The Buzz: This Week in Africa
At the beginning of this week Brent Crude is trading at $68.56 per barrel, WTI at $63.40 per barrel and natural gas at $3.21 per million BTU (beginning of day 22 January 2018). Here are AOP’s top five stories from the last seven days.
Vitol, Nigeria’s Shoreline Reach $530m Agreement
Vitol, one of the world’s most successful independent traders, and Shoreline, a Nigerian independent, have signed a deal for Vitol to finance an oilfield in exchange for access to the oilfield’s 50,000 barrels of oil per day production, according to Reuters.
The $530 million financing deal will allow Shoreline to refinance debt and continue development on the company’s license, OML 30, which currently produces 50,000 barrels of oil per day. The deal is also expected to allow Shoreline to boost production by an additional 50,000 barrels of oil per day in the next year.
Tullow Oil Nets New Ivory Coast Blocks
Africa-focused independent Tullow Oil has been awarded two new oil and gas blocks from the Ivory Coast, bringing the company’s total blocks in the country to nine, according to E&P.
The company was awarded an onshore block, CI-520, and offshore block CI-524, which borders Tullow’s assets in Ghana.
ExxonMobil to Explore Ghana
ExxonMobil directly negotiated with the government of Ghana to be able to explore for oil and gas the offshore Deepwater Cape Three Points area, according to Nasdaq. Exxon plans to start exploration activities, including gathering seismic data, later in 2018 in a deal that is still subject to approval by the Ghana Parliament.
Exxon would hold an 80 percent stake in the block, with the Ghana National Petroleum Corporation expected to have 15 percent interest. The directly negotiated deal has come under scrutiny, however, and could face a battle for ratification from Parliament before approved, according to Citi Business News.
Off-Grid Energy Fund Gets International Support
The African Development Bank has approved $30 million to invest in off-grid energy across Africa, and international development funds have also committed to the Facility for Energy Inclusion Off-Grid Energy Access Fund, with Calvert Impact Capital committing $10 million; the Global Environment Facility $8.5 million and the Nordic Development Fund $7 million, according to Vanguard.
The Fund provide loans to off-grid energy companies, in both local and international currencies.
South Africa Replaces Eskom Board
Eskom, the public electricity utility in South Africa, will have an entirely new board heading into 2018, as the government’s attempts to re-brand the scandal-plagued utility and boost investor confidence in the energy sector.
Government spokesperson Khulu Phasiwe said the newly appointed board will provide “comfort” to the markets, according to fin24, with the new board expected to try to make peace with development institutions, such as the World Bank which is on the verge of issuing a default letter, and credit agencies, which have recently downgraded the agency’s standing.