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The Premier Source of Energy Intelligence on the African Market. News Update and Insightful Updates

01/01/2021

Angola Charges $1Million Entry Fee for Next Bid Round, to Launch in April 2021...
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Angola’s National Oil, Gas and Biofuels Agency (ANPG), as a national concessionaire, has announced its intention to hold an international tender for the award of new oil concessions in the country.

Nine blocks are on offer: three in the Terrestrial Basin of the Lower Congo and six in the Terrestrial Basin of the Kwanza. The contest opens 120 days from December 31, 2020, ANPG says. That is April 30, 2021.

This licence sale, which focuses on Blocks CON1, CON5 and CON6, of the Terrestrial Basin of the Lower Congo, and Blocks KON5, KON6, KON8, KON9, KON17 and KON20, of the Terrestrial Basin of Kwanza, “has a mandatory condition of participation the payment of an Entry Fee (Entry Free) in the amount of $1,000,000.00 (One Million United States Dollars), which will allow access to the Data Packages related to the basins to bid.

The deadline for the submission of proposals runs until June 9, 2021, in compliance with the 40 days provided for by law, and the opening ceremony for proposals will take place on June 10, 2021.

“This 2020 bid aims to relaunch the exploration and production of hydrocarbons in the terrestrial areas of the referred basins, to decrease the decline in production, by increasing the exploration and discovery of new resources, to stimulate the local creation of small and medium oil companies, to promote the incorporation of qualified Angolan labor, as well as fostering technological innovation and good governance practices. “

Paulino Jerónimo, Chairman of the Board of Directors of ANPG

The bid round is taking place under Law no. 10/04, of 12 November (Law of Petroleum Activities, amended by Law no. 5/19, of 18 April) and the aforementioned Presidential Decree No. 86/18, “to acquire the status of associate of the national concessionaire and to contract goods and services in the oil sector ”, Mr. Jerónimo explains.

“The National Concessionaire will communicate in due time the date and location of the technical presentations (roadshows), through an advertisement on the ANPG portal ( www.anpg.co.ao ), and in the national and international media”.

28/12/2020

SAVANNAH INKS REVISED GAS SALES AGREEMENT WITH LAFARGE...
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Savannah’s Accugas subsidiary has entered into a revised Gas Sales Agreement GSA with Lafarge Africa for the supply of gas to its Mfamosing cement plant in Cross River State, Nigeria.

The company says the new deal “establishes a more sustainable long-term contractual position for the benefit of both parties”.

The revised GSA sees the contract term with Lafarge extended for a further five years to January 2037, giving a remaining contract life of 17 years. The new agreement also allows for an increase in the gas sales price from 2027, with additional US-Consumer Price Index indexation from 1 January 2029.

The revised GSA has a reduction in the daily contracted quantity (DCQ) of gas from 38.7 MMscf/d to 24.2 MMscf/d. This reduction in the DCQ will allow Accugas to release approximately 12 MMscf/d of currently reserved gas processing capacity at its Central Processing Facility (CPF), enabling Accugas to enter into additional long-term GSAs for these volumes, which will increase the business’ future revenues and cashflow potential.

To compensate Accugas for this reduction in DCQ, the revised GSA includes an advance payment of $20Million and a prepayment structure over the period to 2027, which effectively results in a gas price of $7.50/Mscf on take-or-pay volumes during this period. “This revised structure also allows Lafarge to utilise its accumulated make-up gas balance of approximately $58Million, whilst we have preserved the capacity to supply higher volumes when these are required by Lafarge”, Savannah says in a statement. “Lafarge’s commitments under the revised GSA will continue to be guaranteed by an international investment grade bank guarantee.

“Overall, the revised terms are expected to have a cumulative positive impact on Accugas’ cash flows over the short and medium term. Following the agreement, Accugas’ aggregate maintenance-adjusted take or pay volume will reduce from 141.4 MMscf/d to 131.8 MMscf/d.
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28/12/2020

LEKOIL ASKS SHAREHOLDERS TO REBUFF METALLION'S ATTEMPT TO TAKE CONTROL...
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LEKOIL has told its shareholders that the requisition by Metallon Corporation, proposing three names to act as directors of LEKOIL, is “no more than an ill-disguised attempt by Metallon to gain control of your Company without paying a price to all shareholders that reflects the intrinsic value of the business and assets of the Company”.

It argues, in the letter, that Metallon is a poorly run gold mining firm with no idea about how to manage the affairs of a hydrocarbon, E&P business.

LEKOIL’s briefing suggests that it has clearly scrutinized Metallon’s financials, and determined that “Metallon has identified LEKOIL’s assets as an opportunity to address its own financial challenges”. If all of Metallon’s Requisitioned Resolutions are passed, LEKOIL’s Board contends, “Metallon’s appointees would represent 50% of the directors on the Board and, if Michael Ajukwu is elected Chairman, they will also have the casting vote. The Board does not believe that it would be appropriate for a c.15% shareholder, to enjoy that level of Board representation and control over the Company”.

Background: On 15 November 2020, LEKOIL received notice from Strand Hanson of its resignation as the Company’s nominated adviser, with effect from close of business on 20 November 2020 (resulting in trading in the Company’s shares being suspended from 23 November 2020). On the same date that Strand Hanson’s resignation took effect, the Company received Metallon’s requisition notice (together with the consent of the three proposed directors to act as directors of the Company).

LEKOIL’s letter is a blistering response to Metallon’s charges, in its requisition, that “a lack of accountability of management by the Board has led to shareholder value being destroyed.”
Visit our website www.africaoilgasreport.com for full details.
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28/12/2020

TOTAL AVERAGES 377,000 BARRELS A DAY IN ANGOLA'S BLOCK 17...
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French major TOTAL produced 377,673.9Barrels of Oil Per Day (BOPD) on average (operated, gross) in Block 17 in November 2020.

The French major was also active with the drill bit in the country, utilizing Maersk Drilling’s Maersk Voyager, on Block 17.

Chevron’s operated shallow water Block O produced 195,453BOPD.

BP’s operated deepwater Block 32 averaged 188,617BOPD in the month whereas ExxonMobil ‘s Block 15 averaged 129,763BOPD, according to figures from Angola’s Ministry of Finance.

The British player was the most active with the drillbit, utilizing Enso’s DS12 on Block 18 and Transocean’s Skyros on Block 32, reports.

Angola’s oil production in November 2020 was 36,559,945 barrels and corresponds to an average of 1,218,665Barrels of Oil Per Day (BOPD), reports the Angolan Oil, Gas and Biofuels Energy Agency (ANPG), the country’s hydrocarbon regulator.
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28/12/2020

IFC BOLSTERS SOUTH AFRICA'S RENEWABLE ENERGY CREDENTIALS...
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The International Finance Corporation (IFC), will provide up to $200Million to finance renewable energy projects in South Africa.

Nedbank, the country’s third largest lender, is the vehicle through which the facility will run.

“It is essential that we seize this opportunity to rethink the structure of our economies, to build a fairer, more resilient and low-carbon future,” declares Adamou Labara, IFC Country Director for South Africa.

Between 2011 and 2015, South Africa was the powerhouse of renewable energy in Africa and one of the most progressive supporters of green energy developments in the developing world

But all that came to an abrupt end, when Eskom, the country’s powerful utility, declared that renewables would escalate the cost of electricity in South Africa. Bid rounds for renewable energy projects were halted in the aftermath of that declaration.

Nedbank’s loan agreement with IFC is part of the signals that South Africa, which now has over 3,000MW of installed solar and wind power generating plants, is back in the renewable energy business.

“The loan agreement is part of the IFC’s efforts to develop South Africa’s climate finance market and support the South African government’s plan to move to a low-carbon economy”, IFC says in a release. “South Africa has set a target of reducing its greenhouse gas emissions by 42% by 2025 and diversifying its power generation to reduce its reliance on coal by 2050”.

Nedbank declares its “commitment to engage in alternative climate finance mechanisms that will further develop markets and support projects that create positive impacts aligned with UN sustainable development goals,”

Describing itself as “the first carbon neutral bank on the African continent”, Nedbank says it became, in 2019 “the first commercial bank in South Africa to launch a green bond on the Johannesburg Stock Exchange”.
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25/12/2020

Three tiers of winners are likely to emerge in the result of Nigeria’s marginal field bid round, according to indications at the Ministry of Petroleum Resources, in Abuja, the country’s capital.

The first tier refers to a list of two companies awarded the same field. The second tier is a list of three companies awarded the same field and the third tier refers to a list of companies numbering as many as 10, awarded the same field.

Not a single company is awarded a field, all by itself, Africa Oil+Gas Report checks indicate.

161 companies, in total, are on the three tiers.

Out of the 57 fields offered in the bid round, four fields are left unawarded, Africa Oil+Gas Report has learned, but we couldn’t confirm if those four fields include Abigborodo and Hely Creek, which were on offer at the time of bidding, but have since been ordered by a Federal High Court to be removed.

The matching of several companies to a field would suggest that payment of signature bonus, which is a determining factor in winning a field, will be shared.

A company might find itself the sole holder of a marginal field license in the event that the other company/ies matched to the field is/are unable to come up with its/their share of the signature bonus.

The three and half month-long bid round exercise was concluded on September 15, 2020 and the bid analysis, by the Department of Petroleum Resources (DPR), was concluded a month after and sent to President Muhammadu Buhari for approval.

But the process of approval of the award list has gone on for over two months, “because several of the companies who bid, paid all the fees and made it through all the milestones, had put so much pressure to be accommodated”, impeccable sources tell Africa Oil+Gas Report. “In the event, government was trying to please everybody and that is why you end up with 161 winners”.

When contacted, the DPR did not officially comment about these details. The agency did not also say when the result will be announced. Instead, its Head of Public Affairs, Paul Osu, simply said: “Successful candidates will be notified when the process is concluded”.

25/12/2020

New Age Energy (New Age), is hoping that the successful results of TOTAL’s South African drilling will lure E&P companies to farm in into its Algoa-Gamtoos Licence.

The company is embarking on the second exploration phase of the licence, which will run for two years from 17 November 2020.

The work programme during this period will include a further 300 km2 of 3D seismic data acquisition in the licence area.
But New Age is unlikely to invest in 3D seismic data acquisition, let alone drill a well on the licence. It’s not about having access to funds and resources. New Age Ltd is not wired to invest heavily in exploration technology. It focuses on looking for the assets and the farmos.

TOTAL operated Block 11B/12B,“ is located adjacent to the Algoa-Gamtoos license”, says Tower Resources, a minority partner to New Age Ltd on the acreage. “The Algoa-Gamtoos license also contains the southern deep-water basin margin of the Outeniqua Basin that was targeted by TOTAL’s Brulpadda and Luiperd-1X wells and is approximately 150 kms along strike to the East”.

The Luiperd-1X well encountered 73 metres of good quality net pay in 85 meters of gross sands in the main target interval andthe well reached a maximum constrained flow-rate through a 58/64″ choke of 33 million cubic feet per day of natural gas (‘MMcfpd’) and 4,320 barrels of condensate per day (‘bcpd’), an aggregate of approximately 9,820 barrels of oil equivalent per day (‘boepd’), according to reports. The choke configuration could not be increased due to surface equipment limitations.

New Age has reprocessed the existing 2D seismic data over the license during 2020. But that is all it would do. The company says that the effort has yielded a considerable improvement in resolution, and expects to have updated analysis and volumetrics available in January 2021, which will also be made available to potential farm-in partners.

25/12/2020

First speakers announced for Angola Energy Month...
For full report, kindly visit our website; www.africaoilgasreport.com

25/12/2020

Mozambique’s 450MW Gasfired Power Plant Now Certain of Going Ahead...
For full,l report, visit our website; www.africaoilgasreport.com.

25/12/2020

Tanzania’s Natural Gas Supply Sees A Spike from Mnazi Bay...
For full report, visit our website www.africaoilgasreport.com

25/12/2020

Japanese Contractor Wins the O&M Contract for Sangomar FPSO...
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