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Dangote, Chevron Nigeria Sign Historic Agreement on Gas Supply

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L-R: Chairman/Managing Director, Chevron Nigeria Limited (CNL), Jeffrey Ewing; Head, Gas Monitoring & Regulation Division, Department of Petroleum Resources (DPR), Sanya Bajomo; Managing Director/CEO, Gas Aggregation Company Nigeria Limited (GACN), Engr. Morgan Okwoche; and Group Executive Director, Strategy, Capital Projects & Portfolio Development, Dangote Industries Limited, Devakumar Edwin, at the signing of Gas Supply and Aggregation Agreement (GSAA) between CNL, GACN and Dangote Fertilizer Limited on Monday, February 25, 2019

The contract, under the Gas Sale and Aggregation Agreement (GSAA) is part of International Oil Company (IOC)’s gas obligation to the domestic market through the Gas Aggregation Company Limited (GACN)

LAGOS, Nigeria, March 2019/ — Dangote Fertilizer Limited has entered into a long-term agreement with Chevron Nigeria Limited (CNL) for the delivery of Natural Gas from Chevron’s supply portfolio to the fertilizer plant, which is poised to start operations soon.

The contract, under the Gas Sale and Aggregation Agreement (GSAA) is part of International Oil Company (IOC)’s gas obligation to the domestic market through the Gas Aggregation Company Limited (GACN).

The signing ceremony, held at the Department of Petroleum Resources (DPR) office in Lagos, was executed on behalf of the parties by Group Executive Director, Strategy, Capital Projects & Portfolio Development, Dangote Industries Limited, Devakumar Edwin; Chairman/Managing Director, Chevron Nigeria Limited (CNL), Jeffrey Ewing; Head, Gas Monitoring & Regulation Division, Department of Petroleum Resources (DPR), Sanya Bajomo; and Managing Director/CEO, Gas Aggregation Company Nigeria Limited (GACN), Engr. Morgan Okwoche.

Dangote Fertilizer Limited, which is ready to be commissioned before the end of this year, will produce 3.0 million metric tonnes per annum (mmtpa) of Urea.

The fertilizer plant consists of twin train, with each single train having a capacity of 1.5 million tonnes per annum of Urea and Ammonia, which makes each of them the largest train available in the world. Hence the total capacity of the plant is 3 million tonnes per annum, and it sits on an area of 500 hectares.

Speaking at the signing ceremony, Group Executive Director, Strategy, Capital Projects & Portfolio Development, DIL, Devakumar Edwin, commended the Managing Director of GACN for his role in the new business relationship between Dangote Fertilizer Limited and Chevron Nigeria Limited.

He said the company is looking forward to having a long-term relationship with Chevron Nigeria Limited as well as synergies in other upstream and wider areas of operations in the oil and gas sector.

Chairman/Managing Director, CNL, Jeffrey Ewing commended GACN, DPR for helping with the signing of the gas supply agreement. He said: “We are looking forward to working with Dangote Fertilizer and maintaining a good relationship with the company. This agreement is very important for the country and Chevron is committed to Nigeria’s economic development.”

The Managing Director/CEO, GACN, Morgan Okwoche, expressed delight to be part of the domestic gas agreement. “This is the beginning of fruitful relationship between Dangote Fertilizer Limited, Chevron Nigeria Limited and other parties. I am excited that this is happening during my term in office. You cannot imagine my satisfaction in having this contract signed at this time,” he said.

Head, Gas Monitoring & Regulation Division, DPR, Sanya Bajomo, said: “I am glad that GACN, Chevron and Dangote have signed this gas supply agreement. I want to say that this gas supply agreement is an issue of national interest and what happened today is going to be transmitted to the presidency. I believe everybody is going to benefit from this agreement when the fertilizer plant starts operation.”

– DANGOTE GROUP

Oil and Gas

Egypt records highest investment rate in petroleum sector by $30B

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CAIRO – 12 September 2019: Egypt recorded investments of $30 billion in the petroleum sector, recording the highest rates ever, according to Petroleum Minister Tarek el-Molla.

Molla clarified in a statement on Sept. 12 that the sector has achieved the largest contribution to GDP by about 25 percent, in addition to its contribution of 44 percent in foreign direct investment (FDI).

This came during his speech on the sidelines of the launch of the first strategic dialogue in the field of energy between Egypt and the United States.

Petroleum Minister Molla referred to the rate of production of natural gas and crude oil during June that hit about 1.9 million barrels of oil per day, marking the highest rate in the history of Egypt.

Molla affirmed that the huge achievements in the natural gas sector enabled Egypt to achieve self-sufficiency at the end of September 2018 and return to export. This is in addition to delivering natural gas to more than 1.2 million housing units in 2018, which is the highest rate of gas delivery to homes.

Also Read Interview: African Energy Chamber Executive Chairman, NJ Ayuk on Transforming Africa’s Energy Sector

The minister pointed out that the main objective of the program is to unleash the full potential of the sector as a sustainable development engine to enhance Egypt’s role as a pivotal center for gas and oil trade in the region.

Minister Molla added that the program is concerned with all the details and areas of work in the sector and has succeeded in improving the performance of research, exploration, production, refining and petrochemical activities through the implementation of several projects, in addition to developing the regulatory side of the sector.

Egypt Today

 

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With first oil target set for 2027, Somalia is keen to showcase its untapped potential to the world

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As part of its efforts, Somalia is expected to honour most legacy contracts

LONDON, United Kingdom, September 9, 2019 – Following the signing of a new Petroleum Law and Revenue Sharing Agreement in May of this year, as well as the unveiling of its first ever offshore licensing round (15 blocks covering 75,000 sq. km), the Horn of Africa nation is keen to show the world that it is open for business.

The law breathes new life into a dormant Somali oil and gas sector – several concessions were awarded to the majors in the late 1980s, but Civil War erupting in the country led to a force majeure declaration. Since the government collapse in 1993, insecurity and lack of infrastructure have largely rendered the region a no-go for western companies, leaving local warlords and militias to claw out territories.

Almost 30 years later, Somalia is ready to shake-off past woes and attract global participation. This effort is being spearheaded by Minister of Petroleum and Mineral Resources, Abdirashid Mohamed Ahmed, who recently commented, “this year is a landmark in the development of Somalia’s natural resources…the Ministry has worked successfully with the federal member states to create an equitable and transparent framework to develop natural resources for the greater good of Somalia”.

As part of its efforts, Somalia is expected to honour most legacy contracts. An agreement has already been reached with Shell and ExxonMobil to settle rental fee payments for offshore blocks (part of a dormant joint venture). However, it does not seem that either company is rushing back into the country, with Shell stating that “the payment does not affect force majeure status, which remains in place”.

Also Read Interview: African Energy Chamber Executive Chairman, NJ Ayuk on Transforming Africa’s Energy Sector

Despite this, Mr Ahmed has reason to hope that investment will begin to flow into Somalia. Seismic surveys conducted by British companies Soma Oil & Gas and Spectrum Geo suggest the country has promising offshore oil reserves of up to 100 billion barrels. What’s more, recent oil finds in Uganda and huge gas discoveries offshore Tanzania and Mozambique mean that oil companies have flocked to East Africa in recent years – Somalia could well become a beneficiary of this trend.

Mr Ahmed is attending Africa Oil Week 2019 in Cape Town this November. He will use this opportunity to lay out the future vision and objectives of the Somali national oil and gas sector in front of financiers and operators. The summit’s Director of Government Relations, Paul Sinclair, commented, “we are working closely with the Minister to ensure that the global private sector benefits from exclusive opportunities going live in a Somali National Showcase at Africa Oil Week”.

Africa Oil Week

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African Liquefied Natural Gas (LNG) to attract $103 Billion in 2019

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Nigeria, Egypt, South Africa, Mozambique, Senegal and Mauritania lead investment across supply and demand driven projects

MALABO, Equatorial Guinea, August 21, 2019 – Africa is an exciting frontier in the global natural gas sector. The continent holds 7.1 percent of proven global gas reserves (http://bit.ly/2KKgTgQ) and is expected to contribute nearly 10 percent of global production growth through to 2024 (http://bit.ly/30murnZ).

On the demand side, Africa’s large, urbanized and industrialized societies of the future will require reliable and sustainable power generation. With greenfield investments in Nigeria, Egypt, Mozambique and elsewhere reaching nearly $103 billion this year (http://bit.ly/30oTBSU), it is clear that liquefaction is viewed as the most profitable strategy for realizing Africa’s gas potential.

Record investments on the supply side

Nigeria accounts for over 50 percent of current LNG production capacity on the continent (https://bloom.bg/2KLS18A). With October 2019 seeing a final investment decision on the $12 billion expansion of the country’s liquefaction plant at Bonny Island in Rivers State.

The Train 7 expansion project would increase Nigerian LNG production capacity by 35 percent, from 22 million tons per annum to 30 million. Current indications point to a positive verdict (http://bit.ly/2Mu0wXT). The twenty-year-old facility is owned and operated by a consortium which includes NNPC, Shell, Total and Eni (http://bit.ly/2Z8aftm).

In North Africa, Egypt has successfully re-established itself as an important investment destination following the downturn in the gas sector in 2014. In the first half of 2019, the behemoth Zohr offshore gas field produced 11.3 billion cubic meters – 3.6 times more than it did in 1H2018. The success is set to continue with reports earlier this year of a new Eni discovery in the Nour North Sinai Concession (http://bit.ly/2NoHsd8). Evaluation is ongoing but there are hopes that the new field could rival the Zohr, which would open significant opportunities for investment in new liquification plants. In February, the Egyptian Natural Gas Holding Corporation awarded five new gas exploration concessions to Shell, ExxonMobil, Petronas, DEA and Eni in which it expects to see 20 wells drilled (https://reut.rs/2ZiMCO7).

In June, Anadarko gave its final approval for a $20 billion gas liquefaction and export terminal in Mozambique. The Area 1 project is the single largest LNG project ever approved in Africa (https://reut.rs/2zaK0Dd). And, it could be closely followed by Exxon’s $14.7 billion Area 4 development – FID is expected before the end of the year (http://bit.ly/30oTBSU). Political stability and access to east Asian markets could see Mozambique become a major global gas market over the next decade.

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Investors are also paying attention to smaller projects in countries like Mauritania, Senegal and Cameroon. Operators have been successfully able to deploy floating liquefied natural gas (FLNG) technology to realise the value of smaller assets in these markets and this could be a continuing trend in 2020 and beyond (https://bloom.bg/2KLS18A / http://bit.ly/31Qrr3E). Eni and partners are considering a $7 billion FLNG for the Coral South field in Mozambique (http://bit.ly/31Qrr3E).

South Africa’s LNG diversification play

In terms of African demand for LNG, South Africa – the most industrialized economy on the continent – could be an influential market.

Heavy coal consumption and unreliable power generation make natural gas an attractive solution to diversify its power generation base. In 2020, Transnet – a state-owned freight logistics firm – will launch a tender for the development of an LNG import terminal at Richards Bay Port. The World Bank’s International Finance Corporation has committed $2 million to fund the project planning (https://reut.rs/2ZiUtr4).

These and other recent developments reflect a growing and diverse African LNG sector. From top-tier greenfield developments to faster-to-market, agile FLNG operations; massive new discoveries to expanding existing liquefication infrastructure. It is an exciting time to be involved, as demonstrated by the high-profile speakers taking part in this year’s Gas Exporting Countries’ Forum, be hosted by Equatorial Guinea in Malabo.

Learn more and register here (http://bit.ly/2P5Gkh5) to attend the 5th GECF Summit Heads of State and Government.

Credit: Africa Oil & Power Conference

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