The Mauritanian British Business Council (MBBC) will partner with the MSGBC Oil, Gas&Power 2024 conference for the second consecutive year, linking British investors and companies with trade and investment opportunities in Mauritania.

The MBBC serves to promote sustainable development, share knowledge and best practices, and foster mutually beneficial partnerships between the two countries, offering guidance and support to UK businesses operating in Mauritania. The organization also leads trade missions to Mauritania and develops links with existing trade bodies and local chambers, supported by a robust network that includes British government departments, the Mauritanian Embassy in London and national and international organizations. Under the partnership, MBBC will promote energy investment opportunities to its members and attend the conference with a delegation of British businesses interested in entering or expanding within the Mauritanian market. 

Explore opportunities, foster partnerships and stay at the forefront of the MSGBC region’s oil, gas and power sector. Visit www.MSGBCOilGasandPower.com to secure your participation at the MSGBC Oil, Gas&Power 2024 conference. To sponsor or participate as a delegate, please contact sales@energycapitalpower.com.

UK companies have played a sizable role in Mauritania’s oil and gas sector to date. British multinational bp is set to produce first gas from its Greater Tortue Ahmeyim (GTA) project, in partnership with Kosmos Energy, by the end of 2024. With reserves of one billion cubic feet of gas, GTA will establish Mauritania as a major hydrocarbon producer, using export revenue to develop future gas projects like the BirAllah field. Last September, British multinational Shell spudded the PanaCotta-1 well in hopes of finding oil in the promising Block C10 offshore Mauritania.

Mauritania also presents attractive opportunities for UK energy companies in the green hydrogen sector, offering a myriad of prospects for British project developers, service companies and investors. In November 2022, bp signed an MOU with the government of Mauritania to explore the potential for large-scale green hydrogen production in the country, with several commercial projects since launched. The country’s vast co-located solar and wind resources, coupled with its proximity to Europe, positions it as a strategic potential exporter of green hydrogen to the UK amid growing demand for sustainable energies.

“MBBC is a partner of choice for MSGBC Oil, Gas&Power 2024, as the core value of the event is to foster investment and business collaboration with foreign investors. The presence of a British delegation in Dakar, backed by the MBBC, will contribute to leveraging Mauritania’s extractive resources for regional energy security and global export,” says Sandra Jeque, Event&Project Director at Energy Capital&Power.

Distributed by APO Group on behalf of Energy Capital&Power.

By NJ Ayuk, Executive Chairman, African Energy Chamber.

The major players on the world energy production stage are well known, and particularly in the field of oil and gas, where most of them have been in the game for a long time. In Africa, countries like Algeria, Nigeria, Libya, Egypt, and Angola have been in the business for decades, though much of their resource wealth remains untapped. When new discoveries come to light in nations previously unexplored or underexplored, one would think these more experienced countries would be able to out-hustle and out-muscle them when it comes to attracting investment dollars. However, recent experience shows that this is not always the case.

If there was a Rookie of the Year award in the energy business, it would go to the South American country of Guyana, hands down. Despite being the next-door neighbor of founding OPEC member Venezuela, most of Guyana’s potential 11-billion-barrel bonanza has only been discovered since 2015. Less than five years after its initial Stabroek Block discovery, U.S. oil giant ExxonMobil began producing oil through its Liza Phase 1 project — remarkably fast by industry standards. By April of this year, ExxonMobil had already approved its sixth oil development in Guyana, putting the country of just 800,000 people on track to someday surpass Venezuela in total crude production. The Latin American country is now one of the world’s fastest-growing economies.

This is not the first time I’ve brought up Guyana in discussions about Africa, and there’s a reason for that. Namibia is currently in the same position Guyana was in just a few short years ago, poised to choose its road ahead. Recent discoveries in Namibia’s Orange Basin suggest it could hold up to three billion barrels of oil and 8.7 trillion cubic feet of natural gas, and the country’s total oil reserves could be nearly equal to Guyana’s at around 11 billion barrels. Excitement around the newly discovered resources is high, and though oil and gas production still lie ahead, Namibia has become a leader in African oil and gas investment.

Shell (UK) and TotalEnergies (France), which made the major discoveries in the Orange Basin with partnering companies, have both committed substantial portions of their 2024 exploration budgets to ongoing activity in Namibia. Offshore exploration plans also have been announced by Chevron (U.S.), Azule Energy (a joint venture between Italy’s Eni and the UK’s bp), and Portuguese energy group Galp. Meanwhile, Reconnaissance Energy Africa (Canada) and Namibian state oil company NAMCOR have begun drilling an onshore oil and gas exploration well in northeast Namibia.

What Not to Do

The excitement about Guyana and Namibia’s resources is notably different than what we’re seeing in some of Africa’s other resource-rich nations. Take Nigeria, Africa’s largest oil producer by far. Despite colossal proven reserves of almost 37 billion barrels (the world’s total is 1.73 trillion), Nigeria is currently struggling to attract the $25 billion annual investment necessary just to keep its output at around 2 million barrels per day (bpd). Oil majors are divesting from Nigerian assets and diverting future investments to other countries, as TotalEnergies did when it announced $6 billion in new projects in Angola. A new exploration well hasn’t been drilled in Nigeria in more than 12 years. Why?

The most obvious reason is security. Nigeria is notorious for its environmentally disastrous spills caused by rampant oil theft, vandalism, and sabotage. The country’s inability to protect its most valuable economic asset — responsible for almost two-thirds of Nigeria’s revenue — is a constant threat to employee safety as well as the bottom line for oil producers, and it doesn’t help with public relations either. There may be a ton of money still beneath Nigerian soil, but it’s not going anywhere, so it simply makes more sense to go extract it somewhere safer until those problems get resolved.

The other major problem with operating in Nigeria is legal uncertainty. As TotalEnergies CEO Patrick Pouyanné has said, the Nigerian legislature loves to debate oil policy but rarely ever settles anything, leading to inconsistent decision-making and an unstable and erratic policy environment. Lack of transparency in licensing rounds, slow and complicated contracting procedures that expire too quickly, insufficient incentives for gas projects, and local manpower requirements not backed up by the education system are all significant obstacles. In addition, local companies that take over abandoned assets are held to lower environmental standards than international companies, meaning the problems are getting worse before they get better.

Nigeria is now belatedly trying to address some of these issues (While the 2021 Nigerian Industry Act was a tremendous step in the right direction, implementation has been moving forward at a snail’s pace), but it has already spent much of the good will it was afforded in the past.

Charting a Better Path

So, what are Guyana and Namibia doing right, and what are the takeaways for Nigeria and other African nations? Let’s begin with Guyana.

First and foremost, it recognized the urgency of taking action to develop its resources quickly. The global energy transition to renewables will eventually reduce the demand for fossil fuels, but for now, the transition is just getting started, and demand for fossil fuels remains high. With much of the country covered in rainy jungles and limited open land for wind farms, Guyana simply isn’t blessed with the same potential for renewables as many other countries and must take advantage of what it has. Guyana was determined to sell while the market was still buying before it’s too late. It made a point of fast-tracking development and updating laws and regulations to speed up the development process and provide a stable, investor-friendly regulatory environment.

One of the most immediate benefits Guyana offers is language in its petroleum contracts that protect energy companies from negative impacts if the government makes legislative or regulatory changes, such as new tax codes. This is known as a fiscal stability clause, and it can significantly reduce the time required for contract negotiations and the risk of costly project delays by preventing sudden and drastic changes in regulatory status. (As I’ve written, Namibia does not currently offer fiscal stability clauses in its agreements, but it would be well advised to if it wants to accelerate development of its newly discovered oilfields.)

Guyana’s Petroleum Activities Bill, passed by the National Assembly in August 2023 to update the Petroleum Act of 1986, grants the Natural Resources Minister extensive authority to oversee exploration, production, and licensing, as well as responsibility to enforce the law and apply fines. It addresses shortcomings of the old legislation, such as transportation and storage of hydrocarbons from offshore to onshore and obtaining access to oil feedstocks for any future refineries to keep them running if domestic production falls short. The bill also includes safety and emergency response measures, supervision and monitoring requirements, capacity-building requirements for energy companies, and a cross-border unitization framework for developing reserves that cross international boundaries.

In addition, Guyana’s assembly also passed local content legislation in 2021 that enables international oil companies to communicate their needs to local businesses effectively, creating opportunities for them to grow and provide the producers with services and skilled, educated personnel. This is in contrast to Nigeria’s local content laws, which include quotas for hiring local people but lack the provision for means to fulfill them. Guyana continues to fine-tune this policy with input from the Ministry of Natural Resources.

Namibia’s Strong Start

Although Namibia is still at an earlier stage of development, it hasn’t just been watching from the sidelines. The government has already begun work to update its tax laws and provide an enabling environment for upstream activity. Officials from NAMCOR visited Guyana in 2023 to learn more about oil developments, including how to involve local business, raise public awareness, and expand port facilities. They also learned from Guyana’s growing pains, noting that some of the best advice they received was to take their time and do proper infrastructure assessment.

The country is also getting a head start on diversification, with major law firm ENS assisting the government to come up with a regulatory framework for green hydrogen development and energy transition strategies. While much remains to be done, Namibia already finds itself in good position to offer energy companies who are headed for the exits in Nigeria and elsewhere a soft place to land.

Distributed by APO Group on behalf of African Energy Chamber.

International energy company Azule Energy – Angola’s largest independent equity producer of oil and gas – is developing the world’s first FPSO vessel that features carbon capture and storage (CCS) capabilities. The Agogo FPSO falls part of the broader Agogo Integrated West Hub Development in Block 15/06 and is expected to set a benchmark for sustainable oil and gas development across the region. Azule Energy’s CEO Adriano Mongini has joined the African Energy Week (AEW): Invest in African Energy 2024 conference as a speaker. During the event, Mongini is expected to provide insight into the company’s project pipeline, innovative infrastructure solutions and plans for expanding its presence regionally.

Azule Energy has set a target to increase production to 250,000 barrels per day (bpd) within the 2023-2026 period, leveraging new exploration campaigns as well as the development of large-scale projects to achieve this goal. The company signed Risk Service Contracts in December 2023 for Blocks 46, 47 and 18/15 – situated in the Lower Congo basin -, representing a step towards advancing deepwater oil and gas developments in Angola. Mongini will outline the company’s exploration plans at AEW: Invest in African Energy 2024, drawing insight into asset acquisition and future investments.

AEW: Invest in African Energy is the platform of choice for project operators, financiers, technology providers and government, and has emerged as the official place to sign deals in African energy. Visit www.AECWeek.com for more information about this exciting event.

With two billion barrels equivalent of net resources, stakes in 20 licenses and participation in the Angola LNG joint venture – operator of the Angola LNG plant – Azule Energy is both a strategic partner and competitive producer in Angola. One of the company’s largest developments is the Agogo Integrated West Hub development in Block 15/06, which is on track for production by 2026. The company aims to create a new production hub at the project, adding the Agogo FPSO vessel – currently under construction – to the block. With a capacity of 120,000 bpd and a gas injection capacity of 230 million cubic feet per day, the Agogo FPSO will join the active Ngoma FPSO to produce hydrocarbons from the Agogo and Ndungu fields. FID for the project was achieved in 2023.

Azule Energy is also the operator of the Cabinda Norte and Cabinda Centro blocks – situated onshore – and offshore Blocks 31, 15/06, 1/14, 18 and 28. Four FPSO vessels are also in operation with a capacity of 1.75 million bpd each. Meanwhile, Azule Energy is taking its expertise to regional markets. The company signed a farm-in agreement in May 2024 with exploration company Rhino Resources Namibia, securing a 42.5% interest in Block 2914A. Situated in PEL 85 in the Orange Basin, the asset is considered strategic given its close proximity to billion-barrel discoveries made in the basin since 2022. The agreement also represents the first international transaction by Azule Energy, reflecting its drive to develop oil and gas across the broader African continent.

On the natural gas side, Azule Energy is driving gas monetization efforts in Angola through its operatorship of the New Gas Consortium (NGC). The NGC is developing the country’s first non-associated gas project – the Quiluma and Maboqueiro fields – which will provide feedstock for the Angola LNG facility. Situated in the Northern Gas Complex in Angola, the fields will produce four billion cubic meters of gas per annum using two offshore platforms. The consortium made FID on the fields in 2022, with production expected to begin in 2026. Beyond the fields, Azule Energy is assessing future tie-ins to Blocks 2, 3 and 15/14, thereby ensuring the Angola LNG project has a steady supply of natural gas.

Beyond upstream projects, Azule Energy signed an agreement with Angola’s national oil company Sonangol in July 2024 to enhance decarbonization at the Luanda Refinery – Angola’s sole operating refining faacility. The parties agreed to assess the feasibility of constructing a biorefinery at the plant, with both Azule Energy and Sonangol providing technical and operational support. The refinery underwent an expansion in 2022, with the partners commissioning a new petrol production complex. The addition increased output from 395,000 liters per day to 1.5 million liters per day, aligning with Angola’s goal of becoming a regional hub for petroleum.

“Africa requires innovative, diversified oil and gas solutions in order to achieve energy security and drive industrialization. Companies like Azule Energy are making great strides in area by developing pioneering FPSO infrastructure and prioritizing production growth. The development of projects such as the Agogo Integrated West Hub development and the Quiluma and Maboqueiro fields will play a central part in increasing production in Angola,” states NJ Ayuk, Executive Chairman of the African Energy Chamber.

Distributed by APO Group on behalf of African Energy Chamber.

The African Petroleum Producers Organization (APPO) signed the African Energy Bank (http://apo-opa.co/3WAyFYG) into implementation in June 2024, kickstarting a new era of oil and gas financing in Africa. Offering an alternative source of funding for African hydrocarbon projects, the bank is expected to play a major part in advancing project development in both emerging and mature markets such as Angola.

APPO Secretary General Omar Farouk Ibrahim will speak at the Angola Oil&Gas (AOG) conference takin place on October 2-3 in Luanda. Ibrahim’s return to the conference reflects the growing importance of Angola as a major African producer and creates fresh opportunities for collaboration among APPO members, international oil companies and junior exploration and production companies.

AOG is the largest oil and gas event in Angola. Taking place with the full support of the Ministry of Mineral Resources, Oil and Gas; national oil company Sonangol; the National Oil, Gas and Biofuels Agency; the African Energy Chamber; and the Petroleum Derivatives Regulatory Institute, the event is a platform to sign deals and advance Angola’s oil and gas industry. To sponsor or participate as a delegate, please contact sales@energycapitalpower.com.

The African Energy Bank was created out of a need to enhance access to financing in Africa’s oil and gas industry. Given the catalyzing role hydrocarbons play in driving economic growth and energy security, the bank offers newfound avenues to finance and move projects forward. With an initial start-up capital of $5 billion – raised from $83 million in subscription fees by its member states ­– the bank’s implementation comes as Angola opens 29 blocks for exploration – including the country’s first-ever marginal fields. The strategic timing of the implementation creates greater opportunity for companies to finance new projects in Angola’s upstream sector.

In 2025, Angola will launch its next limited public tender (http://apo-opa.co/4bZS9dC), offering ten blocks for exploration in the Kwanza and Benguela basins. At present, 11 blocks are available on permanent offer as well as four onshore blocks. The country is also promoting investment in marginal fields – creating the opportunity for junior players to contribute to project development in basins with a commercial track record. As a founding member of APPO, Angola has leveraged its participation in the organization to strengthen its regulatory and legal landscape to entice investment in blocks opportunities. The country is recognized as both an attractive market to do business – given its strong regulatory frameworks – as well as a strategic market to invest – given its multi-year licensing structure and proven petroleum systems.

Meanwhile, APPO facilitates cooperation within the refining, petrochemical, transportation and distribution industries, engaging with member countries to promote fuel security in Africa. Angola itself has ambitions to become a regional petroleum hub, given its stable production and renewed focus on downstream infrastructure development. On the logistics side, Angola’s integrated terminal and logistics hub in Soyo – with a capacity to produce 65,000 barrels per day (bpd) and store two million barrels – will start operations in 2026. The project offers investors an exemption on imports and a ten-year tax holiday, Additionally, The Kwanza Terminal and Pipeline Routes Project – offering similar incentives to that of the Soyo project – will start operations in 2029. The project will produce 25,000 bpd with a storage capacity of one million barrels.

Meanwhile, on the refining side, Angola has three new refineries under construction aimed at enhancing capacity and supporting regional petroleum distribution. These include the 200,000 bpd Lobito refinery, coming online by 2026; the 100,000 bpd Soyo refinery, coming online in 2025; and the 60,000 bpd Cabinda refinery, the first phase of which will come online in 2024. During AOG 2024, Ibrahim will discuss the impact these developments will have on Africa’s energy security and the need to increase investment in oil and gas projects.

Distributed by APO Group on behalf of African Energy Chamber.