Photo: African Energy Chamber

Equatorial Guinea makes first step towards PSCs for new oil and gas blocks

Equatorial Guinea’s Minister of Mines and Hydrocarbons, Gabriel Mbaga Obiang Lima, has signed several memoranda of understanding (MoUs) with successful bidders of the country’s 2019 Licensing Round, on the sidelines of the Atlantic Council’s Global Energy Forum in Abu Dhabi.

African Energy Chamber

Under EG-RONDA 2019, the government of Equatorial Guinea offered 27 free blocks for exploration across its sedimentary basins. The licensing round generated interest from 53 companies and resulted in 17 bids, the African Energy Chamber, representing all facets of African oil, said in a statement on Monday.

The MoUs have been signed for Block EG-27 with Lukoil and GEPetrol (Niger Basin, offshore), EG-23 with WalterSmith, Hawtai Energy and GEPetrol (Niger Basin offshore), EG-09 with Noble Energy and GEPetrol (Duala Basin, offshore), EG-18 with Africa Oil Corporation and GEPetrol (Rio Muni basin, offshore), EG-03, EG-04, EG-19 and Block P with Vaalco Energy, Levene Energy and GEPetrol (Rio Muni Basin, onshore) and EG-28 with GEPetrol (Rio Muni Basin, offshore).

The signing of these MoUs is a first step towards the fast completion of the Production Sharing Contracts, the African Energy Chamber explained.

“The results coming out of the EG Ronda 2019 were very encouraging and we hope to see a robust and sustained exploration activity in Equatorial Guinea once these contracts are signed,” said Gabriel Mbaga Obiang Lima, Minister of Mines and Hydrocarbons.

“In 2020, the Year of Investment will see the signing and execution of several such contracts and projects, not only in upstream but also midstream and downstream,” the minister added.

According to the African Energy Chamber, exploration activity has been slowly recovering in the Gulf of Guinea. In 2019 for instance, Noble Energy announced a discovery after drilling the Aseng 6P well at a depth of 4,000 meters in Equatorial Guinea, confirming expectations that the country remains a promising frontier for oil and gas exploration. Recent discoveries are expected to add an additional 20,000 bopd to Equatorial Guinea’s oil production this year.

As previously reported by Offshore Energy Today, Equatorial Guinea’s Ministry of Mines and Hydrocarbons estimated that $1.2 billion would be invested into its hydrocarbon sector in 2020.

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