02 BUSINESS DAY WEST AFRICA Outlook Nigeria: LEKOIL targets 20,000 bopd at Otakikpo oil field by 2020
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EKOIL Limited, the Africafocused oil and gas exploration and production company with interests in Nigeria and Namibia says it is focused on scaling up production volumes and productivity at its Otakikpo oil field. LEKOIL, which currently produces 8,000 barrels of oil per day at Otakikpo field, said it plans to raise production to 20,000 barrels of oil per day by 2020. According to the company’s final audited results for the year to December 31, 2017, LEKOIL achieved revenue of $30.8 million. Following this performance, LEKOIL plans an aggressive production boost and is already in the process of securing extra funding from industry sources to finance a second phase of development. Besides, the company is planning a two-well appraisal drilling programme at Ogo field, with long lead time items such as wellheads already ordered. This is as it awaits govern-
ment’s approval on its acquisition of an additional 22.86 per cent stake in OPL 310 which will take its total interest in the asset to 40 per cent. Once that is all sorted, LEKOIL expects to finalise its funding plans for the drilling programme. “Our priority for 2018 is to continue to grow production volumes and profitability at Otakikpo. Our planning for Phase 2
field development is already underway, targeting 20,000 bopd to be reached in 2020, subject to securing additional funding from industry sources” said Chief Executive Officer, Lekan Akinyanmi. Akinyanmi stated that part of the growth strategy includes further appraisal and development work at the Ogo field. “In tandem, we will aim to progress the
appraisal and development of our Ogo discovery in OPL 310. Once we receive the second Ministerial Consent, we plan to finalise funding plans for an appraisal drilling programme. The programme will comprise two wells which will include flow testing.” According to him: “Our aim is to secure enough information to enable the partners to take a Final Investment Decision in 2019 and then to proceed with development in partnership with GE Oil & Gas. LEKOIL had earlier signed a Memorandum of Understanding with GE Oil & Gas for the full field development of Ogo field.” Samuel Adegboyega, Chairman, LEKOIL added, “To our great satisfaction, 2017 saw LEKOIL’s first commercial production, and first crude oil sales. These are perhaps the most important milestones in the history of the Company and represent the fruits of efforts that have been ongoing since LEKOIL’s inception in 2010.”
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the worst market slump in a generation. With Brent crude rebounding 15 per-
cent this year as output cuts by OPEC and its allies eliminated a global glut,
Wednesday 13 June 2018
oil
Brief Algeria: Algeria sees energy law amendments in early 2019
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ong-awaited amendments to Algeria’s energy law are expected to be finalised by early next year, Energy Minister Mustapha Guitouni said. The North African OPEC member nation has been preparing changes to its hydrocarbon law in a bid to attract foreign investors that have stayed away in recent years, citing bureaucracy and tough terms. Algeria has hired consultancies, including US law firm Curtis MalletPrevost, Colt & Mosle LLP to help amend the law. “The amended hydrocarbon law will be ready by January or February 2019,” Guitouni said. The law is closely watched by foreign energy firms since the first amendment plans were announced in 2017. Guitouni has previously said amendments would include tax incentives and the alleviation of
administrative procedures to improve the attractiveness of the oil and gas sector after previous failed attempts to bring in enough foreign investors, affecting output and exports. Algeria awarded just four of 31 oil and gas field blocks on offer to foreign consortiums in 2014. In 2011, it received bids for only two fields out of 10. “The amendments will followed with projects,” Guitouni said in apparent reference to new licensing rounds. Algeria currently produces more than 1 million bpd of oil and 135 billion cubic metres of gas per year, with growing volumes going to meet domestic demand, which has hit exports.
Sudan: South Sudan and Sudan agree to repair damaged oil infrastructure
Africa: Oil rigs operating off Africa rebound to highest in two years il exploration in Africa is showing signs of recovery after the number of rigs off the continent rose to the highest in almost two years, with more scheduled in coming months. The number of active offshore rotary rigs climbed to 17 in May from a record low of nine in 2017, according to data from Baker Hughes. Africa-focused explorers such as Tullow Oil Plc cut their budgets to ride out
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there is renewed appetite for searching under-explored basins. Chariot Oil & Gas Ltd., a London-listed explorer, has contracted the Ocean Rig Poseidon to drill at least one well in Namibia by the end of the year, while Australia’s FAR Ltd. has also hired a drillship to explore a prospect off Gambia in late 2018. Total SA said in May that it expects to resume drilling South Africa’s first deepwater well by the end of this year or firstquarter 2019.
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outh Sudan said it had agreed with its northern neighbour Sudan to repair oil infrastructure facilities destroyed by conflict within three months to boost production in Africa’s youngest country. Michael Makuei Lueth, South Sudan’s information minister, said officials agreed with their visiting Sudanese counterparts to “evaluate and assess the damage” to South Sudan’s oilfields in the Heglig area in the country’s north. “There is an agreement between the two oil ministries of the two countries.
They agreed to cooperate and work together in order to repair the damage,” he said. South Sudan depends virtually entirely on oil sales for its revenue but production has declined since war broke out in the country in 2013.