Chevron Sets the Pace for U.S. Investment in sub-Saharan Gas Monetization

While American multinational Chevron has come to define the oil and gas business – officially overtaking ExxonMobil last October as the largest U.S. oil company by market cap – the current clean energy transition has driven oil and gas majors to adapt their business models to a new ethos.  

In a February interview with CNN, Mike Wirth, Chairman of the Board and CEO of Chevron, noted that while European majors undergo processes to green their portfolios via solar, wind and new renewables, Chevron will prioritize the phased development of renewable natural gas, green hydrogen and carbon capture and storage, as well as continued expansion into shale and Liquefied Natural Gas (LNG). In allocating resources to assets aligned with reduced carbon emissions, the African continent represents a valuable opportunity for U.S.  companies to grow their gas business and position natural gas as a relatively clean-burning transition fuel.  

In addition to playing a significant role in the growth of sub-Saharan Africa’s largest crude producers – Nigeria and Angola – Chevron has pioneered gas monetization in both countries and is well-positioned to advance the continent along its path toward generating regional gas exports, meeting rising power demand through gas-to-power developments and establishing industrialized economies.   

Angola 

Chevron’s operations in two exploration and production concessions in Angola – offshore Blocks 0 and 14 – have dramatically reduced the practice of gas-flaring by capturing associated gas. In Block 0, the company has continued to develop its Mafumeira Sul liquids and natural gas project, which is the $5.6-billion second-phase development of the offshore Mafumeira Field. The main production facility of the second development stage was brought online in 2017, and first liquefied petroleum gas export began in 2018, with three new wells drilled in 2019. Associated natural gas from the field is commercialized through the onshore Angola LNG plant in Soyo – in which Chevron holds a 36.4% interest – representing the first LNG plant globally to be supplied with associated gas.  

In November 2019, Chevron – along with partners Eni, BP, Total and state-owned Sonangol – formed the New Gas Consortium (NGC) for the exploration and production of natural gas in Angola. The NGC represents the first upstream natural gas partnership in the country to date, and provides for the construction of a two-billion-dollar gas-processing plant, with the capacity to generate 400 million cubic feet of natural gas per day. Upon completion, the Angola LNG plant will receive the bulk of the gas processed by the new facility – to be exported in liquid form to foreign markets – positioning Chevron at the forefront of Angola’s gas revolution.   

Nigeria 

In addition to being one of Nigeria’s largest oil producers, Chevron has led gas monetization initiatives in the country through its Escravos Gas-to-Liquids (GTL) project in the Niger Delta. The $10-billion facility converts natural gas into premium fuel, diesel and GTL naphtha products, driving both domestic and regional natural gas sales via the West African Gas Pipeline, in which Chevron holds a 36.7% interest and is the largest shareholder. With a view to monetizing 18 trillion cubic feet of gas reserves, the Escravos GTL facility and associated Escravos Gas Plant – from which it receives gas – have laid the foundation for Nigeria’s gas expansion plans and exports to neighboring markets, including Benin, Ghana and Togo.  

Operating under a joint-venture agreement with the Nigerian National Petroleum Corporation, Chevron holds interests in three operated and six non-operated blocks in Nigeria’s deep-offshore. This includes the Agbami Field – which is one of the largest deep-water discoveries in the country and is estimated to hold 400 million tons of oil in place – which the U.S. major operates through a complex of subsea wells connected to the associated floating production, storage and offloading unit.  

Entry into Equatorial Guinea, Cameroon and Gabon 

Chevron made headlines last August with its acquisition of Noble Energy, which marked the entry of the American major into Equatorial Guinea, where Noble Energy held interests in the Alba Field (33% non-operated WI and 32% revenue interest), Block O (Alen Field, 51% operated WI and 45% revenue interest) and Block I (Aseng Field, 40% operated WI and 38% revenue interest). These assets represent a combined 94 million barrels of oil equivalent of proven developed reserves and 38 million barrels of oil equivalent of proven undeveloped reserves. Under the leadership of its parent company, Noble Energy EG Ltd. achieved first gas from the Alen gas monetization project in Block O in March, which represents the first phase of Equatorial Guinea’s gas master plan to transform the country into a regional gas producer and exporter.  

In Cameroon, Chevron assumed operatorship of Block YoYo, along with deep-water Block Doujou Dak in Gabon, where Noble Energy was in the process of evaluating recently-acquired 3D seismic data. Equatorial Guinea’s Gas Mega-Hub long-term plan targets the development of the YoYo discoveries, as well as the pooling of stranded neighboring reserves, to establish several offshore gas hubs and create a broader gas mega-hub in the Gulf of Guinea.   

Energy Capital & Power (ECP) – in partnership with the Africa Energy Chamber’s U.S.-Africa Committee – invites U.S. companies, investors and organizations to participate in the first-ever U.S.-Africa Energy Forum (10 July, Washington D.C. and October 4-5, 2021, Houston, Texas), which will introduce American companies to African opportunities. To learn more about how U.S. firms can advance the agenda of sustainable, long-term investment in African energy, please visit www.energycapitalpower.com. To sponsor, speak or attend the U.S.-Africa Energy Forum, please contact Senior Direct James Chester at [email protected] 

Africa Oil & Power Transforms into Energy Capital & Power

The transition represents the company’s commitment to the future of energy investment, sustainability, inclusiveness and diversification.

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