On the back of a major gas monetization drive, the Republic of the Congo is expected to produce 3 million tons per annum (mtpa) of gas by 2025 while dynamic opportunities in gas processing and refining present lucrative investment opportunities for international players. In May 2024, the Republic of the Congo’s Minister of Hydrocarbons Bruno Jean-Richard Itoua confirmed the formation of a gas master plan and comprehensive gas code, with the country poised to establish a national gas company by Q3 2024.
Ongoing offshore exploration and development programs are set to transform the Republic of the Congo’s energy sector through responsible gas development, laying the foundation for long-term and sustainable economic growth.
Marine XII: Taking Congolese Gas Global
The Republic of the Congo exported its inaugural shipment of LNG to Italy in February 2024. The cargo was exported from the Tango FLNG facility – operated by Eni. The Tango project leverages gas resources and existing production infrastructure at the Marine XII concession, situated roughly 3km offshore the Republic of the Congo. With the arrival of a second LNG vessel in 2024 – which boasts a capacity of 3.5 billion cubic meters – the country’s production will be driven even further as it expands its exports from Europe to wider international markets and regional buyers.
With its first LNG delivery, the Republic of the Congo takes a historic step in the development of its burgeoning hydrocarbons sector. The delivery also stands to bolster local electricity supply while providing essential, clean energy to neighboring countries. According to Minister Itoua, the project also has the added benefit of raising the nation’s oil output to 500,000 bpd of oil equivalent in two years, further bolstering the economy.
Natural Gas is Attracting International Interest
Despite being largely underexplored, the Republic of the Congo is a mature hydrocarbon market with proven natural gas reserves measuring an estimated 10 trillion cubic feet. Coupled with the country’s 3 mtpa output targets, opportunities for the development of gas processing and export infrastructure present service providers the chance to establish a foothold in the Republic of the Congo’s natural gas sector.
International operators are ramping up their exploration and production activities through 2024 and beyond. This year, Eni completed the sale of some of its upstream assets in the Republic of the Congo to independent explorer Perenco. Meanwhile, in September 2023, the Republic of the Congo’s parastatal SNPC alongside Eni and independent producer Lukoil signed a contract for the purchase and sale of LNG from the Marine XII project. According to the country’s hydrocarbons ministry, income from the deal will be used to support electricity deployment, as well as mining, agriculture and industrial activities across the country – all of which are major economic drivers.
Meanwhile, over a period of 25 years, Wing Wah’s Banga Kayo permit plans for a cumulative production estimated at nearly 30 billion cubic meters of associated gas. This project is poised to monetize untapped gas resources in the country while reducing carbon emissions from gas flaring. The project will be carried out in four phases, each progressively increasing the gas treatment and valorization capacity to meet local and regional LNG and LPG demand. The first phase is set to begin in August 2024.
Located near the city of Pointe-Noire, the Congolaise de Raffinage is the country’s sole refinery, with the facility boasting a refining capacity of approximately 600,000 tons per year. The inauguration of the Pointe Noire II refinery – expected to start operations this year – is poised to drive production to 2.5 million tons of the relatively clean-burning fossil fuel, which will be used to meet the Republic of the Congo’s domestic demand of 1.2 million tons. Further investment in downstream gas infrastructure stands to bolster domestic power generation, enabling the country to meet not only local demand for sustainably-produced energy but regional.
Establishing Natural Gas as a Transition Fuel
Currently in its final stages, the Republic of the Congo’s Ministry of Hydrocarbons has confirmed the formation of a new gas master plan. Under the plan, the country will consolidate the position of existing exploration and production companies in the sector, as well as promote foreign direct investment and Congolese and African participation in marginal fields.
With support from a number of IOCs participating in the country, the plan showcases the Republic of the Congo’s strategy towards using natural gas a transition fuel to more sustainable resources. The plan is designed to promote gas utilization and will serve as a roadmap to harnessing the country’s gas resources both for domestic consumption and export.
Meanwhile, as part of the country’s new gas code, the government is poised to make changes to current fiscal terms in the country to make small-scale projects more economically viable. The Ministry of Hydrocarbons aims to have the new code approved by Parliament by June this year, according to Minister Itoua. It’s safe to say that the Republic of the Congo is closing in on its target of becoming a major, global LNG player.
Energy Capital & Power Senior Director James Chester will travel to Pointe Noire and Brazzaville from June 16-20 to discuss regional collaboration opportunities. Contact james@energycapitalpower.com to arrange a meeting.
