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Equatorial Guinea awards three exploration blocks to international independents

Punta Europa houses Equatorial Guinea's gas infrastructure including an LNG and LPG plant.

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Equatorial Guinea has awarded offshore exploration blocks to Panoro Energy and Africa Oil Corp. as it seeks to unlock additional reserves and reverse production decline. Earlier this month, the country appointed the former head of its national oil company, Antonio Oburu Ondo, to replace Gabriel Obiang Lima as Minister of Mines and Hydrocarbons.

Infrastructure-led exploration

Amongst the newly awarded blocks are Block EG-01 and Block EG-31 that are located next to producing and processing infrastructure.

The shallow water Block EG-01 has been awarded to Panoro Energy (operator, 56%) with partners Kosmos Energy (24%) and national oil company GEPetrol (20%). The block is located next to the Ceiba and Okume fields, two fields operated by Trident Energy via the 160,000 bpd Sendje Ceiba FPSO. Output currently stands at some 30,000 bpd.

Map: Panoro Energy

Panoro Energy and Kosmos Energy are already partners of Trident Energy on the Ceiba and Okume complex and hold interest in the exploration Block S where a well is planned for 2024.

“The partners have been awarded block EG-01 for an initial period of three years during which they will conduct subsurface studies based on existing seismic data to further define and evaluate the prospectivity of the block. Following this, the partners will have the option to enter into a further two-year period, during which they will undertake to drill one exploration well,” Panoro Energy said in a statement.  

On the other side, Africa Oil Corp. has been awarded shallow water Block EG-31 as operator with an 80% interest while GEPetrol holds the remaining 20%. The block is located next to the Marathon Oil Corp-operated Alba gas field and the onshore Punta Europa gas hub that houses the EG LNG export terminal. “Potential future discoveries could present low-cost, low-risk gas development opportunities targeting international LNG markets,” Africa Oil Corp. said in a statement.

Rio Muni exploration

Finally, Africa Oil Corp. has been awarded Block EG-18, which it had already secured during EG Ronda 2019. The award marks an evolution of the company’s acquisition strategy which had so far focused mostly on cash flowing producing assets.

“In Block EG-18 the Company has identified a potentially large and highly prospective basin floor fan prospect of Cretaceous age, that is similar to those within the Company's exploration portfolio in Namibia and South Africa,” Africa Oil Corp. added.

All PSCs for the blocks are yet to be ratified by the Government and there minimum work programmes do not include drilling commitments. However, their awards to reputable E&P investors send strong signals on the appetite for upstream activity in the Gulf of Guinea.  

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BREAKING: Côte d’Ivoire to award seven new oil & gas blocks to Murphy Oil and PETROCI

Last Wednesday, Côte d’Ivoire’s Cabinet approved the signing of production sharing contracts (PSCs) for blocks CI-102, CI-103, CI-502, CI-531, and CI-709 with MURPHY Exploration & Production; and of blocks CI-523 and CI-525 with its national oil company PETROCI. Hawilti reported last September that both the American independent and PETROCI had expressed interest for the blocks. Independent operator Perenco was also believed to be in negotiations to acquire blocks CI-523 and CI-525. Several of these licenses hold undeveloped oil & gas discoveries that could be brought on stream relatively quickly. Murphy Oil Corporation The new portfolio of Murphy E&P, a subsidiary of Texas-headquartered Murphy Oil Corp., is particularly attractive. Blocks CI-102, CI-531, CI-103 and CI-709 form a straight column that stretches from the shallow waters offshore Abidjan all the way to deep-offshore areas where several wells have been drilled. CI-103 notably holds the Paon deep-water gas and light oil field discovered by Tullow Oil in 2012 and already appraised. In 2019, independent operator EnQuest had entered negotiations to acquire the block without reaching an agreement. Just north of Paon, Tullow Oil had also drilled the Calao-1X well in 2013, within current block CI-531. The independent had found good quality reservoir sandstone, although they were water bearing. CI-709 finally holds development potential thanks to wells previously drilled by Anadarko Petroleum in 2016 and 2017, although commercial quantities are yet to be proven. These include Pelican-1X that intersected around 21.3m of net oil pay in two separate interval, Rossignol-1X that encountered well-developed sands and roughly 4.6 m of net oil pay on water, and finally Colibri-1X that also hit hydrocarbon pay. PETROCI goes for gas On its side, PETROCI will acquire blocks CI-523 and CI-525 that hold the Ibex, Gnou, Kudu, and Eland gas fields. Both blocks are in shallow water next to the maritime border with Ghana and had previously been awarded to Taleveras and Afren and eventually to Vitol before the trader relinquished them in 2020. Interest for exploration in Côte d’Ivoire has been soaring since Italian major Eni announced a discovery at its Baleine-1X well in 2021. The discovery was appraised by the Baleine East-1X well in 2022, confirming some 2.5 bn barrels of oil and 3.3 Tcf of gas across blocks CI-101 and CI-802. In December last year, Tullow Oil had expanded its presence in the Tano Basin with the signing of a PSC for offshore exploration licence CI-803, which is adjacent to its CI-524 block where a well could be drilled in 2024. Significant prospectivity has been identified within the proven Cretaceous turbidite plays there, similar to the plays which are producing in the TEN and Jubilee Fields across the maritime border with Ghana.

Hawilti launches “Gas for Africa” report with the International Gas Union (IGU), AU-AFREC, and AFC

Hawilti released an important new study on Gas for Africa in partnership with the International Gas Union (IGU), assessing the potential for domestic gas resources to energise Africa in line with the global energy transition. The African Energy Commission (AU-AFREC) and the Africa Finance Corporation endorse the report and its findings. The study starts by analysing current energy poverty trends in Africa, a continent with the lowest electricity per capita consumption in the world and the lowest CO2 per capita emissions. It argues for a pragmatic use of natural gas reserves to support a broad industrial and economic development of Africa in a way that is sustainable and enables a just energy transition. Mickael Vogel, Director & Head of Research, Hawilti “Energy poverty in Africa often boils down to the number of people without access to electricity – 600 million, or without access to clean cooking – 970 million. Unfortunately, this assessment misses the point and can lead to responses and solutions that are ill-adapted to Africa’s development needs. As it argues for a better use of gas, the report calls for more ambitious targets around energy access so that we can both bridge Africa’s energy deficit but also support economic growth and industrialisation.” The ”Gas for Africa” report highlights several ways in which gas can have a positive impact on Africa’s socio-economic development including by switching away from coal and diesel, developing energy-intensive industries and gas-based industrialisation, displacing fuelwood and biomass in households, generating baseload electricity to integrate intermittent energies, and building gas systems that can be decarbonisable in the future with hydrogen, renewable gas, and CCUS. However, a pragmatic utilisation of Africa’s 18 Tcm of proven gas reserves – or 9% of the world’s reserves – calls for a reorientation towards domestic monetisation. Most of the gas produced in sub-Saharan Africa remains exported, with local consumption still limited because of limited infrastructure availability. Additional barriers include limited access to capital, security risks, and policy uncertaint.y To overcome these key barriers to development, a total of eight guiding principles are given as recommendations to help stakeholders and policy makers navigate the complexity of the gas industry: The full report is available for download here.