East Africa has long been the next big play for oil companies. For years, it has been the domain of smaller, more intrepid players. Bigger companies, such as ExxonMobil in the Malagasy straits, have dipped their toes into the region’s waters but results have been mixed, with the oil fields on Uganda’s Lake Albert proving the brightest success story. Recently a handful of deals in the region shows that far from giving up on East Africa’s potential, companies, big and small, are hoping they will discover the next Uganda.
Petroleum Intelligence Weekly has called East Africa the “next exploration hotspot.” Here is why:
The Deepwater Horizon tragedy started out with relatively few of the sorts of dramatic images that characterised, say, the Exxon Valdez disaster.
Even as oil from the well is being captured, photos of oil-dredged birds such as this have emerged in the past few days are exposing more vividly the environmental effect of the spill:
Win McNamee/Getty Images
A Houston Chronicle journalist pondered whether the photos might have the same effect as Upton Sinclair’s ‘The Jungle’, which led to new regulations for the meat industry. It’s already a certainty that the regulatory regime around deepwater oil drilling will change. While it’s perhaps impossible to know how much further effect these sorts of images might have, they are certainly more striking than tar balls and oil booms.
More pictures here.
The popularity of fossil fuel subsidies didn’t take much of a hit despite a big run-up in prices in 2008.
Thirty-seven of the world’s biggest developing countries are spent $557bn subsidising fossil fuels that year, according to new estimates by the IEA seen by the FT.
More recent data is not yet available. But that represents quite a steep jump.
The IEA’s most recent previous estimate was for $310bn spent in 2007 by 20 non-OECD economies; this was extrapolated out to a figure of $400bn for all non-OECD countries, according to the Global Subsidies Initiative.
And, if you’re wondering how that stacked up against other types of energy subsidies, here is the GSI’s estimates:
BP’s costs from the spill so far are $1.25bn, excluding another $360m towards building Louisiana barrier islands. The problem is, as the company itself continues to point out, the total liabilities are difficult to know. A few weeks ago several equities analysts had estimated ranges of low-single digit billions to a maximum of $US12bn for BP. But bigger estimates have come out more recently as the oil slick spreads; BP’s own house broker UBS is now estimating a $40bn gross cost and others, a $20bn net cost.
And this uncertainty is affecting other companies involved in the Macondo well. The much smaller oil and gas company Anadarko is a 25 per cent owner of the well, with a non-operating interest.
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