The Buzz: This Week in Africa
At the beginning of this week Brent Crude is trading at $55.80 per barrel, WTI at $50.59 per barrel and natural gas at $2.94 per million BTU (beginning of day 02 October 2017). Here are AOP’s top five stories from the last seven days.
Tullow Oil Moves Forward with Early Production Plan
Tullow Oil, which has yet to produce oil from the South Lokichar Basin in Kenya due to a lack of export pipelines, is moving forward with an early crude production plan that would enable the country to produce oil before pipelines are built, according to The East African.
The company has contracted Almansoori Petroleum Company, based in Dubai, to supply an Early Production Facility. The $10 million facility should arrive in the country by November. The facility would allow Tullow Oil to produce 2,000 barrels of oil per day. The basin has an upside potential of 1 billion barrels.
Mozambique Lands $150m Grant for Power Gen
The World Bank is committing $150 million in grant funding to Mozambique to improve the efficiency, operations and capacity of Electricidade de Moçambique, the electricity generation, transmission and distribution company in the country, according to ESI Africa.
The grant is specifically geared to increasing the operational capacity of EDM to increase electricity access throughout the country. Mozambique currently has an electricity access rate of about 26 percent, up from 6 percent in 2006.
Nigeria’s NPDC to Raise Crude Output
Nigerian Petroleum Development Company, a subsidiary of the Nigerian National Petroleum Corporation, plans to raise its output to 300,000 barrels per day by 2018, up from 180,000 barrels per day currently, according to Reuters.
The announcement comes as Nigeria is aggressively pursuing increased production levels, and new exploration campaigns. The company expects production to reach 500,000 barrels per day by 2020.
Vitol Nets Profit in 2017, So Far
Vitol, the world’s largest independent trader and a big player in African markets, has posted a profit for the first half of 2017, netting a profit of $818.9 million, according to Business Insider. That compares to $546.4 million from the first half of 2016. However, the results from the company’s energy trading business were on par with 2016, at $548.9 million in 2017 compared to $547 million in 2016, leading some analysts to believe traders’ runaway profits from low energy prices are coming to an end.
Global traders took advantage of contango — storing oil and weighting for rebounds in prices to sell at a higher price — and raked in record profits in recent years.
Siemens, Madagascar Work to Boost Power Generation
Siemens and the Republic of Madagascar signed a Memorandum of Understanding to boost power generation on the island nation by 300MW by 2019, according to ESI Africa. The MoU, signed last week, seeks to fast-track power generation. Efforts will include providing mobile power generation stations in an effort to connect rural populations.