Investors in Nigeria’s oil sector have been having a tough time of it as commercial-scale theft and sabotage have hurt operations and the country sits in regulatory limbo. Now there’s some bad news on taxation.
International oil companies have been lobbying hard to have the fiscal terms proposed in the now-famous draft Petroleum Industry Bill (PIB) diluted, but it doesn’t look like those efforts have paid off. The government hasn’t got any intention of compromising on its proposed tax regime, the minister of petroleum resources said, despite complaints that production could slump by 25 per cent if the legislation is passed in its current form. Continue reading »
Angola and Brazil have a lot in common: the Portuguese tongue, a delightful stretch of Atlantic coast and a reputation for beautiful people cavorting in beach-side bars. Brazil is Latin America’s powerhouse; Angola likes to think of itself, with some justification, as Africa’s emerging equivalent.
To oilmen and investors, however, the most intriguing thing the two nations share is a piece of geology that dates from the age of the dinosaurs, before the tectonic shifts that rent the landmass in which they were once conjoined. Continue reading »
Africa’s extractive industry has its fair share of challenges, but that hasn’t stopped the oil industry from charging ahead. Alongside traditional suppliers Angola and Nigeria, countries like Ghana and Equatorial Guinea are rapidly boosting their output. The continent holds 12 per cent of the world’s crude oil reserves.
It’s also means analysts and data providers need to catch up. Last week global energy data supplier Platts announced it is expanding its portfolio of African oil coverage, publishing daily price assessments for five West African grades of crude oil. Continue reading »
After coming out on top against Heritage Oil in a tax appeal tribunal at home, the Ugandan Revenue Authority claims to be winning the away leg in London as it chases the Jersey-based company for a tax bill of $435m.
Heritage disputes the claim, and says the arbitration is still at a preliminary phase. A swift conclusion seems unlikely, but the case signals a determination on the part of the Ugandan government to ensure it gets a cut of the spoils in its nascent oil industry, and underlines the risks facing investors.
Continue reading »
Californian oil major Chevron has given the go-ahead to a $5.6bn development project of an Angolan offshore oil field which will be the company’s second largest investment in African crude to date after its Agbami field in Nigeria.
The Mafumeira Sul project, run through Chevron’s subsidiary Cabinda Gulf Oil Company, is scheduled to begin production in 2015, and will eventually pump 110,000 barrels of crude oil per day from five new platforms, Chevron said. Continue reading »
The Nigerian oil industry faces a difficult 2013 as shale oil in the US takes an increasing share of the north American market. Togo-based Ecobank has said that Nigerian crude oil exports to the US could fall by over a quarter this year, from 800,000bpd in 2012 to as low as 580,000bpd in 2013.
Continue reading »
Italian oil giant Eni SpA has confirmed a discovery of around 450m barrels at its Sankofa East field 50km off the coast of Ghana, boosting the west African nation’s overall oil reserves.
About 150m barrels of Eni’s find will be immediately recoverable, according to the company, which says the result “confirms the commercial standing” of its Ghanaian prospects. Plans for exploitation of the reserves are now underway. It’s small beans (relatively) for a company of Eni’s size, but big news for the budding Ghanaian oil industry. Continue reading »
When it comes to oil and gas exploration, you win some and you lose some. All the more so when you’re blazing a trail in under-explored destinations like Uganda, Kenya and Ghana.
Shares for the oil explorer Tullow dropped sharply by over 5 per cent per cent as of 1pm in London on Friday to reach 1,159p, as the company released a statement containing details of nearly $300m of expected writedowns from explorations in Guyana, Ghana and Suriname – more than double its $120m of writedowns for 2011. Continue reading »
Mozambique’s substantial offshore gas reserves moved a step closer to full development on Friday with the announcement of a heads of agreement between the Italian energy company Eni and the Texas-based Anadarko Petroleum to jointly construct an onshore liquefied natural gas (LNG) plant at an estimated cost of more than $10bn. Continue reading »
By Yvonne Mhango of Renaissance Capital
Elections in Ghana tend to arouse less uncertainty than those in most of sub-Saharan Africa, due to its relatively stable political environment and mature democracy. This was affirmed by the smooth constitutional transfer of power following President John Atta Mills’s death in July, to his former vice-president, John Dramani Mahama.
However, a tight presidential election on December 7 – like that of 2008 – would increase the political risks. And there is a lot a stake from the ramping up of oil production to dealings with the IMF. Continue reading »
Gold diggers beware! The World Bank is setting up a trust fund to give African nations some muscle when dealing with foreign investors in the extractive industries. The $50m fund is driven by concerns that African governments are allowing the natural wealth of their country to be chipped and siphoned away, with little benefit to local people.
Recent strikes in South Africa have left foreign investors wary of putting money into African mining. Further challenges won’t be welcome. Continue reading »
When it comes to the giant gas deposits off the coast of East Africa, not everybody is on board. In Tanzania, a political row over exploration has broken out causing a licencing roadshow in three continents to be canned.
The row is between the country’s lawmakers, who are pushing for a ten-year moratorium on new offshore exploration, and the ministry of energy and minerals. But will Tanzania risk falling behind its neighbours, Kenya and Mozambique, in developing LNG? Continue reading »
South Africa on Friday lifted a 2011 ban on shale gas exploration in its semi-arid Karoo region, allowing oil majors resume the scramble for exploration licences.
The country’s estimated 485tn cubic feet of technically-recoverable shale gas resources are the fifth largest in the world, placing it just behind China, which has 1,275tn cubic feet, the US, Argentina and Mexico. Continue reading »
Three of Nigeria’s states are grappling over a newly-developed oil field that would bring the winner a much-needed boost in tax revenues.
While the dispute concerns less than 3 per cent of the country’s crude production of over 2m barrels of oil a day, establishing control could make a big difference to the cash flows of the states involved – and their political patrons. Continue reading »
Exports of west African oil are on the rise, with Asian nations increasing supplies from the region. According to a recent report by Reuters, China, India, Indonesia, Taiwan and others in the region bought an average of 1.74m barrels of oil per day from west Africa for first nine months of 2012, up about 8 per cent from the same period a year ago.
The 2012 figures represent an overall record for the region, the report states, with exports to Asia rising more than 50 per cent over the last five years to meet growing demand. The reasons for the demand, however are not entirely clear cut. Is this a response to Iranian sanctions, as suggested? Continue reading »