Upstream

Azule Energy has signed an Agreement for Preliminary Activities (APA) with Yinson Azalea Production Pte Ltd to commence all preliminary activities for the provision, operation and maintenance of a FPSO asset for the Agogo Integrated West Hub Development Project offshore Angola. Agogo will be the third FPSO on Block 15/06, operated by Eni Angola (now part of Azule Energy). The field was discovered in 2019 as part of Eni Angola’s very successful infrastructure-led exploration strategy in the country. Tenders were issued by Eni in July 2021 for a project targeting a peak production of 120,000 bopd. Yinson is in charge of providing the FPSO, whose hull will be converted at the Huarun Dadong Dockyard in China. Full details on the development of Block 15/06 are available in the “Projects” section within your Hawilti+ research terminal.

Perenco has confirmed a new oil discovery within the Tchibeli North East pre-salt Vandji exploration prospect on its PNGF Sud shallow water permit in Congo-Brazzaville. “Good oil and gas shows were recorded on entry into the reservoir and a 75m oil column was interpreted on logs. A test of these zones produced at 2,000 bopd, followed by other analysis necessary to help confirm volumes,” the operator said. The company believes the new discovery could be a play opener in the pre-salt Congo, and holds a number of additional Vandji leads it could drill on the block. The block was a large shallow water permit initially awarded to Elf (now TotalEnergies) in the 1960s, which started producing in 1987. It was taken over by a partnership led by independent Perenco in January 2017 along with Hemla E&P Congo Continent Congo, Africa Oil & Gas Corporation and Petro Congo. PNGF Sud remains a mature oil asset holding significant remaining potential, with significant infrastructure in place. Nine steel jackets are currently installed and act as drilling or processing centers, supporting 67 producing wells across five fields in 2022: Tchibouela, Tchendo, Tchibeli, Litanzi and Tchibouela East. The partnership is currently executing several brownfield projects on the block to boost production, with up to six wells scheduled for 2023. Full details on the development of PNGF Sud are available in the “Projects” section within your Hawilti+ research terminal.

Eco (Atlantic) Oil & Gas has announced that its shallow water Gazania-1 well within Block 2B offshore South Africa did not encounter commercial hydrocarbons. The well was the fourth one to be drilled this year in the Orange Basin following Graff-1 (Shell), Venus-1 (TotalEnergies) and La Rona-1 (Shell). Gazania-1 is the only disappointing one so far. Gazania-1 was considered to be a near-term low-risk well, and its prospect’s size had best estimate prospective resources of 300 million barrels. More importantly, the well had a 60% chance of success and targeted an updip section of the already discovered A-J reservoir, along with overlapping potential reservoirs. “Gases normally associated with light oil were encountered throughout the drilling of the Gazania-1 well. This, in our view, confirms the active hydrocarbon system, proven by the A-J1 discovery well in 1988, extends to the part of the basin where the Gazania-1 well is located. Further seismic interpretation will likely lead to the definition of viable areas for trapping downdip of Gazania-1 closer to the 1988 oil discovery A-J1,” Eco Atlantic COO Colin Kinley said in a statement. But this is just the beginning for drilling in the Orange Basin, which straddles both Namibia and South Africa. In Namibia, Shell is about to resume drilling on PEL 39 where it has already discovered oil & gas earlier this year at Graff and La Rona. The Deepsea Bollsta has been contracted for the campaign set to start by the end of 2022 and last for a year. Meanwhile, TotalEnergies is expected to start appraisal drilling soon around Venus in Namibia which could be the biggest African discovery ever made. In South Africa, the French is also planning several key exploratory wells in 2023 and 2024 on Block 5/6/7 and DWOB. Meanwhile, Eco Atlantic itself will be part of another exploratory drilling campaign next year on two wells within Block 3B/4B, operated by Africa Oil Corp and where the un-risked prospective resource is estimated at over 3bn barrels of oil and liquids and over 1.3 Tcf of gas.

Invictus Energy has reported fluorescence end elevated gas shows of up to 65 times above background levels in the Upper Angwa primary target of its Mukuy-1 well onshore Zimbabwe. The well is yet to reach total depth and has confimed a working conventional hydrocarbon system in the Cabora Bassin. “We still have several hundred metres of drilling through our primary targets with additional potential, which will be followed by a comprehensive wireline logging programme to evaluate results, with the aim of confirming the presence of moveable hydrocarbons in multiple zones,” said Scott Mcmillan, Managing Director of Invictus Energy. The company and its drilling contractor, EXALO Drilling, have encountered a few technical issues during the campaign that have slowed down drilling progress. However, a recent changeout of the downhole drilling motor has allowed operations to continue and the Exalo 202 Rig will now recommence drilling through the primary targets. What’s at Stake at Cabora Bassa? Thought to potentially be the largest undrilled structure onshore Africa, the Mukuyu pospect is subject to intense scrutiny for its potential to transform Zimbabwe’s energy landscape. The prospect is being drilled amidst favourable market conditions and a growing appetite for gas in Zimbabwe and Southern Africa. The Mukuyu Prospect alone is estimated to contain 20 Tcf of gas and 845 million barrels of conventional gas / condensate (gross mean unrisked) across 5 horizons.

Reconnaissance Energy Africa has announced that’s its first wildcat onshore Zimbabwe, the Makandina 8-2 well, has been a geological success but failed to show commercial quantities of hydrocarbons. The well reached total depth in mid-August and confirmed the presence of a working petroleum system by encountering intervals rich with methane and hydrocarbon gas liquids such as ethane, butane, and propane. “Although geologically a successful well, economic accumulations of hydrocarbons were not encountered,” ReconAfrica said in a statement. The company is now proceeding with its plans for the second well, Wisdom 5-1, whose spudding is expected in mid-December. It is also extended its 2D seismic acquisition programme with an additional 1,500 linear km approved to be acquired between November 2022 and April 2023.

Angola’s National Oil, Gas and Biofuels Agency (ANPG) has announced a new discovery at the Bavuca Sul-1 well on Block 15. The block is operated by ExxonMobil (36%) in partnership with Azule Energy (42%), Equinor (12%) and Sonangol E&P (10%). ExxonMobil is currently executing a redevelopment programme on the block, following a June 2019 agreement with the ANPG to boost production. The operator is expecting to increase output by 40,000 barrels of oil per day (bopd) by executing a multi-year drilling program and install new infrastructure technology to increase capacity of the existing flowlines. The Valaris DS-9 drillship was contracted for the drilling campaign, under a 2-year contract from June 2022 to June 2024. Phase one of drilling is targeting 17 wells while Phase 2 targets about 20 wells. Valaris had already announced the drilling of the exploration well at the end of September 2022, but without providing further details.   “The well encountered 30 meters (98 feet) of high-quality sandstone containing hydrocarbons (…) at a water depth of 1,100 meters (3,608 feet),” the ANPG said today. Bavuca Sul-1 marks the 18th discovery on Block 15, where the Kizomba A FPSO started producing in 2004 followed by the Kizomba B FPSO in 2005. No new discovery had been made on the block since that of Bavuca in 2003.

Sonadrill, the joint-venture between Seadrill and Sonangol, has secured a 12-well extension in Angola for the Libongos drillship, Seadrill announced today. The firm portion of the contract is worth $327m with commencement expected in Q4 2022 with a firm-term of approximately 25 months. The Libongos drillship was already under a multi-year contract with Eni Angola, Hawilti’s Offshore Rigs Tracker shows. The unit is reported to have been part of the company’s drilling campaign on Block 15/06, where Eni has made seven discoveries over the past four years and is executing several subsea tie-back projects on the block. Eni Angola, which now forms part of Azule Energy with bp Angola, is also progressing the full field development of Agogo on Block 15/06. Tenders were issued in July 2021 for a project targeting a peak production of 120,000 bopd via the installation of a third FPSO unit on the block. The Libongos drillship is currently heading back to Block 15/06, data from Marine Traffic shows.

On November 1st, Addax Petroleum Development Nigeria Ltd signed a Transfer, Settlement and Exit Agreement (TSEA) with NNPC Ltd for offshore blocks OML 123, OML 124, OML 126, and OML 137. The subsidiary of the Sinopec Group has now ceased to be the production sharing contractor on these assets, after two decades operating in Nigeria. Much sought-after assets The operator had already been criticized for its lack of investment on the blocks, leading to the revocation of its licenses in March 2021 and their award to the consortium of Kaztec Engineering and Salvic Petroleum. However, an intervention by President Buhari had seen the blocks quickly returned to Addax Petroleum a month later. Throughout the rest of 2021, rumours circulated that another Nigerian consortium involving Mars E&P, a subsidiary of the AA&R Group, along with Kaztec Engineering and Salvic Petroleum was in the race to acquire Addax Petroleum’s interest in the four OMLs. AA&R notably announced in November 2021 a $274m senior secured reserve-based lending facility from the Afreximbank to support the acquisition. However, the deal eventually fell through and did not complete.   Addax’ blocks were originally awarded on a sole risk basis (100% interest) and are considered very attractive by the industry. Two of them are currently producing: OML 123 has been on production since 2006 via the Yinson-operated Adoon FPSO that develops the Antan Field, and OML 126 since 2005 via the BW Offshore-operated Sendje Berge FPSO that develops the Okwori and Nda Fields. The Adoon FPSO pumped an average of 16,400 barrels of oil per day (bopd) from January to September this year, according to NUPRC data. Its charter period expires at the end of 2022. Meanwhile, the FPSO Sendje Berge’s average output stood at under 4,500 bopd over the past few months and the vessel lease and operation contract was extended by another year until Q4 2022. On the other side, OML 137 remains undeveloped but is believed to be the most attractive asset because it holds significant gas resources that could be monetised domestically or via exports.

Borr Drilling’s Prospector 5 jackup drilling rig has reached the Central African coast where it is expected to start drilling soon for Eni Congo. In August 2022, Borr Drilling had announced the signing of a letter of intent worth $68.9m for Prospector 5 to execute a 6-well firm program expected to start in Q4 2022 with a duration of 14 months plus options. Hawilti got confirmation from Eni officials that the rig is indeed mobilized by the major offshore Congo. The campaign is expected to start with the drilling of two exploratory wells on Marine VI bis, a block operated by Eni in partnership with Congo’s national oil company, SNPC. The block holds several prospects that have been matured over the past few years, including Mbenga, Poalvou Deep, and Ikalou SW. While Eni is yet to reveal which prospect(s) will be targeted, the Prospector 5 is currently heading towards Poalvou, data from Marine Traffic shows. This will be the second rig mobilized by Eni offshore Congo, data from Hawilti’s Offshore Rigs Tracker shows. The Borr Natt rig has already been contracted by the Italian major since January 2022, under a contract set to end in January 2023, unless options are exercised. Once exploratory drilling is completed on Marine VI bis, the Prospector 5 will support development drilling on Marine XII, where Eni is developing gas reserves to start exporting LNG next year. The Prospector 5 rig will drill five development wells on Marine XII, according to SNPC. Market activity has steadily picked up in Congo over the past year, with drilling mostly focused on shallow water blocks. In its Q1 2022 Exploration Watch, Hawilti notably reported the drilling of the Lidongo Marine-1 well on Marine XI by Mercuria. According to company sources, the well successfully tested one zone and flowed oil. While the resumption of drilling is good news for Congo, a country that produces some 270,000 barrels of oil per day (bopd), more could be on the table. Last year, TotalEnergies announced it was planning to drill the Niamou prospect on Marine XX, a deep-water block it secured in February 2020. Along with its partner Woodside Energy, the French major believes that Niamou is a large attractive deep offshore prospect which could help maintain Congo’s output in the medium term. (article updated on 7 November 2022 to reflect details of the drilling campaign provided by SNPC.) More information on projects activity in the Republic of Congo is available on your Hawilti+ research terminal – plus.hawilti.com.

TechnipFMC foresees between $4.5bn and $7bn of subsea opportunities in Angola, Nigeria, and Côte d’Ivoire over the coming 24 months, according to its latest earnings presentation. Angola Angola will continue to dominate the market in terms of projects’ scope and value, as it has for the past couple of years. The implementation of an enabling environment and the granting of fiscal incentives by the Government there has translated into several new projects being approved by International Oil Companies (IOCs). Last July for instance, TotalEnergies took a final investment decision on the Begonia subsea tie-back, a 5-well development tied back to its Pazflor FPSO on Block 17. While several subsea tie-back projects have already been executed, more are in the making like the tie back of the Alho, Cominhos and Cominhos East (ACCE) fields to TotalEnergies’ Kaombo Norte FPSO on Block 32. TechnipFMC expects the subsea scope there to be worth up to $1bn. Meanwhile, new production hubs are also moving forward and will rely on the deployment of additional FPSO units. This is the case at Agogo on Azule Energy’s Block 15/06 where TechnipFMC expects the subsea scope to be worth over $1bn. On the same block, the development of additional reserves at the Cuica discovery could also support additional activity. The field was already tied-back to the Armada Olombendo FPSO in mid-2021 via an early production system (EPS) but its further development could represent up to $500m of subsea work, according to TechnipFMC. Finally, TechnipFMC expects the development of TotalEnergies’ Cameia field on Block 21 to be worth up to $500m in subsea opportunities. The development of the field benefits from fiscal incentives and will rely on a new FPSO unit. Bumi Armada is believed to have been shortlisted to provide the FPSO, with FID expected in 2024. Nigeria Despite ongoing turmoil, the Nigerian oil & gas sector is expected to rebound from 2023, after its presidential elections. TotalEnergies and Shell are both expected to approve brownfield projects there after years of hesitation. On OML 130, TotalEnergies has already restarted engineering work on its Preowei subsea tie-back project, a 70,000 bpd development that will rely on the Egina FPSO. TechnipFMC sees the subsea scope to be worth up to $1bn. Overall, OML 130 is expected to see renewed activity after the renewal of its PSC last August, with operator TotalEnergies planning a 9-well drilling campaign there that will start in a few months. Finally, Shell is expected to progress a few of its own deep-water projects on OML 118, where the production sharing contract (PSC) was renewed in May 2021. The major continues to consider three major projects on the block, including brownfield projects like Bonga North Tranche 1 (120,000 boepd at peak) and Bonga Main Life Extension & Upgrade (60,000 boepd at peak). It also has the option of developing Bonga Southwest, which would rely on a new FPSO and a unitization with the Aparo field, for a peak production of 150,000 boepd. TechnipFMC expects the subsea scope at Bonga North to be worth between $500m to $1bn, with pre-qualification documents issued by Shell in May this year. Bonga South West would be more significant as it would rely on a new FPSO, with subsea activity worth over $1bn. Côte d’Ivoire Finally, the phased development of Eni’s Baleine deep-water discovery in Côte d’Ivoire will support subsea activity in West Africa for the next couple of years. TechnipFMC notably expects the subsea scope of work to be worth up to $1bn. Phase 1, whose final investment decision (FID) was taken inearly 2022, is expected to be commissioned in 2023 with three wells producing an average of 12,000 barrels of oil per day (bopd) and 17.5 MMscfd of gas. It is expected to rely on the Firenze FPSO as a production hub: the vessel has been in Port Rashid (Dubai) since 2018 and is currently being refurbished before its redeployment offshore Côte d’Ivoire. In September 2022, Saipem already landed €1bn in contracts for the project’s initial phase, covering Engineering, Procurement, Construction and Installation (EPCI) activities of Subsea Umbilicals, Risers and Flowlines (SURF) and of an onshore gas pipeline, and the Engineering, Procurement, Construction and Commissioning activities on the refurbishment of the Firenze FPSO vessel. Details on future deep-water activity and projects in sub-Saharan Africa are available on the Hawilti+ research terminal – plus.hawilti.com.

Shell still has four major pre-FID options to develop its reserves offshore Nigeria, according to the major’s latest quarterly presentation. These represents the biggest share of the company’s pre-FID options across its global upstream portfolio. Most projects are concentrated on and around the Bonga deep-water field on OML 118, where the production sharing contract (PSC) was renewed in May 2021. Shell continues to consider three major projects on the block, including brownfield projects like Bonga North Tranche 1 (120,000 boepd at peak) and Bonga Main Life Extension & Upgrade (60,000 boepd at peak). It also has the option of developing Bonga Southwest, which would rely on a new FPSO and a unitization with the Aparo field, for a peak production of 150,000 boepd. The two brownfield projects are likely to be prioritized given their lower development costs. In May 2022, Shell notably started the tendering process for the Bonga North subsea tie-back project. The pre-qualification documents included three different packages:  the topsides modification of the Bonga FPSO (design engineering, procurement, transportation, fabrication, offshore installation and commissioning); the engineering, procurement and construction of flowlines, risers, umbilicals, and installation works; and the design, manufacture, and supply of subsea equipment and provision of healthcare support. The major also continues to make progress towards the development of the shallow-water HI gas field, in partnership with Nigerian independent Sunlink Petroleum. While the development concept has not been officially confirmed, the field is expected to be a key supplier of gas to Nigeria LNG’s upcoming Train 7.   Details on deep-water activity in Nigeria are available within your Hawilti+ research terminal.

Coastline Exploration has announced receipt of final authorization to proceed with its exploration programme in Somalia after paying a $7m signature bonus to the Somali Central Bank. The oil & gas independent had announced last February that it had signed seven Production Sharing Agreements (PSAs) for deep-water blocks offshore Somalia. “We want the first exploration well to start as soon as possible,” Somali President Hassan Sheikh Mohamud said in a statement. Based out of Houston, Coastline Exploration says it has invested over $50m in Somalia and has been engaged since 2018 on negotiating its offshore PSAs.

VAALCO Energy delivered First Oil to the Teli floating, storage, and offloading (FSO) vessel at its Etame Field offshore Gabon on October 18, the company has revealed. The installation of the FSO had been ongoing for several months to replace the previous Petróleo Nautipa FPSO vessel operated by BW Offshore, whose contract expired in September this year. Etame is VAALCO Energy’s flagship project with a net production to the company of some 10,000 barrels of oil per day (bopd) on average. A recent extension of the production sharing contract (PSC) until 2028 paved the way for the reconfiguration of the field and a new drilling campaign. In August 2021, VAALCO Energy signed a binding letter of intent with World Carrier Offshore Services Corp. to provide and operate a FSO unit for up to eight years with additional option periods available. The agreement eventually led to the execution of a Bareboat Contract and Operating Agreement with Greece’s World Carrier Corp. to provide and operate the new Teli FSO. In doing so, VAALCO Energy expects to reduce storage and offloading costs almost 50%, lower total operating costs by approximately 17% to 20% through 2030, and increase effective capacity for storage by over 50%. In total, and once the field is reconfigured, the agreement with World Carrier is expected to lead to annual operating expense savings of around $20 to $25m over the life of the new agreement, according to VAALCO. Meanwhile the company recently extended its ongoing drilling campaign on the block from four to six wells. The Etame 8HST, Avouma 3H-ST, South Tchibala 1HB-ST, and ETBNM 2H—ST have already been drilled this year, tracking data from the Hawilti+ research terminal shows.

Petralon 54 Ltd has announced that it recently held a meeting with its host and impacted communities around the Dawes Island Field south of Port Harcourt in the Niger Delta. The company officially presented its Petroleum Prospecting License No. 259 (PPL 259) to the Royal Fathers and the people ahead of starting sustained commercial production later this year. “The initiative was aimed at building mutual understanding between our organisation and the Ogoloma, Okochiri and Koniju communities in Okrika Local Government Area, Rivers State,” the company said today. Petralon 54 Ltd is a subsidiary of Petralon Energy, who was awarded PPL 259 in mid-2022 by the Federal Government of Nigeria, giving it operatorship of the Dawes Island Field. The group also holds an indirect minority interest in Prime Oil & Gas, which in turns entitles it to a net reflective production of some 3,000 barrels of oil equivalent per day (boepd) from the Agbami, Akpo, and Egina deep-water fields.

DNO has announced yesterday the acquisition of Mondoil Enterprises from Oslo-listed RAK Petroleum for a consideration of $117.25m. By acquiring Mondoil Enterprises in an all-share transaction, DNO gains a 33.33% indirect interest in Foxtrot International, operator of the producing block CI-27 and exploration block CI-12 in Côte d’Ivoire. “As DNO targets expansion beyond the Kurdistan region of Iraq and the North Sea, the move into Côte d’Ivoire is an important first step into a highly prospective region offering a broad set of growth opportunities through acquisition of producing fields, development assets and exploration licenses,” said Bjørn Dale, DNO’s Managing Director. The company also added that is it already evaluating other opportunities in Africa. A Significant Gas Asset Côte d’Ivoire’s offshore CI-27 Block represents one of West Africa’s most strategic gas assets as it produces and supplies natural gas to the country’s biggest power producers: CIPREL and Azito Energie. As a result, CI-27 continues until today to produce about 70% of the gas consumed on the Ivorian market, and ultimately providing power to millions of households and industries. The development of the block primarily focuses on the Foxtrot field, but also the Manta field discovered in 1981 by Phillips Petroleum, and the Mahi and Marlin fields discovered in 2005 and 2007 respectively by current operator, Foxtrot International. During the first half of 2022, gross sales averaged 200 MMscf/d of gas and 1,500 bpd of oil and condensate, DNO said. Over the 2020-2022 period, Foxtrot and its partners on CI-27 invested $350m into developing additional reserves and building new onshore facilities to increase gas production and processing capacity to 230 MMscf/d. The Sapura Berani rig was mobilized on the block this year, Hawilti’s Offshore Rigs Tracker shows. Three new wells and two side-track were drilled in total as part of the campaign. Côte d’Ivoire is emerging as a new oil & gas hub in West Africa Next to Nigeria and Ghana, Côte d’Ivoire has traditionally appeared as a less attractive market for oil & gas investments. While the country ambitioned to reach a production of 100,000 bopd this decade, output remains at below 25,000 bopd. However, fresh investments into power generation have justified the expansion of the country’s gas infrastructure while new offshore discoveries have repositioned it as an exploration frontier on the continent. The country’s two biggest thermal power producers, CIPREL and Azito Energie, are indeed both involved in expansion of their gas-to-power facilities around Abidjan. The ongoing Azito 4 expansion is adding 250 MW to Globeleq’s power complex in Yopougon, while Eranove is building a 390 MW plant in Jacqueville, known as Atinkou (CIPREL V). To supply feedstock to the new turbines, investments had to be made in gas production, processing, and distribution. To that purpose, Côte d’Ivoire’s Council of Ministers adopted in March 2020 four decrees that renewed the Exclusive Exploitation Authorizations of the Foxtrot (F Zone), Mahi, Manta and Marlin fields on block CI-27. Each decree extended the fields’ EEA by another ten years to ensure continued and reliable supplies of gas to the CIPREL V and Azito 4 power plants. Meanwhile, fresh exploration has yielded tremendous results offshore with the discovery of the Baleine field by Eni on blocks CI-101 and CI-802 in 2021. Baleine is one of sub-Saharan Africa’s biggest recent finds with 2.5 billion barrels of oil and 3.3 Tcf of gas discovered at the Baleine-1X well in 2021 and Baleine East-1X well in 2022. The development of the discovery was quickly approved by Côte d’Ivoire’s authorities and benefit from strong political support to fast-track the project and achieve first oil in 2023 (Phase 1). Such news has given hopes that this is just the beginning for Côte d’Ivoire’s oil & gas sector and more operators are expected to enter the market moving forward. In July 2022, Côte d’Ivoire’s Cabinet notably gave its greenlight for the negotiations of production sharing contracts (PSCs) for blocks CI-520, CI-521, and CI-522 with British independent Elephant Oil. Details on the development of block C-27 offshore Côte d’Ivoire are available in the “Projects” section within you Hawilti+ research terminal – plus.hawilti.com.

Petralon 54 Ltd, a subsidiary of Petralon Energy Ltd, is in active engagement with its host community in the Niger Delta and has commenced technical and operational activities to achieve production at the Dawes Island Field by the end of 2022, the company said today. The move follows the award of the Dawes Island Marginal Field to Petralon 54 Ltd in 2021 and the issuance of its license – Petroleum Prospecting License No. 259 (PPL 259) in June 2022. The company has revealed some of its strategic initiatives to enable seamless operations at Dawes Island and restart production to raise national output. Petralon is notably in active engagement with the Host Community and its stakeholders in the Dawes Island Field to identify critical projects for implementation as well as create a formidable working partnership between Petralon 54 and its host/impacted communities. These include the traditional institutions/Council of Chiefs, Community Development Committees and other stakeholders. The company has also actioned several technical and operational initiatives, including surface well head checks and first line maintenance of the existing well head, refurbishment/reinforcement of field location infrastructure, mobilization of early well test equipment and all required field operations support facilities. Upon completion, these projects will ensure a safe resumption of production activities at Dawes Island.

The Ministry of Hydrocarbons of the Democratic Republic of Congo (DRC) has officially opened today a new Bidding Round for 30 blocks across the country. The blocks are spread out across five different basins: Cuvette Central, Coastal Basin, Lake Tanganyika, Lake Kivu and the Albertine Graben. The Bid Round is supported by Xcalibur Multiphysics and is expected to close in April 2023. Interested parties are requested to send Expressions of by January 31st, 2023. Only registered, pre-qualified companies will be able to bid. According to authorities, the DRC contains oil resources estimated at around 22 billion barrels of oil and 66 billion barrels of methane gas in Lake Kivu. Independent operator Perenco already produces small quantities of oil and gas there, estimated at 25,000 barrels of oil equivalent per day (boepd). This marks the third bidding round to be launched in sub-Saharan Africa over the past 12 months after Mozambique in November 2021 and Sierra Leone in May this year.

Italian major Eni has announced the successful drilling and testing of the Baleine East-1X well within Block CI-802 offshore Côte d’Ivoire. This is the first well to be drilled in the block and targeting the Baleine structure discovered in 2021 in the adjacent Block CI-101. Results from the wells have allowed to increase the volumes of hydrocarbons in place at Baleine from 2bn barrels of oil and 2.4 Tcf of associated gas to 2.5bn barrels of oil and 3.3 Tcf of associated gas, Eni has revealed. The well is located 5km east of the Baleine-1X discovery well and reached  final depth of 3,165m (measured depth) in water depth of some 1,150m. “From the vertical borehole a horizontal drain of 850 m in length was subsequently drilled into the reservoir to perform a production test that confirmed a potential of at least 12,000 bbl/d of oil and 14 Mscf/d of associated gas of production from the well Baleine East 1X,” Eni said. In order to achieve First Oil from Baleine’s by H1 2023, Eni will be drilling a third well on the structure. The company expects to produce 12,000 bopd and 17.5 MMscf/d from Phase 1 next year before ramping up to at least 75,000 bopd and 140 MMscf/d in a second phase due in 2026.   Details on the ongoing development of the Baleine deepwater field are available in the “Projects” section within your Hawilti+ research terminal.

In this interview, Director General of The Petroleum Directorate of Sierra Leone (PDSL), Mr. Foday Mansaray, discusses the announcement of the nation’s newest and most exciting Licensing Round and the potential to explore for oil and gas in Sierra Leone. What is the current state of the 5th Offshore Licensing Round and what can you tell us about the prequalified companies and the opportunities they bring to Sierra Leone? Sierra Leone’s 5th Offshore Licensing Round was officially launched on 18 May 2022 during the African Energy Summit at the Mayfair Hotel in London. The Licensing Round will close on 30 September 2022 during which all interested companies are expected to submit their bids. Prequalified companies will be issued a ‘Notice of Qualification’ and subsequently be invited for negotiations. Having officially launched on 18 May 2002, we have only just completed a comprehensive list of international oil companies (IOCs) who have been ‘Specially Invited’ to apply for prequalification, where The Petroleum Directorate of Sierra Leone (PDSL) assesses their complete financial, technical and HSE capabilities. This list has been compiled taking cognisance of the IOCs’ global reputation and operational history. We are very optimistic of forming a long-lasting partnership between Sierra Leone and any number of these companies. As we speak, we have received applications from 3 companies; anything decided in the meantime will be communicated to the oil and gas community at the conclusion of the Licensing Round, post 30 September 2022. What are the steps set by PDSL that a bidder must follow in order to participate, specifically with regards to in-country regulation? There are 10 very simple and transparent steps that we have devised for companies to follow. We anticipate that it will take 85 calendar days from application to the ratification of a license. The process would follow the following steps: ● Pre-qualification: a given IOC will submit a formal application for pre-qualification that includes their Work Program, Technical and Financial Capabilities, Health, Safety & Environmental Policies and Corporate Social Responsibility Plan; all must be submitted with supporting documents;● PDSL will evaluate the IOC’s application and then issue a ‘Notice of Qualification’ for the 5th Licensing Round within 10 Business Days;● PDSL will invite the IOC for negotiations;● A Provisional License will be granted to the IOC, upon successful negotiations;● The IOC will either accept, or decline, the Provisional License;● If accepted, a Draft Petroleum Agreement is sent to the IOC for ‘No Objection’;● The Draft Petroleum Agreement is sent to the Ministry of Finance, the Attorney General & The Ministry of Justice for ‘No Objection’;● PDSL and the IOC sign the Petroleum Agreement;● The Petroleum Agreement is sent to Parliament for ratification;● The Parliament ratifies the Petroleum Agreement. What effect has the Licensing Round, including fiscal terms and company benefits offered, had in the successful promotion of Sierra Leone and its energy market? The Licensing Round has showcased Sierra Leone’s competitive fiscal terms and predictable regulatory framework, which has attracted interest from various IOCs. The feedback we have received thus far has been very encouraging and positive, especially around the efficiency, simplicity and transparency of our application and awards process. What is very apparent is that the round’s launch has been timely, as Sierra Leone seeks to fill the energy gap created as a result of the global shortage of access to oil and gas. What is the expected growth for Sierra Leone’s upstream segment, and what recent highlights and milestones can you share with us? I wholeheartedly believe that Sierra Leone is on the cusp of joining other oil and gas producing nations. Given the success story along the conjugate margin in Guyana, it is only a matter of time until Sierra Leone joins this illustrious group. Since April 2021, Innoson Oil and Gas (IOG) has been progressing its exploration work program by conducting comprehensive studies and analysis of our seismic data, coupled with remote sensing studies. Moreover, on 13 May 2022, IOG announced an estimated recoverable resource of 8.2 trillion cubic feet of gas and 234 million barrels of oil in their acreage; IOG’s findings have also been independently corroborated by the Ryder Scott Company. We look forward to the next steps of their work program, which will lead to a drilling campaign in the near future. With a proven working petroleum system with 4 discoveries, from a total of 8 wells drilled throughout its history, we have all the elements required to maintain a petroleum system where hydrocarbons can be found, such as: ● A high-quality mature type-2 source rock with a Hydrogen Index (HI) of 482-795, and a Total Organic Carbon (TOC) of 4-20%. Guyana’s HI and TOC are 450-613 and 4-10% (at Liza-1), respectively;● A migration path;● A reservoir rock;● Stratigraphic and Structural trapping mechanisms; and● Effective seals. All these have been proven in our basin, so we’ll keep a close eye on it. In past years, what binational and private cooperation would you highlight that has brought prosperity to Sierra Leone, and what do you expect to see in the next few years? PDSL has existing bilateral agreements with GNPC in Ghana, as well as the Ministry of Mines and Hydrocarbons of Equatorial Guinea. These agreements will enhance capacity building and enable Sierra Leone’s petroleum sector to learn valuable lessons from these producing nations. We are also currently actively engaged with ANPG, PASA and GNPC-Gambia to create a pathway for collaboration between our nations. I firmly believe that collaboration with like-minded institutions will provide an excellent platform for us during our exploration, development and eventual production. Africa Oil Week’s (AOW) latest edition is scheduled for the first week of October in Cape Town. What does PDSL expect to achieve from its participation? PDSL has been involved in strategic promotion and marketing of Sierra Leone’s potential and petroleum opportunities. We are always on a mission to form strategic partnerships with IOCs who share our vision of transparency, performance-driven attitude, keen sense of collaboration and drive to become a net producer of

The Ikike field will be put on production this month, said this morning Victor Bandele, Deputy Managing Director at TotalEnergies EP Nigeria. His remarks were made during the opening of the Nigerian Content Seminar in Abuja, which marks the start of DMG Events’ 21st NOG Conference & Exhibition. The Ikike field is developed as a tieback to the Amenam platform on OML 99 and has a targeted peak production of 32,000 barrels per day (bpd). Its final investment decision (FID) was taken back in January 2019. The project set new local content records, with an overall Nigerian content target of 90%. The project management was fully executed in-country, along with all the detailed and basic engineering. In total, the development of Ikike create over 3,000 direct jobs, according to TotalEnergies. Details on the development of the Amenam-Kpono hub are available in the “Projects” section within your Hawilti+ research terminal.

Earlier this week, Nigeria held a grand ceremony in Abuja to unveil its Host Communities Development Regulations and Petroleum Prospecting Licences (PPLs) under its newly-adopted Petroleum Industry Act (PIA). The regulations are expected to provide a more durable and sustainable framework to engage local communities in the development of the country’s oil and gas sector. The PPLs regulations, on the other side, are a departure from the former regime as they mark the end of Farm-out Agreements for marginal fields. Moving forward, marginal fields will be awarded following open, competitive tenders resulting in the award of a PPL. The PPLs currently have a term of three years which can be extended by an additional three years, making the licenses valid for six years in total. The ceremony held this week is the result of the 2020 Marginal Fields Bidding Round, where 540 applicants pre-qualified, out of which 161 were declared preferred bidders. According to Minister of Petroleum Resources Chief Timipre Sylva, the round was able to generate NGN 200bn in revenues to the Nigerian government. Successful awardees who were able to pay for their signature bonuses were given their PPLs this week. They now have to form special purpose vehicles (SPVs) with their partners to develop their fields, in what was called an “arranged marriage” by many new licence owners. “Nigeria is committed to implementing full beneficial ownership disclosure of the awardees through the development of a web-portal,” said Engr. Gbenga Komolafe, Chief Executive of the new Nigerian Upstream Petroleum Regulatory Commission (NUPRC). The list of awardees announced this week, including individual entities, their respective fields and PPL numbers, is available within your Hawilti+ research terminal at plus.hawilti.com.

In yet another deal within the Orange Basin, Eco (Atlantic) Oil & Gas has announced its acquisition of another 6.25% in South African block 3B/4B. The company already entered the block earlier this year when it acquired Azinam, who holds a 20% non-operated interest in the license. Eco Oil & Gas is acquiring its additional 6.25% from the Lunn Family Trust, one of the largest shareholders of Ricocure (Pty) Ltd. Ricocure is a 60% interest holding in Block 3B/4B. The license is located in the deep waters of the Orange Basin in the Southern African Atlantic coast, south of the maritime border between Namibia and South Africa. The zone is notably located along-trend of an emerging Mid-Cretaceous oil play where Shell and TotalEnergies discovered oil and gas at their respective Graff-1 and Venus-1 high-impact exploratory wells in Namibia in early 2022. Both wells were play-openers for a new petroleum province offshore Namibia and South Africa, which could be further proven with exploration on Blocks 3B/4B. The license has been subject to substantive exploration spending, including from previous operator BHP Billiton who acquired a 10,000km² GeoStreamer 3D survey in 2012, while Shell acquired a further 8,000km² of 3D to the north of the block at the same time. In addition to 3D seismic data, 1,400 km of multi vintage 2D seismic also spans the licence. Such data has allowed current partners, including new operator Africa Oil Corp since 2020, to identify an inventory of leads and prospects out of which Wolf, previously known as Aardwolf, could be subject to exploratory drilling. Details on the exploration of Block 3B/4B are available in the “Projects” section within your Hawilti+ research terminal.