Info!
UPDATED 1 Sept: The EI library in London is temporarily closed to the public, as a precautionary measure in light of the ongoing COVID-19 situation. From 1 September, the library will be staffed Tuesday-Thursday, meaning some services including loans of hard copy materials can resume. The Knowledge Service will still be answering email queries via email , or via live chats during working hours (09:15-17:00 GMT). Our e-library is always open for members here: eLibrary , for full-text access to over 200 e-books and millions of articles. Thank you for your patience.

A turning point for Central Africa’s gas industry?

The African Energy Chamber believes that the recently announced entry of Chevron into Equatorial Guinea and Cameroon as operator for the offshore gas mega-hub could be transformational for the future of gas in Central Africa.

The acquisition of
Noble Energy by Chevron for $13bn gives the US major an entry into Equatorial Guinea’s oil and gas sector, where Noble Energy has interests in the Alba field (33% non-operated working interest (WI) and 32% revenue interest), block O (Alen field 51% operated WI and 45% revenue interest) and block I (Aseng field, 40% operated WI and 38% revenue interest). These assets in Equatorial Guinea represent 94mn boe of proved developed reserves and 38mn boe of proved undeveloped reserves. In addition, Noble Energy was also the operator of the YoYo block in Cameroon and of the deepwater Doujou Dak block (60% WI) in Gabon, where it was in the process of evaluating recently acquired 3D seismic data.

The acquisition has raised several concerns and questions, says the African Energy Chamber, mostly because these assets are currently focus of the CEMAC [Economic and Monetary Community of Central Africa] region’s most ambitious gas development project. While the Alba field has been feeding gas into Equatorial Guinea’s Punta Europa complex for decades, including the EG LNG plant, the AMPCO methanol plant and the Alba LPG plant, its declining reserves have led to the development of the Alen and Aseng fields as alternative sources of gas. In 2019, Noble Energy was at the heart of a ground-breaking agreement to launch the Alen monetisation project, expected to ensure continued and stable gas supply to Equatorial Guinea’s LNG and downstream revenue-generating infrastructure.

The project is still on track for delivery in 2021 and is the first step of the development of a much broader offshore gas mega-hub in the Gulf of Guinea. This regional gas hub would ultimately include the development of the Yolanda and YoYo discoveries located in Equatorial Guinea’s block I and Cameroon’s YoYo block, both operated by Noble.

The scheme is one of the most ambitious cross-border gas ventures in Africa, and Noble’s acquisition by Chevron has the industry worried about the future of the project under new operatorship. However, the African Energy Chamber believes that the entry of Chevron as operator for the offshore gas mega-hub could be transformational for the future of gas in Central Africa, especially at a time when Equatorial Guinea, Cameroon, Gabon and Congo are all multiplying efforts to monetise their domestic gas reserves.

Chevron is a true gas player in the African market. In Nigeria, it has been leading natural gas commercialisation efforts for decades through its Escravos projects targeting the monetisation of 18tn cf of gas. These have resulted in the Escravos gas-to-liquids facility and the Escravos gas plant, both cornerstones of Nigeria’s gas development strategy. In Angola’s block 0 and block 14, Chevron has invested in cutting flaring and monetising gas. In block 0, it still operates what is the world’s largest LPG FPSO vessel, turning previously flared gas into cleaner fuels for Africans and the for the world, reports the African Energy Chamber.

‘What we need now is a pragmatic common-sense approach that welcomes credible investors and sees gas taking the lead in economic development and industrialisation. Therefore, the entry of Chevron is extremely welcomed and should be accepted by all stakeholders,’ says NJ Ayuk, Executive Chairman at the African Energy Chamber. ‘Transaction and projects approvals should not be unnecessarily delayed, ensuring a quick and efficient takeover in the region so ongoing gas projects are not affected. This acquisition gives the region a very experienced and credible gas player with tried, true and tested solutions to support our gas ambitions. The Chamber believes that fast tracking approvals and driving common-sense measures around this deal will make the industry work.’

‘From its Nigerian and Angolan presence, Chevron understands the issues and opportunities of developing African content. We expect its entry to be beneficial from a local content and capacity building perspective,’ adds Leoncio Amada NZE, President for the CEMAC region at the African Energy Chamber.

News Item details


Journal title: Petroleum Review

Countries: Equatorial Guinea - Africa -

Subjects: Exploration and production - Oil and gas - Gas markets -

Please login to save this item