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Total is one of Gabon’s existing core players.
Gabon
and neighbouring Congo (Brazzaville) to four billion barrels of crude and raise gas reserves very considerably, at least according to Eni’s calculations. Shell and CNOOC in October last year reported hitting a 200 feet gas pay zone in pre-salt formations in Gabon’s Block BCD10. Earlier in 2014 Eni reported a 500mn barrel find, the Nyonie Deep, in Block DV. Further south in the same geological basin, off Congo, Eni in October last year hit a 1,380 foot light crude pay zone. Deepwater acreage off Gabon found many takers in the country’s 2013 licensing round and currently ExxonMobil, Repsol, Ophir Energy, Petrobras and Marathon are among the companies pursuing an exploration programme at some stage in Gabonese waters. With sub-salt potential being so large, compared to the country’s current production, economy and population, it is not surprising that tough reforms get stranded and abandoned. These could reinvigorate the mature assets more efficiently but have faced some resistance from within as well as outside the country. Gabon’s application to sign up to the Extractive Industries Transparency Initiative (EITI) some years ago is a case in point. A lack of follow-through on transparency and statistics reform resulted in the application being rejected in 2012. That does not make Gabon stand out particularly from a crowd of crude exporting nations – but for a
country seeking investments to achieve a turnaround in its fortunes, that could actually be the problem. A bolder path in this regard would have put it on a better footing to lure new players and to diversify its own options in the oil and gas sector. As things currently stand, Gabon has all its eggs in the sub-salt basket, at a time of deep capex slashing in the oil industry and when West African crude increasingly has to find new markets in faraway Asia and often is being marketed at a marginal disadvantage. Indications of commerciality for the sub-salt discoveries, which to date have been made in the region, are good although these are very early days, but, given the oil price movements of just the recent month,
developments might be further away than Gabon’s government had hoped. In the meantime, this situation leaves the leadership with few options. The economy could take a further dive, with strikes and riots further destabilising the industry and cutting into export revenue. The government would have even less opportunities to sweeten terms and attract investment, particularly for marginal projects which could have been fast-tracked and yielded shortterm benefit, in such a scenario. Things are looking up for Gabon’s oil industry, but it might find itself being very much at the mercy of global oil price movements in the coming years, before any largescale sub-salt FIDs are signed. ■
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Oil Review Africa Issue Four 2015 19