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NIGERIA
Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), Alhaji Mele Kyari, disclosed that the Corporation has begun discussions with partners for the construction of the Nigeria Liquified Natural Gas (NLNG) Train 8. In December 2019, company shareholders had signed the Final Investment Decision for Train 7 to expand the complex to 30 metric tons per annum (mtpa) from the current 22 mtpa.
Kyari emphasized that the NNPC is making every effort to establish gas hubs that will lead to the creation of LNG projects, as the current focus of the Federal Government, the NNPC and partners is on gas monetization. LNG facilities will lead to more jobs and employment, as well as expand the domestic economy.
Kyari also noted that Nigeria is considering new oil field licensing rounds for 2021. Africa’s largest oil exporter had previously delayed major oil field bid rounds this year due to COVID-19. Kyari said that the current price rebound should enable “some kind of licensing” next year, which could include ultra-deepwater fields.
Nigeria launched its first marginal oilfield licensing round in nearly two decades in July 2020. These fields are likely to be developed by local companies and are less reliant on limited international funding. While some fields have been awarded, the Federal Government has yet to announce the full list of winners.
Minister of State for Petroleum Resources H.E. Timipre Sylva said that Nigeria’s long-awaited Petroleum Industry Bill (PIB) would include low tax provisions to sustain stable investments in the country’s oil sector. The Minister delivered this remark at the seventh joint International Energy Forum and International Gas Union ministerial gas forum held online.
Minister Sylva also stated that a framework must be created for the Nigerian petroleum industry to grow and invest in additional petroleum products production – even under difficult economic conditions – and that the proposed PIB will be centered on core principles of clarity, dynamism, neutrality, open access and fiscal rules of general application.
He also added that key priority projects that Nigeria had planned to execute in 2020 have not been forgotten. The country has repeatedly failed to pass the PIB, a bill expected to help reform the oil sector when passed into law. The PIB is considered relevant to the country’s quest to regain its competiveness as a global energy player. A new version has been submitted again to the National Assembly for legislative consideration.
GHANA
The Ghanaian Government has awarded a seismic data supplier contract to TG-GEOPARTNERS for 3D surveys over 14,000 km2 to carry out a major multi-client 3D geophysical study in the Keta basin, Volta region. The works aim to provide an enhanced geological understanding of the region ahead of next calls for exploration license tenders. The contract will commence in early 2021 for a period of 10 months, with the results available by the second quarter of 2022.
New advanced acquisition and imaging techniques will improve understanding of the complex structures of the area, which has the potential to become Ghana’s next exploration hub. The Keta basin, which occupies one third of the country, has already attracted several international oil companies, such as Swiss African Oil and Ophir Energy.
GABON
VAALCO Energy announced the completion of the acquisition of 3D seismic data at the Etame Marin block offshore Gabon. Highlights include completing the acquisition of nearly 1,000 km2 of new dual-azimuth proprietary 3-D seismic data over the entire Etame Marin block, which will be used to optimize and de-risk future drilling locations and potentially identify new drilling locations; enhancing sub-surface imaging by merging legacy data with newly acquired seismic allowing for the first continuous 3-D seismic over the entire block; the processing of the seismic data expected to begin in January 2021, with all data expected to be fully processed and analyzed by Q4 2021; and planning for the commencement of the next drilling campaign at Etame in late 2021 or early 2022.
GLOBAL
On December 10, crude oil prices were up with the U.K.’s rollout of a COVID-19 vaccine and the imminent arrival of the same vaccine in the U.S., spurring hopes of a recovery in fuel demand and eclipsing a larger-than-expected build in U.S. crude stocks during the previous week.
The U.S. West Texas Intermediate crude futures settled up $1.26 at $46.78 per barrel, while Brent crude futures settled up $1.39 at $50.25 per barrel. The U.S. Energy Information Administration’s (EIA) weekly report for December 9 showed a 15.189-million-barrel build for the week ending December 4, much bigger than the 1.424-million-barrel draw in forecasts and the previous week’s 679,000-barrel draw.
The EIA data follows the American Petroleum Institute report on December 8, showing a 1.141-million-barrel build in U.S. crude oil supplies, also bigger than the forecast 1.514-million-barrel draw, but down from the previous week’s 4.146-million-barrel build.
Oil is on the mend from historic lows reached in April when the pandemic hammered demand, helped by a record supply-cut deal by the Organization of the Petroleum Exporting Countries and allies (OPEC+). The Organization will further ease its supply restrictions in January 2021 by adding an extra 500,000 barrels per day to provide additional support to the market. Also boosting oil prices was investor concern over an attack on an Iraqi oilfield. Two wells at a small field were set ablaze by explosives though the incident did not affect production.
