cubic meters, which will be increasedduring the first quarter of 2021 to 10.2 billioncubic meters by adding a fourth Turbo-Compressor at the Beni-Saf Compression Stationin Algeria.

Egypt’s Urea Plant now OnlineRecently the performance test of the newly builtammonia-urea complex of Egyptian Chemical &Fertilizers Industry – KIMA – was successfullycompleted and the plants were handed over tothe customer.

The construction was a joint project betweenTecnimont and Stamicarbon – two sistercompanies within the Maire Tecnimont Group –as EPC contractor and urea technology licensorrespectively.

The fertilizer complex consists of a 1,200 tpdammonia plant, using KBR’s Purifier technology;a 1,575 tpd urea melt plant, using Stamicarbon’sPool Reactor Design; and a 1,575 tpd ureagranulation plant, using Stamicarbon’sGranulation Design. The plants are situated inthe Aswan Governorship in Upper Egypt.

While working in the difficult conditionscaused by Covid-19, Stamicarbon employeessupported KIMA in such a way that they wereable to run the plant properly and meet theguarantee figures, while Stamicarbon staffreturned home just before the lockdown andassisted them further via digital communicationtools. The Tecnimont team stayed onsite andhad to take special precautions and find newsolutions to secure the health and safetyof personnel.

With this project Stamicarbon now has 10 ureaplants licensed and in operation in Egypt, withthe next one already being designed.

Oil Tank Collapses, InfrastructureCompromised at Sharara FieldLibya’s National Oil Corporation (NOC)expressed its deep concern about thecontinued forced-closures of oil facilities,negatively impacting surface facilities,transport pipelines, and crude oil tanks, whichled to the collapse of one of the tanks atAl-Sharara field.

In addition to the almost daily leaks of transportpipes and their negative effects on the surroundingenvironment, NOC specialists predicteddangerous consequences for the millions of barrels

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stored as they are vulnerable to explosions andmass destruction in the event that the fields andports turn into military operation areas instead ofoil areas.

NOC expressed its frustration due to themilitarization of the oil facilities but confirms itcontinues to fulfill its responsibilities asspecialized teams conduct many technicalconsultations, public safety inspections, andimplement process safety and precautionarymeasures in anticipation of any emergency, incoordination with partners.

Experts from NOC and its partners concludedthe need to empty all crude oil stocks, and alsoto provide storage capacities to store condensateassociated with the produced gas so that the gasproduction does not stop after a few days. Thisgas is used to generate electricity to all regionsof the country.

The National Oil Corporation also implored allthose responsible for the closures of its facilitiesto neutralize the oil sector from any bargaining,and impressed the need to end the ongoing closureof oil facilities immediately to allow theresumption of oil exports. These measure are toensure the achievement of the minimum revenuesthat will guarantee Libyans the continuation ofsalaries and services and maintain the country’sforeign exchange reserves.

Clariant Introduces New Phthalate-FreePerformance Catalysts for PolypropyleneClariant is launching its next-generation phthalate-free olefin polymerization catalysts, expandingits portfolio to include a new offering to meet themost demanding customer toxicity requirements.Developed in partnership with McDermott’sLummus Novolen® Technology, the newPolyMax 600 Series catalysts answer themarket’s increasing need for safer polypropylenesolutions.

Stefan Heuser, Senior Vice President & GeneralManager at Clariant Catalysts, commented,“Performance is the key difference with our newPolyMax 600 Series catalysts. We havesuccessfully developed a phthalate-free solutionthat adds significant value to our customers’businesses. The innovative technology, whichallows customers to achieve higher productivity

rates and reduced process fluctuations, isdelivering excellent results – with one majorpolypropylene producer now estimating economicbenefits to exceed $8 million annually.”

The improved performance is due to a newproprietary technology that increases catalystactivity up to 25% compared to phthalate-basedcatalysts. This new technology results in not onlyhigher plant productivity, but also superiorpolymer properties, such as increased impactstrength for better durability.

PolyMax 600 Series catalysts are a drop-inreplacement for phthalate-based polyolefincatalysts and are designed to suit a broad rangeof process requirements, in applications rangingfrom food packaging to engineered automotiveparts. Considering the rapid growth of thepolypropylene market, the catalysts come at anopportune time to help producers meet bothincreasing demand and stricter regulations.

Sonatrach andTotal Renew LNG AgreementSonatrach, Algeria’s state oil and gas concern,and the French energy major Total have concludedan agreement to renew their partnership in thefield of liquefied natural gas (LNG) for anadditional three yeara, Sonatrach announced ina statement.

This agreement will supply the French marketwith 2 million tonnes per annum of AlgerianLNG, with deliveries to the LNG terminal at FosCavaou.

The two parties stressed the importance of thisagreement which “is part of the long history ofcooperation between Sonatrach and Total.”

Commenting on this agreement, SonatrachCEO Toufik Hakkar said that his firm “confirmsits status as a reliable partner, respecting itscontractual commitments and enjoying acertain credibility on the internationalenergy market.”

Oil Spill in NigeriaCaused by Equipment FailureThe National Oil Spills Detection and ResponseAgency (NOSDRA) of Nigeria reported that thetwo recent leaks from Nigerian Agip Oil Company

(NAOC) oil fields in Southern Ijaw and BrassLocal Government Areas of Bayelsa were causedby equipment failure.

The spill occurred on the 24-inch Ogoda-Brasscrude oil trunk line and left a devastating mess.Chairman of Okpoama Kingdom Oil and GasCommittee, Percy Wemi-Kwomain, said NAOCmade two attempts to fix the leaking pipelinewithout the usual Joint Investigation Visitconducted by the relevant authorities concerned,but were stopped by youths placed on surveillancein the area, according to a report by Nigeriannews outlet Punch.

Egypt’s DamiettaRestart Deal Falls ThroughA deal put together between Naturgy and Egyptianauthorities in February that would have allowedthe restart of Egypt’s 5 M/T Damietta LNG exportfacility has fallen through. The deal would haveseen Damietta, dormant since 2012, restart. Thefacility is operated and 80% owned by UnionFenosa Gas (UFG), a 50-50 joint venture betweenItaly’s Eni and Spain’s Naturgy.

Eni and Naturgy had reached an agreement inFebruary with the Egyptian government thatwould have seen Naturgy exit the UFG jointventure. Naturgy would have taken $600 millionfor most of UFG’s assets outside Egypt and itsequity in the Damietta LNG, with the equitypassing to the remaining stakeholders in the plant.Following Naturgy’s exit, the plant would havebeen 50% owned by Eni, 40% by EgyptianNatural Gas Holding Co. (EGAS) and 10% bythe Egyptian General Petroleum Company(EGPC).

However, the global Corona Virus pandemiccombined with a significant drop in oil and gasprices and market uncertainty, have resulted inthe plug being pulled on the deal with the assetnow losing significant value in the face of thesedevelopments.

Naturgy says it will resume its claim in a $2billion arbitration case against the Egyptiangovernment but has said it is still open to an“amicable” settlement. The World Bank’sInternational Center for Settlement of InvestmentDisputes had already ruled in Naturgy’s favor inthe case in 2018.


POWER & ALTERNATIVES

KenGen Shortlists 5Bidders for Okaria VIKenGen, or Kenya Electricity GeneratingCompany PLC, is in fast forward mode to set upthe first phase of its Olkaria VI 140-MWgeothermal power plant in Naivasha, havingrecently shortlisted five bidders for the project.

Ormat Technologies Inc, ITOCHU Corporation,Sumitomo Corporation, Enel Green Power anda consortium of Engie Energie Services, ToyotaTsusho Corporation, Kyuden InternationalCorporation and DL Koisagat Tea Estate wereshortlisted as qualified bidders on May 8.

The Olkaria VI geothermal project will fall underthe BOOT model (build, own, operate andtransfer). The winning party will enter into a jointventure with KenGen and will finance, construct,own and operate the power plant and theassociated facilities and transfer the Project backto KenGen at the end of the operational term.This will be the first Public-Private Partnership(PPP) Project to be developed by KenGen underthe PPP Act 2013 and the PPP Regulations 2014.

Eiffage Begins Construction onCôte d'Ivoire’s Singrobo HydroelectricFrench firm Eiffage Génie Civil and EiffageEnergie Systèmes was recently issued a FullNotice to Proceed (FNTP) by Denham Capitalplatform ‘Themis’ to begin construction of theSingrobo dam and hydroelectric power station inCôte d'Ivoire. Eiffage was awarded the contractto build the Singrobo hydroelectric dam inOctober 2018.

This project, which is being handled under adesign-build contract by Eiffage Génie Civil andEiffage Energie Systèmes, is located on theBandama River between Abidjan andYamoussoukro. It includes the construction of amixed rockfill and concrete dam, a spillway, aplant housing the turbines, a discharge channel,the switchyard, the line connecting thepower plant to the grid, temporary facilities andaccess roads.

The project is expected to be complete in 34months and the power plant will produce 44 MW.

Scatec Solar CommissionsHybrid Facility in South SudanScatec Solar has commissioned a combined solarand battery storage plant in Malakal, South Sudan.The plant will power the Humanitarian Hub inMalakal, which is managed by the InternationalOrganization for Migration (IOM). The projectwill reduce the diesel consumption at the Hub byat least 80%.

“We are thrilled to have completed this projectfor IOM and the Humanitarian Hub in Malakal.This is our second hybrid project for a UnitedNations (UN) organization in South Sudan, andwith a third project to be completed for UNMISSin the next few weeks, we are reinforcing oursupport of the United Nations in their quest toreduce their use of fossil fuels,” said CEO ofScatec Solar, Raymond Carlsen.

Scatec Solar has developed the project inpartnership with Kube Energy. The plant, with asolar PV capacity of 700 kWp, combined with a1,368 kWH battery energy storage system isconnected to IOM existing diesel generators. Thedelivery of solar power will represent 80% ofthe energy consumed at the hub, greatly reducingthe need for diesel, and providing significantreductions in both CO2 emissions and energycosts. This is a key step in meeting UN targetson abatement of greenhouse gas emissions.Another obvious benefit is the silence alreadynoticed by people at the Hub now that thegenerators are turned off most of the time.

The project is provided through a flexible energysupply agreement. Carlsen is convinced of thepotential of similar leasing arrangements tosupport the transition to clean energy inhumanitarian operations: “Through providingleasing of solar hybrid plants, we are reducingthe barriers for using renewables. The combinationof a movable, quickly installed equipment andflexible contract length increases our customer’sfinancial flexibility, allowing them to access clean

and reliable solar power through monthlyinvoices, rather than high upfront investments,”he said.

The Humanitarian Hub hosts around 300 workersand 34 organizations. As most remote operations,they rely heavily on diesel-run generators, whichare polluting, costly and quite often inefficient.IOM seeks to improve the Humanitarian Hub’senvironmental footprint, and the project is anideal step towards reducing IOM’s dependenceon non-renewable energy.

Tanzania’s FirstWind Farm Comes OnlineTanzania’s energy sector has broken new groundafter the country’s first ever wind farm startedgenerating electricity as part of its start-up testingprocedures. Construction of the 2.4-MW plantwas completed in May, made possible thanks toa $1.2 million loan from the Renewable EnergyPerformance Platform (REPP), which concludedthe financial structure for the project.

Following mandatory pre-commissioning testsat the project site in Mwenga, situated in theMufindi District of Tanzania’s Iringa region, thefirst of the wind farm’s three turbines spun intoaction on June 5. The turbine is expected toinitially operate at a pre-set low production rate,before being gradually increased to fullcapacity in line with the commissioningprocedures. The other two turbines wereexpected to come online in a similar mannershortly thereafter.

Once fully operational, the wind farm will providemuch-needed energy security to customers of arapidly expanding private rural grid networkdeveloped and operated by project developer RiftValley Energy Group.

Until now, the network – which is the first of itskind in Tanzania – has been powered by a 4-MWhydropower plant that has been operational since2012. The hydro plant provides clean, grid-qualityelectricity to more than 4,500 homes andbusinesses across 32 villages, with any surpluspower sold to TANESCO under a hydropowerpurchase agreement.

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The wind farm will now enable Rift Valley EnergyGroup to continue with its network expansionplans and connect an anticipated 1,500 morecustomers over the next two years. The farm willalso serve to ensure there is always sufficientgeneration capacity available to its growing ruralgrid, even during the dry season when thehydro plant’s generation capacity significantlyreduces as a result of the region’s seasonalityof rainfall.

Kenya’s Kipeto Wind FarmSees Last Turbine InstalledKipeto Energy report that on May 31 itsuccessfully installed the last of 60 WTG’swith no Incidents recorded. GE supplied 60 ofits 1.7-103 turbines for the construction of theplant. The new wind farm will provide theenergy needed to power 40,000 households inthe region.

The 100-MW Kipeto wind power project willprovide clean energy to the national grid as asignificant contribution to Kenya’s Vision 2030and Big Four Agenda.

“This is a great milestone and we are very proudof the entire Kipeto Energy PLC team, all ourshareholders and all stakeholders who haveworked tirelessly towards the achievement of thisgreat milestone despite the current Covid-19pandemic,” a statement on Kipeto’s website read.

Egypt’s NREA PlansAdditional 3,170 MW of REIn line with the Egyptian government’s aim toincrease the share of renewable energy in thecountry’s energy production mix by 20% by 2022,and doubling it by 2035, the New and RenewableEnergy Authority (NREA) said it plans to add3,170 MW of renewable energy comprised ofsolar and wind energy projects.

“The projects under consideration are wind farmswith a total capacity of 2,200 MW and solarpower plants with a combined capacity of 970MW,” said NREA Director Mohamed El-Khayyat.

The country already has a mega project underwaywith the BenBan solar complex in the south ofthe country. Benban Solar Park is a solar PVpower station with a total capacity of 1650 MWpwhich corresponds to an annual production ofapproximately 3.8 TWh.

Cameroon and Chad ElectricityProject Slated for $385 Million LoanWorld Bank Group subsidiary, the InternationalDevelopment Association (IDA), has approvedtwo loans, valued at $385 million dollars, forCameroon and Chad. The funds will be used tofinance an electricity interconnection project

between the two Central African countries.Cameroon will receive $295 million while$90 million is slated for Chad.

The Project development objectives are tointerconnect the southern and northern powersystems of Cameroon, enabling electricity tradebetween the two nations, and increasing accessto electricity in the Chad capital city ofN’Djamena.

Rwanda Gets Serious,Announces Multi-Billion Climate PlanRwanda submitted its new national climate plan,dubbed Nationally Determined Contributions(NDCs), to the United Nations FrameworkConvention on Climate Change (UNFCCC) inearly June. The plan aims to create essential toolsto implement the Paris Agreement to cope withclimate change. The 10 major projects under theplan will amount to $2.4 billion over the next 10years. The government of Rwanda will be a majorfinancial contributor as well as NGOs, theRwanda Green Fund and both domestic andinternational investors.

Some of the projects will focus on solar-poweredsolutions such as solar mini-grids, solar poweredcook stoves, and solar irrigation solutions. Around$900 million is slated for the integration of electricvehicles under an e-mobility program that plansfor the phased adoption of electric buses, autosand motorcycles from 2020 onwards. The programalso includes an energy-from-waste componentto reduce methane gas emissions as well as variousagriculture projects to reduce gas emissions fromfarming and livestock.

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ver the years, Mozambique has been an importer of oil, gasand petroleum products in general. The situation has somewhatchanged over the last 15 years or so with the start of natural

gas and gas condensate production in the Pande and Temane fields.Still, most of the natural gas production is exported to South Africa bypipeline and only a fraction is used in Mozambique in industrial, gas-to-power and limited local distribution projects.

The country’s importer status has been not only the result of its owndomestic supply needs, but also a consequence of its strategic geographiclocation. Several neighboring interland countries – such as Zimbabwe,Zambia and Malawi – are also dependent on oil and gas imports tosatisfy their needs and Mozambique is a natural gateway for suchimports. Therefore, the Mozambican downstream business, besides thedomestic supply, has always comprised a significant component ofpetroleum products in transit to neighboring countries.

The prospects of change are however very significant. On the one hand,there are plans for some light oil production to be used in the localproduction of petroleum products. And on the other hand, there isconsiderable hope that part of the very large natural gas reservesdiscovered in the Rovuma Basin will not be exported as LNG and willbe used domestically in different projects, such as power generation,production of fertilizers and gas-to-liquids (GTL).

The regulation of downstream activities in Mozambique has thereforehistorically significantly focused on import activities and pricing-relatedissues. Notwithstanding, activities such as production, reception, storage,handling, transportation, distribution, trading, exportation andre-exportation of petroleum products have also been regulated andliberalized. Duly licensed private entities have been able to carry onthese activities for many years nowand this was the case under theformer Petroleum OperationsRegulations, which had beenapproved by way of Decree No.45/2012, of 28 December 2012. Itwas therefore with some expectationthat existing and prospectives t a k e h o l d e r s v i e w e d t h eGovernment’s initiative of revisionof such statute. Eventually suchrevision was enacted in the form of

Decree No. 89/2019, of 18 November 2019, which approved the newPetroleum Products’ Regulations and revoked the former 2012 PetroleumDownstream Regulations.

The expectation among industry players was not however the sameacross the entire value chain. While the majority of existing stakeholderswere mainly concerned with the impact of changes on ongoing activitiesand these essentially related to import and pricing, prospective investorslooking at future production activities were hoping to see some evolutionon how the use of oil and gas of Mozambican origin would betreated by the lawmaker. It is fair to conclude that not all expectationswere adequately addressed by the Government, as we will furtherdiscuss below.

By way of initial observation, we would say that the 2019 PetroleumProducts’ Regulations represent a relatively light evolution of the legalframework set forth in the 2012 Petroleum Downstream Regulations.The focus appears to have been to clarify certain matters that were notpreviously fully addressed, while preserving a similar structure to theregime now repealed. A number of changes were introduced, mostimportantly in connection with the licensing procedure: while productionand distribution licenses remain standardized, specific subtypes forretail and storage are now available for downstream players, as wellas a new license for exportation. A new register for petroleumdownstream facilities is created and the registration and inspectionrequirements and procedures are detailed. Comprehensive provisionson the transfer of petroleum facilities are also included.

Bunkering activities are again regulated, as is also the case of the supplyof petroleum products to platforms, support vessels and other facilitiesused in petroleum upstream activities. Such supply continues to be

exclusively reserved for distributorslicensed in Mozambique.

IMOPETRO is once more entrustedwith the role of Liquid FuelsProcurement Operator for LPG,gasoline, jet fuel and diesel.Although the importers of recordwill be distributors or other eligiblelicensed entities, IMOPETRO actsas their agent in purchasing thepetroleum products from abroad.

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MONTHLY FOCUS

…there is considerable hope that part ofthe very large natural gas reserves

discovered in the Rovuma Basin will not beexported as LNG but will be used

domestically in different projects, such aspower generation, production of fertilizers

and gas-to-liquids (GTL).

M O Z A M B I Q U ER E G U L A T O R Y U P D A T E

New downstream regulations in Mozambique have been set but will theyencourage the production of petroleum products for domestic use?

By Diogo Xavier da Cunha / Joana GonçalvesMiranda & Associados


An important variation is that the share capital of IMOPETRO will nolonger have to be held in at least 51% by the State-owned fuels company,PETROMOC – Petróleos de Moçambique, and that such capital shallbe held by the licensed distributors prorata to their market share andtaking into account the geographic coverage of their business. Amongthe detailed provisions on the conduct of IMOPETRO’s businessactivities, it is worth highlighting that its management shall beentrusted to a General Manager hired pursuant to a public tender,although subject to homologation of the Minister of Mineral Resourcesand Energy.

To ensure the transparency andcompetitiveness in procurementprocedures, a Liquid FuelsProcurement Committee (CACL)is also foreseen and its compositionand powers are thoroughlyaddressed. This evidences aparticular concern in monitoringthe cost of imports in view of theirimpact on the price structure.This is further evidenced by theprovisions on international public tender requirements andprocedures relating to supply contracts to be entered intoby IMOPETRO.

Price regulation is also once more one of the key matters detailed inthe 2019 Regulations, including in terms of the margins of distributors,storage retailers and general retailers selling products to end consumers.ARENE (Mozambique’s Energy Regulatory Authority) is responsiblefor determining the sales prices for end consumers to be practicedthroughout the Mozambican territory.

Another matter that carries on being thoroughly dealt with pertains tothe security of supply and the creation of strategic reserves. Safetystandards for petroleum facilities and technicians are also provided for,

as well as the specifications for petroleumproducts and associated inspection mechanisms.

Lastly, one must also stress the concernevidenced in multiple provisions of theRegulations in connection with anti-competitivepractices. In most cases, these provisions standon their own, but it will always be necessaryto take into account the general legal frameworkapplicable to competition matters.

Overall, one can say that the 2019 PetroleumProducts Regulations are a positive evolutionof the 2012 Downstream Regulations.Notwithstanding, the lawmaker has not beenparticularly concerned in creating a more robustregime for the local production of petroleumproducts, in particular on the basis of oil andgas originating from Mozambique. It is true

that the preference for the procurement of locally produced productsis expressly provided for, but there is no distinction between productsderiving from imported oil and gas and products originating from oiland gas extracted in Mozambique. This is also reflected in variouspricing-related provisions.

Still, the more relevant issues that prospective investors in sizeabledownstream activities face arise from other pieces of legislation. Thereis no specific tax regime for production activities, for instance. The

same applies to investment andforeign exchange matters, whichare typically delicate. Furthermore,certain larger projects, as would bethe case of a refinery, would haveto tackle the challenges presentedby the legislation on public-privatepartnerships, large scale projectsand business concessions, but it isunclear to which extent suchlegislation could also apply to otherentities involved in downstreamactivities. It is probably too harsh

to state that the lawmaker has lost a good opportunity to fix all theseissues, but it is fair to acknowledge that with regard to the productionand use of petroleum products deriving from oil and gas extracted inMozambique, the new Regulations have not quite lived up to theindustry expectations.

About the Authors*Diogo Xavier da Cunha is the Managing Partner and Global Head of theEnergy and Natural Resources Practice at Miranda & Associados. Diogofrequently advises oil &gas companies in setting up and carrying out theiroperations in Africa. Joana Gonçalves is a member of the Energy andNatural Resources Practice at Miranda & Associados. Diogo andJoana may be contacted at [email protected] [email protected].


Overall, one can say that the 2019 PetroleumProducts Regulations are a positive evolution

of the 2012 Downstream Regulations.Notwithstanding, the lawmaker has not beenparticularly concerned in creating a morerobust regime for the local production of

petroleum products…

Currently, Sasol’s operations in the Pande and Temane fields feedthe country’s downstream exports via pipeline

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NEW PRODUCTS & SERVICES

T.D. Williamson (TDW) has introduced itslatest isolation innovation for the gasdistribution market, the POLYSTOPP® QuickConnect system. Lightweight and easy touse, it allows operators to isolate apolyethylene (PE) line twice as fast as othermethods while preventing the damageassociated with squeezing.

According to HT&P senior product managerRyan Ragsdale, it takes less than 10 minutesto tap and isolate a pipeline with thePOLYSTOPP Quick Connect system. Thetechnician can install the tapping, pluggingand completion machines onto the valve inabout 20 seconds each, and removal is justas fast.

“Faster isolation dramatically decreases jobtime and increases efficiency while preservingpipeline integrity, which maximizes value tothe operator,” Ragsdale said.

The POLYSTOPP® Quick Connect systemis extremely lightweight compared toprevious solutions. All components are madeof aluminum, including the valve andtapping, plugging and completion machines.That makes it light enough for a one-personlift operation.

POLYSTOPP Quick Connect technologyallows TDW to meet the needs of the PEmarket with something the industry has neverseen before.

“Because we understand that the gasdistribution industry is truly a lifeline foreveryday citizens, TDW is constantly lookingto develop technology that will enable operatorsto enhance pipeline integrity and do it faster,easier and more safely,” Ragsdale said.

This is the second cutting edge isolationproduct TDW has brought to gas distribution

operators in recent months. The ProStopp™DS isolation tool is the first and only low-pressure double block and bleed technologyspecifically designed for that market.

POLYSTOPP® Quick Connect System Increases Safetyand Speed of Gas Distribution Pipeline Isolations

Intertek, a Total Quality Assurance providerto industries worldwide is increasing theavailability of its innovative Remote VideoInspection (RVI) service, a technologicalsolution driven by its Total Quality Assuranceexperts, to ensure business continuity ofcritical vendor inspection services across theoil and gas supply chain during the currenthealth and safety site restrictions.

With the unprecedented global spread ofCovid-19, governments and businessesaround the world are taking steps to respondto the outbreak and to protect the health,wellbeing and safety of their people. Theseactions also impact International OilCompanies (IOCs) and National OilCompanies (NOCs) based in the Middle Eastand North Africa region and their regionaland international vendors that haveimplemented policies to restrict the accessof third parties to their sites to undertakecrucial audit and inspection services.

As a leading global provider of third-partyvendor inspection solutions, Intertek’sTechnical Inspection Services business iswell-prepared and has rapidly adapted to the

constantly evolving environment bydigitalizing some of its processes to becomecontactless, while continuing to help globalcustomers maintain critical businesscontinuity, supply chain requirements andmanufacturing schedules.

Through remote live video streaming andsmart phone technology, Intertek’s technicalspecialist inspectors can remain home-basedduring travel and access restrictions whilestill leading the inspection activities withinthe client premises. Customers in the UAE,Saudi Arabia, Bahrain, Iraq, Kuwait, Oman,Qatar and Egypt can interact with the Intertektechnical specialist to ask questions andvisualize the experience. As the inspectionsare undertaken in real-time, in the event thatpotential issues are identified during theinspection, follow-up actions can be discussedwithout delay, resulting in productivity gainsand faster issue resolution times.

Intertek’s RVI solution has been deployedto companies throughout the world, includingthe Middle East, so that the company’s vendorinspection activities can continue to deliverthe essential value that protects end-user

clients and their supply chains from exposureto quality defect risks. Driven by Intertek’sglobal network of expert and experiencedtechnical specialists, and supported bysecurity protocols and standard operatingprocedures, the RVI solution enables qualitycontrol, inspection, and quality assurancea c t i v i t i e s t o c o n t i n u e w i t h o u tcompromising safety and quality andirrespective of location.

Hussain Al Atrakchi, Vice President ofIntertek Industry Services for Middle East,North Africa, and West Asia, explained:“Health and safety restrictions are realchallenges for Intertek’s clients who wish tosafeguard business continuity wheneverauthorized access is limited. The remoteinspection team helps clients ensure theirequipment comply with the requiredspecifications and that their projects stay onschedule by minimizing disruptions to theirsupply chain. When measured in hours savedby technicians, the RVI solution can lead toup to 70% productivity gain. The issueresolution time also becomes 20% faster byusing the Intertek RVI App and smarttechnologies in real-time.”

Intertek Launches Remote Video Inspection

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Weatherford International plc has announcedits ForeSite® Production-OptimizationPlatform demonstrated $18 million in annualsavings for a Fortune 500 producer bydelivering measurable improvements inefficiency, uptime and production. Thecompelling combined results persuadedthe operator to order a global rollout ofWeatherford’s field-wide intelligenceplatform to maximize productionacross their U.S. and internationaloperations.

Weatherford, in tandem with the West Texasoperator, successfully implemented theForeSite production-optimization platformenterprise-wide, leveraging existing field-data streams as a path to improvingefficiencies for multiple forms of artificiallift. Demonstrated improvements includedsavings in equipment life and personnel gainthrough management-by-exceptiontechniques.

“The customer’s objectives were clear,” saidManoj Nimbalkar, Global Vice President,Production Automation and Software,Weatherford. “One, the solution mustaccommodate multiple forms of production,

including natural flow, rod lift, gas lift, andelectrical-submersible pumps (ESPs). Two,Weatherford must create an enterprise-wide,data-agnostic optimization system to reachacross multiple software systems andcompanies. Three, the solution must leveragehistorical data from the outgoing softwareand integrate real-time feeds from the existingWeatherford CygNet® SCADA platform, aswell as a competitor’s field-allocation andwell configurator.”

The Weatherford production-optimizationteam collaborated with the operator to assessthe production strategy and data needs acrossthousands of wells. Together, Weatherfordand the operator agreed to a phased rolloutof the ForeSite production-optimizationplatform, starting with an initial pilot thatwas governed by KPIs that would lead tofurther, enterprise-wide adoption.

Following the complete rollout, the operatorexpects an annualized savings of $18 millionper year. These projections include asavings of $6 million in personnel efficiency,$7 million in increased equipment run-life,and an additional $5 million in revenuegarnered from wells t ransi t ionedmore quickly from natural-flow lift toartificial lift.

ForeSite was installed on a subset of wells– including natural flow, reciprocating rodlift, gas lift, and ESPs – and the platformseamlessly integrated all existing andhistoric data-management and planningsystems into a single production-optimizationplatform. The resulting real-time efficienciesempowered the operator to manage allpi lot wel ls , both product ive andunderperforming, by exception, leading tothe multimillion dollar savings in bothproduction and uptime.

“The ForeSite pilot exceeded all KPIs andas a real result, the program was expandedto include nearly 1,000 wells in a Phase 1rollout, which will be adopted enterprise-wide over the next two years,” saidNimbalkar

Weatherford Production Optimization PlatformDelivers Multimillion-Dollar Savings

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Halliburton introduced the DynaTrac Real-Time Wireless Depth Correlation System, anew technology that reduces uncertainty andsaves rig-time by enabling operators toaccurately position packers, perforating gunsand the bottom-hole assembly withoutrunning wireline or moving the work string.

The DynaTrac system takes staticmeasurements to determine the position ofthe BHA before and after setting theretrievable packer. Operators can measuredepth at any time while tracking changes inposition to improve operational efficiency.

“We developed DynaTrac to provideoperators with a safer and more accurate

position of their BHAdepth in real-time,” saidDaniel Casale, vicepresident of Testingand Subsea. “Thetechnology reducesdownhole uncertaintyand improves reservoirinsight while savingvaluable rig-time.”

Through on-demandmeasurement of toolposition, the technology reduces health, safetyand environmental risks associated withperforming wireline operations. Additionally,operators can configure the system to perform

automatic position measurements to trackBHA movement over time, whichincreases the accuracy and reliability ofreservoir analysis.

Halliburton Launches Real-Time WirelessDepth Correlation System

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TECHNOLOGY AND SOLUTIONS

Addressing the Challenge of Corrosion inDownhole Tubing and Casing Applications

eading players in the oil and gas industry, TWI and DNV GL,have come together under the auspices of the Non-metallicInnovation Centre (NIC) to address the significant challenge

of corrosion in downhole tubing and casing applications in the oil andgas industry. For example, the annual cost of this in relation to tubingwas estimated by NACE at $463 million in 2018, representing over33% of the total cost of corrosion in the oil and gas industry.

Fiber reinforced polymer pipes, however, offer an alternative solutionbecause they are corrosion free and provide a number of benefits, suchas higher strength to weight ratio when compared to metallic pipes;smoother bore that reduces rig capacity requirements; and the potentialto be spoolable making them easier to transport and install than metallicpipes. In addition, the application of non-metallics can lead to costsavings due to reduced workflow and interventions, greater wellintegrity, improved safety levels and lower environmental risk.

Despite the tangible benefits of using composite materials, there is stilla reluctance to use non-metallic tubing in casing in the oil and gasindustry but, working together, TWI and DNV GL have identified thatthe main barrier to their application is the lack of rigorous design andqualification practices, which would serve to minimize the risk ofpremature failure and provide operators with confidence intechnology adoption.

Furthermore, adaptation of the failure envelope approach for steelpipes, as in standard API 5C2/C3 for non-metallic pipes, requiressubstantial effort and resource as it necessitates a large amount of full-scale testing. This makes qualification of such products impractical,costly and time-consuming.

To address these challenges, the NIC has invested in a TWI – DNVGL collaboration that will see them jointly develop the first industryguidelines for the design and qualification of composite tubing andcasing for downhole oil and gas applications. These will lead to areduction in the amount of full-scale testing required, providing atoolkit with which to optimize associated costs and engender a higherlevel of confidence in overall product performance.

The guidelines will utilize experience from across the value chain ofcomposite pipes, and state-of-the-art design pyramid practices developed

in DNV GL composite standards such as DNV GL-ST-C501 andDNVGL-ST-F119. The design pyramid approach is a multi-scalemodeling and testing scheme which includes testing at different scalesand connecting them by models. It has been successfully developedand tried in DNV GL-ST-F119 for Thermoplastic Composite Pipes(TCP) in past years with multiple TCP products already fully qualifiedand in service.

The first phase of this Joint Industry Project (JIP) is due to commencein summer 2020 and will include around 10 participants from the oiland value chain.

Mihalis Kazilas, NIC Program Director said: “TWI is delighted tocome together with DNV GL for this project on which we can poolour many years’ expertise and experience in the oil and gas industry.” “We believe that the guidelines we plan to develop are essential inenabling the deployment and adoption of non-metallic tubing andcasing, and will also serve to accelerate and support the developmentof new products.” he added.

Principal Specialist, Fracture Mechanics and Non-metallics, DNV GLRamin Moslemian said, “DNV GL is happy to work with TWI andother partners in this JIP to expand the use of composite tubulars todownhole applications, using the multi-scale methodology of ourstandards for composite components.”

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Non-metallic Innovation Centre brings together TWI and DNV GL to develop first industryguidelines for composite tubing and casing in downhole oil and gas

Addressing the Challenge of Corrosion inDownhole Tubing and Casing Applications

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An example of plastic pipes



TECHNOLOGY AND SOLUTIONS

Augmented Reality in Plantweb Optics

merson has recently introducedaugmented reality (AR) technologyto its Plantweb™ Optics asset

performance platform, delivering enhancedaccess to real-time diagnostics and analytics,as well as live remote assistance, toindustrial plant workers responsible formaintaining and optimizing plantequipment. With AR technology integratedinto Plantweb Optics, companies canimprove productivity, collaboration andoperational performance, without beinglimited by shortages of skilled workers ortravel restrictions.

“Successful digital transformation programsthat lead to Top Quartile performance havepeople and work practices as a key focus.Adopting innovative technology likeaugmented reality and institutionalizingbest practices enable workers to add morevalue than ever to operational and business performance,” said StuartHarris, group president for Emerson’s digital transformation business.“With these new Plantweb Optics technologies, customers can experiencesignificant improvements in equipment reliability and the safety oftheir facilities.”

Plantweb Optics leverages artificial intelligence, machine learninganalytics and data contextualization to provide real-time visibility intoplant reliability and operational performance. Unlike standalone ARsolutions that require custom engineering, AR is integrated into PlantwebOptics, providing immediate access to a wealth of data and translatinginto easier, less costly implementation and a faster return on investment.For use by manufacturers in the life sciences, food and beverage,chemical, metals and mining, power and water, pulp and paper andenergy industries, Plantweb Optics is part of Emerson’s Plantweb™digital ecosystem of technologies, software and services.

Augmented reality for Plantweb Optics transforms the way fieldtechnicians accomplish complex tasks through enhanced situationalawareness, live remote assistance and analytics delivered in contextof the plant. As a field technician walks an industrial plant with amobile device, Plantweb Optics uses spatial computing technology tomap assets and provide technicians with critical maintenance information

relevant to their location. Plantweb Optics overlays real-time analytics,equipment health status and technical support documentation on theirfield of view, so technicians can safely resolve issues sooner.

The augmented and virtual reality market is projected to grow annuallyat 40% from 2017 through 2025, according to multiple research reports.Much of this spending will come from manufacturers around the globeusing AR technology to help upskill their workforce for digitalizedoperations.

With live remote assistance, field technicians can be virtually shadowedby experts, either on-site or off-site, from Emerson, their own companyor another service provider. Experts can talk, type or augment thetechnician’s mobile display with graphics to guide the next action. Liveremote assistance enables technicians and experts to collaborate forsafe troubleshooting and repairs, regardless of location and withouttravel costs. Live remote assistance sessions, best practices and notesfrom experienced engineers and step-by-step troubleshootingprocedures can be logged into a knowledge library for use by allengineers at a site. The knowledge library is a resource for companiesto standardize procedures and ensure engineers of all experience levelsunderstand an asset’s history and are using best practices for safe,efficient operations.

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Emerson integrates augmented reality into Plantweb optics software,enhancing remote collaboration, workforce effectiveness

Augmented Reality in Plantweb Optics

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LOCAL IMPACTBy Akinwumi A. Adesina, President

African Development Bank GroupBy Toufik Khitous

Business Development Manager for North AfricaWärtsilä Energy Business

How Egypt Banks on Renewablesto Meet Expected Surge of Energy Demand

To meet its soaring demand for energy, Egypt is turning to renewable sources. Its targets, if accomplished,will see it become a pioneer in the African energy landscape. But are the plans realistic?

gypt’s population has now passed 100 million. As one of themost populous and fastest-growing nations on the Africancontinent, providing electricity to all its citizens is a matter

of priority for the Egyptian government.

To ensure continuous security and stability of energy supply, Egypthas launched an energy diversification strategy, known as the 2035Integrated Sustainable Energy Strategy (ISES), which aims to step upthe development of renewable energy and energy efficiency inthe country.

Egypt aims to produce 20% of its electricity using renewable sourcesby 2022 and 42% by 2035. For the second target, the goal is for windto provide 14%, hydropower 2%, and solar 25%.

Ambition driven by necessityThis is a hugely ambitious energy plan, but it is one that is necessaryfor Egypt to flourish. In particular, the country wants to diversify itsmix of power sources. Egypt has introduced nuclear power and it is

also developing a few megaprojects that will bring a massive amountof gas into its energy mix.

This is in stark contrast to 2014, when, due to electricity shortages,Egypt was forced to introduce more coal into its energy mix in orderto lower its dependence on imported gas. Rising demands, the fallingcosts of renewable energy, and the discovery of new natural gasresources have allowed Egypt to both diversify its energy mix andbecome an exporter of gas.

Furthermore, environmental concerns over the generation and use ofcoal have reinforced this ecological approach. Egypt has signed up tothe United Nations Framework Convention on Climate Change(UNFCCC), meaning that it has no option but to reduce its dependenceon fossil fuels.

The spill-over effectTapping into renewable energy will benefit Egypt in ways more thanone. It will enhance the country’s economic growth and bring revenues

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in foreign currency. The increased usage of renewable energy is expectedto lead to exporting fossil fuels or using them in other areas domestically,such as industrial production.

The transition to renewable energy sources is also expected to helplocal businesses in Egypt, since the cost of electricity is an essentialfactor for business owners. While solar power and sustainable electricityare not widely available in the country yet, there is merit in Egypt’splan to tap into renewable energy resources in the long run. Morefactories will lean towards sustainable renewable energy if it iseconomical, due to the cost of production and increasing price ofelectricity.

Need of the hourBut to leverage the benefits of the transition to renewable energy, Egyptneeds to overcome a few infrastructural and geographic hurdles.

A report by the International Renewable Energy Agency (IRENA)provides a comprehensive assessment and recommendations for primarymeasures that Egypt must consider to achieve the goals set out inISES. The report points out the need to update Egypt’s electric powersector strategies to reflect the growing cost advantages and otherbenefits of renewable energy. It also focuses on reforming theexisting market framework to improve the economic feasibilityof projects.

Additionally, the country is very much split in two by the fabled riverNile, with many regions in the south still not connected to the national

grid. Egypt is very keen to invest in the tourism sector along the RedSea, meaning there is a need for not only infrastructure but also thepower to supply to these regions.

Egypt’s situation has changed a lot since 2011. Nowadays, the issueis distribution rather than consumption. Egypt has a tradition of settingits energy distribution vertically. This has a rather negative impact onhow the energy is consumed, but this can change since we are startingto see more industries coming into the country as Egypt is encouragingprivate sector participation.

What lies ahead?Between 2022 and 2027, Egypt plans to install an additional thermalpower plant and two clean coal technology power plants. These initiativesare expected to exceed the nation’s peak power and electricity demands.Of the renewable energy targets for 2022, both solar and wind areconsidered achievable. In particular, the Benban Solar Complex project,which is considered one of the largest solar PV power plant projectsin the world, and has a total installed capacity of 1.8 GW, is foreseento come online alongside a number of utility-scale wind farm projectsin Gulf of Suez.

Egypt certainly has a lot of unanswered questions at present, but itdoes seem to be on the right track. Three big parts – gas, sea turbinesand renewables – need to play their part going forward. Egypt has nochoice; it must invest in renewables. The sector at the moment onlymakes up around 2% of the energy mix, but these announcements couldraise it to 20% – this is almost a revolution.


he country gained independence from Sudan in 2011, and aftera rocky start, it is finally on a path towards stability and growth.The much-awaited government of national unity, elected in

February 2020, is now in place and their focus is on growth andeconomic stability.

But just how stable isSouth Sudan and whatopportunities are there?

Shawn Robert Duthie,the Managing Directorof Inyani Intelligence,an Africa-focused riskfirm offering politicalrisk analysis and due

diligence investigations shared his insights into the Republic of SouthSudan and the potential for the bold investor.

Canadian born, Duthie is passionate about Africa and explains that oneof the main aspects he pushes in his risk consulting is that it’s not justabout risk but opportunity as well – and Africa abounds with potentialand opportunity.

Duthie, who’s previously worked in South Sudan, has a keen interestin the region. He says that having a focus on South Sudan is

interesting, as it’s an area that a lot of companies aren’t looking atgetting involved in.

He says, “A lot of Western companies are staying away from SouthSudan, which is unfortunate and should change. There’s a lot of negativeimagery around the country, because of the war, but the opportunitieshere are huge. This is a frontier country – oil and gas is the main thing– but everything needs to be built up, so there are plenty of opportunitiesfor infrastructure, development, retail and manufacturing. Everyonejust thinks oil and gas, but it’s a blank slate and if you have a serviceto offer, it could do very well in South Sudan.”

Given that the country has come out of a civil war, it’s not surprisingthat political instability is a major risk. The biggest fear for would-beinvestors is whether the new government of national unity can hold onto the peace and prevent any return to conflict.

South Sudanese Undersecretary in the Ministry of Petroleum, Hon.Engineer Awow Daniel Chuang reassured would-be investors saying,“We think right now the political situation has improved, followingthe signing of the peace agreement and formation of the new government.We believe the situation for both South Sudan and the hydrocarbonssector will improve in the future. Over the years we have sufferedbecause of political instability, but now the time is right because thepolitical process is going very well. This will help attract more investorsto South Sudan.”

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OPPORTUNITIES ABOUND

IN SOUTH SUDANThe Republic of South Sudan offers opportunity and potential for those willing

to take a chance on this growing nation.

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Shawn Robert Duthi

South Sudan’s Toors Oil Field

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Duthie says, “If the new government can govern properly, hold ontothe peace, the balance between the different factions, and put forthpolicies that are good for investors and positive for the country, thenit’s on the right track. Investors want to see that oil revenue won’t bewasted on corruption and white elephant buildings but rather it’s putinto infrastructure, education and invested into the country – and thenthe risk profile lowers quite a bit.”

Investors can take heart that there are signs of positive growth in SouthSudan. Before the outbreak of Covid-19, the IMF and World Bankexpected South Sudan to be the fastest-growing country in the worldin 2020, growing by 8.2%, but because of the pandemic, this figure isnow reduced. According to the IMF’s Regional Economic OutlookReport on Sub-Saharan Africa (April 2020), the real GDP growth forSouth Sudan is now 4.9% for the year. This figure is considerably moreimpressive when one considers that between 2010-2016 the GDP was-7.4. However, the GDP has grown considerably over the years, in2017 it was -5.5%, 2018 was -1.1% and there was massive growth in2019 when it hit 11.3%.

Duthie isn’t surprised by this growth, saying, “Part of the economy’srecovery is rebalancing from the war, as the GDP dropped quite a bitduring the war, so it’s this rebalancing and the opening up the oil sectorwhich further pushes up the growth. If the government can get thepolicies correct, there’s no reason why they can’t sustain 5% + growthfor the next five to 10 years. There’s lots of potential and opportunitiesin South Sudan, especially for smaller companies that have a biggerrisk appetite. If a company goes in, makes a long term investment andis willing to work hard it will pay off. If a smaller company, that isn’tso risk-averse goes in with a strong social development stance and iswilling to invest long term in the country, then this type of companywill see a higher reward.”

Opportunities abound for those willing to invest in the country asUndersecretary Chuang explains that while major oil discoveries havebeen made in the past, there is now an opportunity for more expansionin the oil sector saying, “The geology for South Sudan’s unexploredreserves is very promising, we believe it’s an even bigger opportunity.This is why we are launching new licensing rounds. We know newcompanies will make more discoveries in South Sudan once they startto explore.”

The country hopes to launch new licensing rounds early next year.

Infrastructure from the Paloch Oil Field

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South Sudan to LaunchLicensing Round in 2021

The Republic of South Sudan is moving forward with the launchof a new licensing round early next year. Plans to hold its firstlicensing round in the first quarter of 2020 were derailed due tothe Coronavirus pandemic.

Undersecretary for theMinistry of PetroleumHon. Eng. AwowDaniel Chuang, says,“ U n f o r t u n a t e l y ,the Coronav i ruspandemic has forcedus to postpone thelaunch. Hopefully, wecan possibly launchthe licensing round

early next year. The pandemic has caused the delay as no-onewould have been interested in the launch if we had continuedwith it.”

Currently, South Sudan can produce oil in three areas but areonly producing in two of them. According to the Undersecretary,the country’s total current production is between 170,000 and172,000 barrels per day (bpd) which is not too far off from theprojected target of 190,000 bpd.

According to reports last year, the country had planned to offer14 northern blocks in the licensing round. The new explorationactivities will provide a boost to the country, helping accelerateeconomic recovery and spur the appetite of international oilinvestors and services companies. South Sudan is also lookingto attract diverse foreign investors to the oil sector.

Currently, there are investors from China and Malaysia, and thecountry is hoping to encourage more investment from the West.It hopes multinational companies will return, as many left thecountry when the conflict broke out.

The Undersecretary adds, “We have ambitious plans. We wereaiming to achieve our target of around 250,000 bpd by the endof next year, but current circumstances have made it difficult.Within a very short period, we should be able to achieve220,000 bpd and then 250,000 bpd. But this will not beachieved this year. We have the potential to reach 300,000 bpdby around 2022.”

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he pandemic, the oil glut and resultant barrel price crash inglobal markets has been a disaster to producing nations inAfrica, and Angola has not been spared. Projects are stalled,

or progressing more slowly, and there is little investment appetite foroil or service companies to take on new projects.

Before the dual crises for the petroleum industry hit, Angola had anupbeat outlook, with a new bid round scheduled, drilling campaignsscheduled, seismic shoots planned or underway and operators hadstrategies to ramp up production. Then came the announcement fromAngola’s National Agency of Petroleum, Gas and Biofuels (ANPG),the country’s national concessionaire.

On June 1, ANPG announced that the schedule of the planned bidround would see a delay due to the effects of the COVID-19 pandemic.It did not point to the low oil prices and oil companies rationalizingbudgets, but surely it was a factor.

“According to the Schedule of Activities of the Bidding Process 2020,all conditions were created so that by the end of May, the announcementof the intention to launch the public tender was made, pursuant toPresidential Decree No. 86/18, of April 2. However, due to the currenteconomic constraints caused by the COVID-19 pandemic, this datemay undergo minor adjustments,” a statement on the state entity’swebsite read.

ANPG went on to stress that despite the adverse situation, “the objectivesof previously scheduled bids have not changed. The need to streamlineand continue petroleum operations in the country remains valid, withemphasis on exploration activities.”

The state firm is still interested in hearing from prospective investorsand has advised that the Data Package for blocks for oil explorationin the Terrestrial Basins of the Lower Congo (CON1, CON5 and CON6)and the Kwanza (KON5, KON6, KON8, KON9, KON17 and KON20)is available.

UpstreamPrior to the downturn, Angola’s E&P sector had a good deal of activity.In January, Eni announced the start-up of its offshore Agogo oilfield,situated in the 15/06 Block in Angolan waters. The start-up took place

in record time, just nine months after its discovery thanks to theoperational synergies facilitated by the Floating Production StorageOffloading (FPSO) vessel Ngoma, West Hub production center, situated15 km from the oilfield.

The start-up was carried out with the drilling of the Agogo-1 well ata water depth of around 1,700 meters. Production at that time wasaround 10,000 barrels of oil per day (bpd) and was projected to reach20,000 bpd. According to preliminary estimates, the field holds over650 million barrels of oil in place, with a further potential that will beverified after the drilling of new delineation wells.

The following month, Eni had more good news with the Agogo-3appraisal well. This appraisal well, located in a water depth of 1,700meters, reached a total measured depth of 4,321 meters. Agogo-3encountered up to 120 meters of net pay of light oil (31°API) insandstones of Miocene and Oligocene age with excellent petrophysicalproperties. An intense data acquisition was carried out in the well andthe data confirmed the communication with Agogo-2 reservoirs andthe further extension of the Agogo discovery to the North. The dataacquired indicated a production capacity in excess of 15,000 bopd.

BP took steps to forward its Platina field development, awardingTechnipFMC a significant integrated Engineering, Procurement,

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Construction and Installation (iEPCI) contract for thePlatina field development, located in Block 18 at waterdepths ranging from 1,200 to 1,500 meters.

The contract covers the manufacture, delivery andinstallation of the subsea equipment including subseatrees, a production manifold with associated subseacontrol and connection systems, as well as rigid pipelines,umbilicals and flexible jumpers.

Other major IOCs had activities scheduled for 2020 priorto the downturnbut subsequently slashed their budgets.Fortunately, they received extensions from ANPG whichcould ease pressure on both the financial and time fronts.In Block 14, a Chevron, Galp and Sonangol consortiumsaw its exploration period extended until 2028. Overon Block 17, a Total, Equinor, ExxonMobil and BPpartnership signed an agreement with ANPG to extendtheir license until 2045, while an ExxonMobil-ledconsortium with BP and Equinor inked a PSA givingit until 2032 to undertake the work commitment activities.

Meanwhile, a couple of recent seismic programs of note were carriedout. PGS announced the completion of acquisition on its MC3D KwanzaShelf offshore survey in April. Total GeoStreamer coverage in Blocks6, 7 and 8 and the surrounding areas of the Kwanza Shelf is now 8,300sq kms. This MC3D Kwanza Shelf survey complements an earlier PGSacquisition, carried out in 2019.The latest Kwanza Shelf survey willprovide key data for the Angolan 2021 License Round. A fast-trackdataset is now available for viewing. The present-day shelf of theKwanza Basin has been overlooked in previous exploration cycles.The combination of 3D GeoStreamer technology with modernimaging techniques is expected to unlock plays in shallow KwanzaShelf open blocks.

Last December, Ocean Infinity announced it had been awarded acontract by Total E&P Angola, to conduct a seismic survey offshorethe south-western African country deploying their state-of-the-arttechnology to conduct 2D Ultra High-Resolution Seismic surveys andSeabed Soil Sampling. The 28-day project, completed in March, wascarried out from the host vessel Normand Frontier using Ocean Infinity’sinnovative technology, conducted 2D Ultra High-Resolution Seismicsurveys and Seabed Soil Sampling in Block 32 and Block 17.

The project was the first time that geophysical, geotechnical, andseismic data had been gathered at the same time. This was achievedthrough simultaneous operations of Ocean Infinity’s state of the artAutonomous Underwater Vehicles (AUVs) with geotechnical andseismic equipment based from one surface vessel. The successfulcompletion of this project, which was all done from one vessel and ona single cruise out to the project site, is a major breakthrough inmaximizing efficiency on sub-sea survey operations.

A New FrontierWhile behind the majority of its African counterparts in the renewableenergy sector, the Angolan government recently confirmed it is ready

to invest nearly a billion dollars in clean and renewable energy in aneffort to diversify the economy away from oil revenue dependence.

According to H.E Joao Baptista Borges, Angola’s Minister of Energyand Water, the government is prepared to invest around $500 millionover the next two years in solar energy projects in the country as partof a strategy to increase clean energy generation, and bring electricityto the entire country.

Additionally, Angola expects to implement a $400 million two-phaseproject in the clean energy segment, funded by the World Bank andthe French Development Agency (AFD). The focus of the project isto improve the distribution of electricity in four Angolan provinces aswell as reform the structure of public companies in the sector to increaseaccess to affordable energy for under-electrified communities.

DownstreamAngola currently only has one operating refinery in Luanda, but hasplans for more. These plans were put on the back burner when theAngolan government postponed the announcement of the winner ofthe public tender to construct an oil refinery in Soyo, due to theCOVID-19 pandemic. According to the Ministry of Mineral Resourcesand Oil, the announcement will be made as soon as the Coronavirusoutbreak is under control.

Companies and consortia selected and under consideration fromthe tender include SDRC, Jiangsu Sinochem Construction,Quantem Consortium, CMEC, AIDA and VSF, TobakaInvestment Group, AtisNebest – Angola, Satarem, Gemcorp Capitaland CPP.

Construction of the Soyo refinery is part a three-pronged program toexpand refining capacity in Angola. There are also plans for therestoration and modernization of the Luanda refinery, to quadrupleits capacity.

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ome years after the discovery of significant oil reserves offshoreBioko Island during the nineties, Equatorial Guinea becamethe third largest crude oil producer in sub-Saharan Africa, after

Nigeria and Angola. However, replicating a story that is seen in manyAfrican oil producers, it does not refine its own crude production. Fuelsconsumed in the country are all imported and, since the eighties, thedistribution of refined petroleum products is mainly secured by Total,which began its operations in 1984, enjoying a long-lasting monopolycurrently shared with the National Oil Company GEPetrol, and operatingalmost all fuel filling stations in the country (approximately 30).

Refining AmbitionsFor the past 10 years, the government haswavered as to whether or not to embark ondiversifying into refining. In 2010, GabrielObiang Lima, then Minister of Mines,Industry and Energy, announced plans toconstruct a refinery with a capacity of 20,000barrels per day (bpd) at Mbini on themainland of Equatorial Guinea, to producegasoline, diesel, jet A-1 and fuel oil, withthe primary purpose to supply the domesticmarket. KBR was awarded a contract for the design and future operationof the refinery, but the project did not advance and, in 2015, the ideaof a refinery had been abandoned. On the one hand, there was the fearthat the quantities and qualities of crude feedstock available for in-country refining would not be sufficient to meet the domestic marketdemand for the various petroleum products. On the other hand, therewas a concern with the high operating and maintenance costs of arefinery and a risk of excess production which could be difficult tomarket due to regional logistics challenges.

However, Equatorial Guinea has been among the countries worst hitby the crisis that affected all members of the Central African Economicand Monetary Community (CEMAC), which started in 2014 and keptdeteriorating with the oil price drop. To restore its external and fiscal

imbalances, Equatorial Guinea has been forced to undertake reformsand enter into an International Monetary Fund Staff MonitoredProgram in 2018, having as one of its goals the reduction of thecountry’s dependence on oil and gas exports, which generate almost90% of the country’s revenues. Minister Gabriel Obiang, who in 2016became Minister of Mines and Hydrocarbons, losing authority overother energy sources and industry, joined the effort by seeking todiversify Equatorial Guinea’s petroleum sector through the launchearlier this year of a campaign to attract foreign investors todownstream projects.

The “2020 Year of Investment” campaign was not abandoned due tothe COVID-19 outbreak. On the contrary, the pandemic, coupled withthe recent plunge in oil prices, led the Minister to allow the postponementof different upstream projects during March 2020, but also reinforcedhis belief that the priority of his Ministry for the hydrocarbon sectormust be to build a downstream industry in the country with a key focuson refining to stimulate local job growth.

According to the latest news, during the second half of the year, theMinistry expects to receive a feasibility study which will include theengineering and design of a 5,000 bpd modular crude oil refinery inthe Punta Europa area, located in Malabo, the capital of EquatorialGuinea. At Kogo, located South of Bata, the main city on the mainland,the Ministry wants to build a second modular refinery, with a 10,000to 20,000 bpd capacity and, at the end of March, it shortlisted investorsfor this second project. Other planned projects include the constructionof state-owned and managed storage tanks for refined products, amethanol-to-gasoline unit to meet domestic consumption, with thepossibility of exporting to neighboring countries in the future, and anammonia plant, among others.

Regulatory FrameworkThe 1981 Hydrocarbons Law, which was amended in 2000, did notcover downstream activities, but the Hydrocarbons Law adopted in2006 dedicated a chapter to the refining, storage, marketing and

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EQUATORIAL GUINEA

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Turns its Focus to Refiningand Downstream Projects

transportation of hydrocarbons. Article 41 of the 2006 Law allowsactivities related to the distillation, purification and transformation ofhydrocarbons, performed for the purposes of adding value and thecommercialization of the products obtained, to be performed by theState or other entities either jointly or individually. However, projectsfor the installation and operation of refineries must be aligned with anational plan and linked with specific projects approved in advance bythe Ministry responsible for the petroleum sector, and any companieswishing to perform refining and marketing activities must obtain alicense from the Ministry. On the other hand, the right to store, transportand otherwise distribute refined products in the country is reserved forthe State and any activities related to the storage, transportation andother distribution of hydrocarbons are also subject to licensing. Theprice of products for sale in the domestic market is established by thegovernment, considering the price of the crude oil from which theproducts originate, their refining, storage and transportation costs,the depreciation of investments as well as the profit margins in forcefor each activity.

The procedure and requirements for the award of licenses for theperformance of refining and related marketing activities that are notcovered by a production sharing contract or equivalent agreement forthe performance of hydrocarbons exploration and production wereregulated in 2013 with the enactment of the Petroleum Regulations.Licenses are requested in writing to the Ministry of Mines andHydrocarbons by applicants that must demonstrate having suitabletechnical and financial capability, as well as appropriate experiencein the petroleum industry to perform the relevant activities. Theinformation to be included in applications should cover thepremises and facilities, the applicable technology, the destination ofproducts, the economic resources to be used and, whereappropriate, any benefits for the country. Applications must alsoindicate how applicants plan to source feed stocks and other products,and the Ministry, either before or after the grant of the license, mayrequire that they are obtained from a specified source withinEquatorial Guinea.

Each license granted shall set forth its duration,which cannot exceed 25 years, a term thatcan be renewed one or more times up to amaximum period of 10 years. Assignmentsor transfers of any license, right or obligationsunder a license are subject to the priorwritten authorization of the Ministry ofHydrocarbons.

In addition to the license, anyone wishing tobuild or install a refinery will also have toseek the Ministry’s approval for its locationand design. The Ministry has not establishedtechnical standards applicable to the designof refineries, but the final detailed designmust be submitted for review and approvalby the Ministry, which may propose anyrequired amendments or modifications.

Licensees with the right to store refinedproducts can be required by the Ministry to maintain in storage aminimum level of a specific product, either in their license or throughthe service of a subsequent notice. Also, in the event of a nationalemergency, licensees may see all or part of their stored productsrequisitioned by means of a Presidential Decree, being paid for therequisitioned products in CFA Francs at the price prevailing in EquatorialGuinea at the date of the requisition.

The 2013 Petroleum Regulations expressly allow the Ministry to setforth and charge fees payable by licensees, with late payment or non-payment allowing the Ministry to withdraw the license, and to imposetariffs on any product manufactured in, imported into or exported fromEquatorial Guinea, even though the 2006 Hydrocarbons Law is silenton these matters. Unfortunately, the Regulations contain no guidelineson how these charges will be fixed or changed, leading to someuncertainty for potential operators.

What the Future HoldsRecently, the Minister of Hydrocarbons announced that his Ministryhas been working on the Petroleum Regulations to adapt them to thesechallenging times, which has led to the expectation that in the nearfuture some of the above rules may be clarified or complemented.However, there has been no mention to the modification or replacementof the Hydrocarbons Law, meaning that the principles and limitsimposed therein should not change. In any case, the Government’sambitions to diversify the hydrocarbon sector remain solid and, by theend of the year, it should be possible to know if Equatorial Guinea willfinally have domestic refined products.

About the AuthorCatarina Távora is a Partner and Co-Head of the Energy Group atMiranda & Associados, and coordinator of Miranda Alliance’sEquatorial Guinea Jurisdiction Group. She has more than 20 years ofexperience advising oil & gas companies in setting up and carryingout their operations in Africa, including in Equatorial Guinea. Catarinamay be contacted at [email protected].




MARKET MOVERS

South Africa to Create National PetroleumCompany, Merge Existing EntitiesSouth Africa held a virtual Cabinet Meeting wherePresident Cyril Ramaphosa’s plan to repurposeand rationalize a number of state-ownedenterprises to support growth and developmentwas discussed. Under this plan, the ongoing workto rationalize all petroleum (oil and gas)subsidiaries of the state-owned diversified energycompany, Central Energy Fund, will beimplemented.

The rationalization will result in three subsidiaries(PetroSA, Strategic Fuel Fund and iGas) mergedinto one single National Petroleum Company. Asa result, the Cabinet approved the proposedappointment of a professional restructuringcompany that specializes in mergers to investigatethe most viable model of this single NationalPetroleum Company.

Eni Launches New Business Structureto be a Leader in the Energy TransitionEni’s Board of Directors, chaired by LuciaCalvosa, has approved a new business structurefor the company which sets the evolution of thebusiness over the next 30 years. The key andunique element of this strategy is the combinationof growth objectives with financial value creationas well as environmental sustainability, whichwill lead to a significant reduction in full life-cycle carbon emissions.

The new Eni will have two business groups –Natural Resources and Energy Evolution.Alessandro Puliti will lead Natural Resourcesand Massimo Mondazzi will lead EnergyEvolution. Both were proposed to the Board bythe CEO, in agreement with the Chairwoman.

Natural Resources will continue to build up thevalue of Eni’s oil & gas upstream portfolio, withthe objective of reducing its carbon footprint byscaling up energy efficiency and expandingproduction in the natural gas business, and itsposition in the wholesale market. Furthermore,it will focus its actions on the development ofcarbon capture and compensation projects.

The business group will incorporate the company’soil & gas exploration, development andproduction activities, natural gas wholesale viapipeline and LNG. In addition, it will includeforestry conservation (REDD+) and carbonstorage projects, and sustainability which willcontinue to integrate across all Eni’s activities.The company Eni Rewind (environmentalactivities), will also be consolidated in thisbusiness Group.

Energy Evolution will focus on the evolution ofthe businesses of power generation, transformationand marketing of products from fossil to bio, blueand green. In particular, it will focus on growingpower generation from renewable energy andbiomethane, it will coordinate the bio and circularevolution of the company’s refining system andchemical business, and it will further developEni’s retail portfolio, providing increasingly moredecarbonized products for mobility, householdconsumption and small enterprises.

BP Agrees to Sell PetrochemicalsBusiness to INEOS for $5 BillionBP announced that it has agreed to sell its globalpetrochemicals business to INEOS for a totalconsideration of $5 billion, subject to customaryadjustments. The agreed sale, the next strategicstep in reinventing BP, will further strengthenBP’s balance sheet and delivers its target foragreed divestments a year earlier than originallyscheduled.

Under the terms of the agreement, INEOS willpay bp a deposit of $400 million and will pay afurther $3.6 billion on completion. An additional$1 billion will be deferred and paid in threeseparate instalments of $100 million in March,April and May 2021 with the remaining $700million payable by the end of June 2021. Subjectto regulatory and other approvals, the transactionis expected to complete by the end of 2020.

Nigeria’s DPR AdmonishesOil Companies on COVID-19 ConcernsNigeria’s Department of Petroleum Resources(DPR) has expressed concern over non-compliance to established protocols aimed atcontaining the COVID-19 pandemic by some oiland gas companies. DPR distributed its warningsvia a circular to oil and companies.

The circular commended efforts in implementingstringent measures to contain the spread ofCOVID-19, but said, “in spite of these efforts,the industry has sadly recorded COVID-19 casesin some offshore and remote locations, many ofwhich are linked to non-adherence toestablished protocols.”

DPR charged that some personnel of governmentauthorities did not subject themselves to thecontrolled isolation period which forms part ofthe protocol for the management of COVID-19by operators prior to embarking to these locations.“Consequently, and pursuant to Regulation 45 ofthe Petroleum (Drilling & Production)Regulations, 1969, no personnel (includinggovernment authorities) shall be permitted to

embark to offshore and remote locations in theoil and gas industry without being fully subjectedto established protocols. Furthermore, all operatorsare to ensure that evidence of compliance withthe protocols by personnel travelling to offshoreand remote locations are duly documented.”DPR’s statement went on to say that no personnelwould be granted a waiver of any sort.

Zenith Energy Delists from TSXZenith Energy announced that the TSX VentureExchange (TSX-V) confirmed that effective atthe close of business May 29, 2020, the commonshares of the company would be delisted fromthe TSX-V at Zenith’s request.

As announced on April 22 following thecompany’s dual listing on the Main Market forlisted securities of the London Stock Exchange(LSE) in January 2017 and the admission of itsentire share capital to the Merkur Market of theOslo Stock Exchange in November 2018, thecompany has seen its investor base moveincreasingly towards the UK and Norway, withlimited investor support from the Canadian market

Given the aforementioned, and in light of theimpact of the COVID-19 pandemic and low oilprice environment, the company has beenreviewing its corporate structure to maximizecost control and, following this review, has electedto delist from the TSX-V. The benefits of delistingare expected to result in materially loweradministrative costs, greater operational efficiencyand management time savings.

Earlier in May, Zenith closed a deal with AngloAfrican Oil & Gas plc (AAOG) to acquire a 100percent interest in Anglo’s fully owned subsidiaryin the Republic of the Congo, Anglo African Oil& Gas Congo S.A.U (AAOG Congo); the salegave the company the Tilapia asset. In April,Zenith acquired a working interest in, inter alia,the North Kairouan permit and the Sidi El KilaniConcession, which contains the Sidi El Kilanioilfield (SLK).

ARGAS to ExpandGeo Services InternationallyKSA-founded Arabian Geophysical & SurveyingCompany (ARGAS), the largest seismicacquisition company in MENA, is to expand itsbusiness internationally, further building on astrong track record which has made it a leadingregional success story in the oil and gas fieldservices industry.

Industrialization and Energy ServicesCompany (TAQA) and Paris-based CGG jointly

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announced the signing of a new agreement thatwill allow ARGAS to expand its offering inintegrated marine and land seismic solutions toOil & Gas industry customers all over the world,giving it the ability to access potential multi-billion dollar markets.

The agreement waives all territorial, technical,commercial exclusivities and any other restrictionspreviously in place, as well as all other contractualrestrictions on CGG or any of its current orprevious affiliates.

Reflecting ARGAS’s new global ambitions,shareholders also agreed to use this corporatemilestone to launch a new ARGAS logo whichthey believe reflects the company’s dynamismand agility.

Equinor Divests itsStakes in Lundin EnergyEquinor ASA has divested its financialshareholding in Lundin Energy AB,comprising around 14 million shares andcorresponding to its 4.88% percent of the sharesand votes, at a total sale price of approximatelySEK 3.3 billion. After the divestment, EquinorASA will no longer hold any shares in LundinEnergy AB.

“This transaction follows our divestment of a 16percent shareholding in Lundin in July 2019 andconcludes what has been a successful investmentfor Equinor. We have created significant valueand increased our direct exposure in the JohanSverdrup field. Although we are now no longera shareholder in Lundin, we continue to considerthe company a strong partner on the NorwegianContinental Shelf,” said Lars Christian Bacher,CFO of Equinor ASA.

Shell and Eni seeNigerian Lawsuit Dismissed in UKA UK court has ruled that England has nojurisdiction to try a case against Royal DutchShell and Eni brought to bear by the Nigeriangovernment as an Italian court is essentiallyhearing the same case.

Nigeria alleges the two supermajor companiesknew about bribes in a Nigerian oil deal trying

to secure rights to OPL 245 nearly 10 years agoand initiated a $1 billion lawsuit.

In a statement, Shell commented: “We maintainthat the 2011 settlement of long-standing legaldisputes related to OPL 245 was a fully legaltransaction with Eni and the Federal Governmentof Nigeria, represented by the most senior officialsof the relevant ministries,” Shell said in astatement.

The criminal proceedings in Italy are not affectedby the ruling of the London judge, where Nigeriahas a separate legal claim.

Global Petroleum to Delist from ASXAustralian junior independent Global PetroleumLimited, focused on oil and gas, upstreamexploration in Africa and the Mediterranean,formally applied to ASX requesting the removalof the company from the official list of ASXpursuant to ASX Listing Rule 17.11 and ASXhas accepted its application and resolved toremove the company from the Official List subjectto the satisfaction of certain conditions.

Global’s securities are currently listed/quoted ontwo securities exchanges – the Official List andAIM. Following due consideration/and in orderto streamline the company’s listing andcompliance costs, the Directors of Global resolvedthat the continued listing of the company’ssecurities on the Official List was no longer inthe best interests of the company and itsshareholders.

Saipem Signs 2-YearGlobal Frame Agreementwith Equinor for Engineering ServicesSaipme’s new Frame Agreement encompassesfeasibility and conceptual studies, FEED, detailedengineering and related follow-on and supportfor R&D activities, as well as assistance to Equinorfor its upcoming projects, including new energy-related projects in the onshore, offshore andfloating wind sectors.

The scope of the Frame Agreement extends, butis not limited to offshore trunklines includinglandfalls and flowlines, onshore pipelines,components, subsea structures, field layout and

routing design for products such as umbilicals,cables, static flexibles and power cables.

Saipem and Equinor have been collaborating forover a decade backed by frame agreements,namely those regarding transportation andinstallation (T&I) as well as Subsea Constructionworks. Furthermore, in October 2019 Saipemsigned a subsea service contract with Equinor,which entails the use of Saipem’s UnderwaterIntervention Drone (UID) Hydrone-R and the all-electric Work Class ROV Hydrone-W in the NjordField development. Last but not least, recentlySaipem and Equinor have signed a cooperationagreement to develop an innovative technologicalsolution for a solar panel floating park for nearcoastal installations.

Total Nixes GhanaAcquisition Deal with OXYIn August 2019, Total and Occidental Petroleumentered into a Purchase and Sale Agreement (PSA)in order for Total to acquire Anadarko’s assets inAfrica. Under this agreement, Total and Occidentalhave since completed the sale and purchase ofthe Mozambique and South Africa assets.

The PSA provided that the sale of the Ghanaassets was conditional upon the completion ofthe Algeria asset sale. Occidental has informedTotal that, as part of an understanding with theAlgerian authorities on the transfer ofAnadarko’s interests to Occidental, Occidentalwould not be in a position to sell its interestsin Algeria.

Given the extraordinary market environment andthe lack of visibility that the Group faces, and inlight of the non-operated nature of the interestsof Anadarko in Ghana, Total has decided not topursue the completion of the purchase of theGhana assets and, as a consequence, to preservethe Group’s financial flexibility.

“This decision not to pursue the completion ofthe purchase of the Ghana assets consolidates theGroup’s efforts in the control of its net investmentsthis year and provides financial flexibility to facethe uncertainties and opportunities linked to thecurrent environment,” said Patrick Pouyanné,Total Chairman and CEO.


AROUND THE WORLD

Fugro Completes Middle East’s FirstUncrewed Geophysical Route SurveyIn response to increasing demand for remoteoffshore services, Fugro has completed theMiddle East’s first fully autonomousgeophysical shallow-water route survey.Controlled from their remote operations centerin Abu Dhabi, an uncrewed surface vessel(USV) captured a full range of geophysicaldata across a survey area some 40 km outfrom the coast of Abu Dhabi to support aclient’s critical project entirely remotely.

The results of the fully autonomousgeophysical shallow-water route surveycomprised conductivity, temperature, depthand salinity (CTDS) profiles, bathymetry data,seabed imaging, sub-bottom profiles, andferrous object detection such as pipes, etc.The efficiency gains and material reductionsfrom using Fugro’s remote and autonomoussolution, rather than a conventionallymobilized and crewed survey, includedreduced HSSE exposure and significantclient cost savings. Fugro’s USVs also havea much lower carbon footprint than a regularsurvey vessels.

“Witnessing this ambitious concepttransformed into reality is a landmark momentin the Middle East that has resulted in thesuccessful delivery of a critical seabedcharacterization report based solely on ourautonomously acquired Geo-data,’ said GerardFerreira, Fugro’s Service Line Director forMarine Geophysics in the Middle East.

LOC Norway Awarded NewScope of Work on JohanSverdrup Field by EquinorLOC Stavanger has been awarded a newscope of work with Equinor, the Norwegianmultinational energy company. LOC willprovide Marine Warranty Surveyor (MWS)services for the SURF (subsea umbilical,risers and flowlines) development on theJohan Sverdrup oil field in the North Sea.The scope of work is for part of thePhase 2 development of the field. The Grouphas been providing MWS services on thedevelopment of the Johan Sverdrup fieldsince 2015.

The Group’s scope of work for this contractunder existing frame agreement, will includea review of the project, procedural andtechnical design documentation relating tomarine operations, as well as on-siteattendances to approve operations for projectcritical cargo, pipelines, cables, and umbilical.In addition, the SURF development includessubstantial subsea infrastructure of approx.100 kms of rigid pipelines.

Kevin Sirski, Managing Director/NavalArchitect at LOC Norway, commented: “LOCStavanger is very pleased to be continuingits work on the Johan Sverdrup Field withEquinor, a leading global energy company.We have been a long-term provider of MWSservices for Equinor on this field and we aredelighted that we will continue working onthis exciting development through to thecompletion of Phase 2 in 2022. We see thiscontract award as a testament to the high levelof service that we have provided on the projectsince being engaged back in 2015. It alsodemonstrates our leading position as an MWSprovider in the North Sea.”

Aker Solutions WinsUmbilicals Contractfor the King’s Quay in US GoMAker Solutions has been awarded a contractfrom Subsea 7 to deliver umbilicals forMurphy Oil’s King’s Quay development inthe U.S. Gulf of Mexico. The work scopeincludes 22 kms (14 miles) of dynamic steel-tube umbilicals and distribution equipmentto connect the King’s Quay floating productionsystem (FPS) to the Samurai, Khaleesi andMormont deepwater developments.

The King’s Quay semisubmersible FPS willbe located around 280 kms (175 miles) southof New Orleans in the Green Canyon area ofthe U.S. Gulf of Mexico.

The engineering, design and manufacturingof the umbilicals and distributionequipment will take place at Aker Solutions’facility in Mobile, Alabama in the UnitedStates. The work starts immediately andthe delivery is planned for the fourth quarterof 2021.

Global Oilfield Services DemandSet for a 25% Decline in 2020Global demand for oilfield services (OFS), measuredin the total value of exploration and production (E&P)company purchases, is set for a massive 25% yearlydrop in 2020 as a result of the Covid-19-causeddownturn, a Rystad Energy analysis shows. Spendingis expected at $481 billion this year and takes the firststep on the road to recovery in 2021, when it is forecastto tick up by just about 2%.

The recovery will accelerate further in 2022 and 2023,with OFS spending by E&Ps reaching some $552billion and $620 billion, respectively. Despite theboost, purchases will not return to the pre-Covid-19levels of $639 billion achieved in 2019.The comebackwill not be visible across all OFS segments from 2021,however. Well services and the pressure pumpingmarket will be the first to see a boost, while othermarkets will need to get further depressed beforerecovering.

Dividing OFS into six segments – maintenance andoperations, well services and commodities, drillingcontractors, subsea, EPCI and seismic – only the firstthree will manage to rise in 2021, while the latterthree will have to brace for another year of fallingrevenues before they can expect improvements.

In absolute numbers, the maintenance and operationssegment is poised for consecutive yearly rises in thenext three years after slumping to $167 billion thisyear from $202 billion in 2019. Ryatad expectsspending in this segment to recover to $175 billion in2021, $193 billion in 2022 and $205 billion in 2023.

The well services and commodities segment is set fora similar recovery, but only after slumping to $152billion in 2020 from $231 billion last year – the biggestdecline among segments in absolute numbers. HereRystand sees spending at $163 billion in 2021, $189billion in 2022 and $210 billion in 2023. The samepattern also applies to drilling contractors, with thesegment falling to $46 billion in 2020 from $62 billionlast year, and then rising to $47 billion in 2021, $54billion in 2022 and $57 billion in 2023.

The subsea segment, on the other hand, will fall from$25 billion in 2019 to $24 billion in 2020 and declinefurther to $22 billion in 2021 – before starting torebound to $24 billion in 2022 and to $29 billion in2023. Similarly, EPCI is set to fall to $81 billion in2020 from $105 billion last year. It will slide furtherto $74 billion in 2021, before rising back to $81 billionin 2022 and growing to $106 billion a year later.Lastly, seismic is poised to decline to $12 billionin 2020 from $15 billion in 2019. It will first keepdropping to $10 billion in 2021, beforerebounding to $11 billion in 2022 and to $13 billiona year later.

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Bathymetry showing a possible erosionalsurface with a hard rugged seabed

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Neptune Energy CompletesSafe Removal of Three Dutch PlatformsNeptune Energy has announced the safe removalof the L10-C, L10-D and L10-G platforms fromthe Dutch sector of the North Sea. The platformshave been providing offshore natural gas to theNetherlands for around 40 years and ceasedproduction in 2016.

More than 3,400 tonnes of steel – around half theweight of the Eiffel Tower – were removed aspart of the decommissioning program that wascarried out by Neptune Energy and Boskalis,using the Bokalift1 vessel. The steelwork wasremoved from the seabed and placed on the vesselin a series of carefully executed lifting operations.The removal of rock will return the seabed to aclean state and will mark the completion of thisextensive operation.

Lex de Groot, Managing Director of NeptuneEnergy in the Netherlands said: “These threeplatforms had come to the end of their economiclives and, as of the 1970s early 1980s, they havebeen producing Dutch offshore gas to heat ourhomes and fuel the economy.It’s our responsibilityto decommission these platforms, take everythingwith us and leave the seabed in a clean state. Ourteams did a tremendous job, together with oursupplier, Boskalis, especially given these turbulenttimes. The work was completed in a safe andsecure way, both for the crew and for theenvironment. All three platforms were broughtonshore and the associated materials will berecycled or reused as much as possible.”

The L10 Area continues to operate with gas beingproduced from numerous platforms centeredaround the Neptune-operated L10-A platform.

LUKOIL Starts Drillingat North Caspian ProspectsLUKOIL has started exploration and productiondrilling at prospects and fields in the northernareas of the Caspian Sea. LUKOIL started drillingof an exploration well at the Shirotno-Rakushechnaya prospect structure, located to thenorth of the V.I. Grayfer field. As the sea at thepoint of well is 4.5 meters deep, the well withthe target depth of 1,650 meters was drilled from

jack-up floating rig Astra, designed for shallowwaters. The same structural tectonic zone featuresYury Korchagin, Valery Grayfer and VladimirFilanovsky fields, discovered in 2000, 2001 and2005 respectively.

The company has also begun to study Khazri andTitonskaya features of a new block in the southof the same sea area within the East Sulakskybank, and is currently drilling the second well tothe target depth of 5,200 meters. The sea is 45meters deep at the point of well. Drilled at Khazrifeature from jack-up floating rig Neptune, thewell will deliver data on oil and gas content andexplore for oil and gas deposits in terrigenousand carbonate sediments of the Jurassic-Cretaceous period.

As part of its drilling campaign for Caspian fields,LUKOIL is constructing the sixth well at riserblock platform at the Yury Korchagin field. Thelength of the borehole of this horizontally directedproducing well with MultiNode intelligentcompletion system, used for the first time atCaspian projects is 5,164.79 meters. The drillingis performed from jack-up floating rig Mercury.The well’s daily target production rate of 348metric tons will allow to stabilize the field’sproduction.

Northern areas of the Caspian Sea has been thedomain for LUKOIL’s geological explorationsince 1995. The company started deep drilling in1999. Twenty-six prospecting and appraisal wellswere drilled at the company’s license areas. Eitherindependently or as a party to joint ventures,LUKOIL discovered 10 fields in the Caspian Seawith C1+C2 ultimate recoverable reserves ofhydrocarbons amounting to 7 billion barrels ofoil equivalent. Six of these 10 fields – V.Filanovsky, Y. Korchagin, Sarmatskoe,Khvalynskoye, and V. I. Grayfer are major multi-pay fields.

PGS Peru MegaSurvey -First Seismic Data Now AvailableFirst data is now available on PGS’ PeruMegaSurvey. This large-scale merged andmatched seismic dataset, including 2D and 3Ddata, provides E&P companies interested in SouthAmerica with an excellent opportunity to evaluateprospectivity on a regional basis.

Targeting the extensive coastline of Peru, thisPGS MegaSurvey comprises 21,000 sq km of 3Dseismic matched and merged together with approx.23,000 km of 2D data. A time-processed datasetis now available. Depth processing is ongoingusing a seismic-horizon-constrained velocitymodel through five different basins, from the

prolific Talara Basin in the north to the frontierbasins in the extreme south and depth results areexpected Q1 2021. Well control data will beincorporated using rock AVO for forwardmodeling and QI modeling

MegaSurveys are very large, merged, post-stackdatasets consisting of multiple surveys that havebeen rebinned to a common grid and then matchedto produce a phase-balanced and uniformly scaledcontiguous regional volume. Their regional naturepermits fuller exploration of tectonic and basindevelopments, leading to a greater understandingof existing and potential petroleum systems.

The PGS Peru MegaSurvey covers both existingdiscoveries and licensing opportunities in openblocks, revealing analogs of existing interests. Itcan be used to pick prospects or to evaluate thesuccesses and failures so far across the entireregion. Field-scale geological understanding cannow be placed in a basin-wide context.

Warrego Confirms Rig Selectionfor West Erregulla Appraisal WellsWarrego Energy has confirmed that the EP469joint venture has secured the Ensign 970 drillingrig for the upcoming exploration/appraisalcampaign at West Erregulla, onshore Perth Basin,Western Australia.

The exploration/appraisal plan provides for thedrilling of West Erregulla-3, located in the northernarea of the West Erregulla gas field, in the secondhalf of 2020 (subject to permitting), followed bythe West Erregulla-4 and potentially WestErregulla-5 in 2021.

RISC Advisory, which recently completed theindependent third-party certification of the WestErregulla resource for Warrego, agrees with thecompany’s estimated geological probability ofsuccess for the West Erregulla-3 well of 65%.

Warrego is supportive of the Operator’s view thatmaterial cost savings can be generated byincorporating West Erregulla-3 and 4, andpotentially 5, into the current exploration/appraisal plan.

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TGS Commences 2Dcubedseismic Project Offshore Timor-LesteTGS has announced that in collaboration withthe ANPM, it has commenced a 2Dcubed seismicdata project covering offshore Timor-Leste, insupport of the country’s ongoing license round.This project is fully supported by industry funding.

The project combines all available open file andTGS multi-client data across an area of over50,000 sq kms and incorporating over 2,500 linesand existing 3D’s within the planned area. The2D data, from over 45 legacy vintages, coversthe entire offshore area south of Timor-Lestewhere the 11 offshore blocks in the second licenseround are located.

The final multi-client 2Dcubed data will beunrivalled in its comprehensive coverage, allowingcustomers to develop structural and geological

models in their pre-study evaluation processusing a single conformable 3D volume,imparting confidence in their license rounddecision-making processes and supportingfurther exploration.

2Dcubed is a unique technology from TGS forgenerating a 3D seismic migration volume froma set of 2D and 3D seismic lines. It uses anadvanced structurally conformable interpolationalgorithm to maximize the potential of existing2D multi-vintage and 3D data. The volume canbe used for regional interpretation andoptimization of 2D survey designs and positioning.The very high density of the available 2D legacydata offshore Timor-Leste lends itself tomaximizing the effectiveness of 2Dcubed, whichalso merges local 3D surveys, where available.Similar projects have been undertaken in otherAsia Pacific basins in Indonesia and Australia to

industry acclaim, as well as offshore Sakhalin,Russia, and throughout the Norwegian and UKNorth Seas.

Availability of the first deliverables is expectedfrom July 2020, with final deliverables estimatedaround September 2020. This will allow E&Pcompanies ample time for data evaluation priorto the closing of the license round, which isanticipated to be during the first half of 2021.

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Documents

Contents€¦ · New Products & Services ... Dr. Tajudeen Umaru, Dr. Steven Dike, Mrs Lami Ahmed, Chief Pius Akinyelure, Malam Mohammed Lawal and Secretary of the Board, Mrs. Hadiza