Page 5 - AfrOil Week 33

AfrOil COMMENTARY AfrOil

The country’s armed forces, known as FDS, In either case, they might have to revise their
have been trying to contain the violence and work schedule, which has already been affected
push back against militants seeking to establish by incidents such as the coronavirus (COVID-
an Islamic caliphate. They have had limited suc- 19) outbreak that hit Total’s work camp earlier
cess, not least because they lack the ammunition this year.
and other supplies needed to respond effectively. Additionally, the investors may have to
(They have also reported that the rebels are using review security arrangements in order to pro-
residents of the region as human shields.) tect the employees and prevent disruption
On August 12, FDS suffered a major setback. to the project. They have already established “
ASWJ forces succeeded in gaining control of robust security protocols for the plant, but they Mozambique
Mocimboa da Praia, a port that has been serving may want to start providing more protection for
as the main entry point for shipments of equip- employees and contractors who are away from LNG may have to
ment and goods for Mozambique LNG. The the work site. The rebels have already staged review security
port is about 75 km from the site on the Afungi attacks on Mozambique LNG’s contractors. In
peninsula where the consortium is building the the most recent incident, eight employees of arrangements
onshore plant that will process gas from Area 1. Fenix Construction Services, a local company
As of press time, neither Total nor the other that has contributed to the project, died after to protect its
IOCs involved in Mozambican gas projects had gunmen ambushed one of its vehicles near
commented publicly on the takeover of Mocim- Mocimboa da Praia. employees and
boa da Praia. As such, it was not clear whether contractors
recent events had affected the pace of work on Risk and reward
Mozambique LNG’s liquefaction plant. These considerations are not likely to derail
the project – or discourage investors in other
Challenges ahead ongoing Mozambican LNG schemes. As Ed
Nevertheless, there is likely to be more trouble Hobey-Hamsher, Verisk Maplecroft’s senior
ahead. ASWJ, which attacked and occupied Africa analyst, told Africa Oil Week in late July,
Mocimboa da Praia briefly earlier this year, is not the security risks are not high enough to out-
likely to retreat any time soon. Nor is FDS likely weigh the potential for profit.
to give up, even if it struggles to re-establish gov- Nevertheless, they could force Total and
ernment control in northern Mozambique. other IOCs to postpone work on their projects.
In the meantime, as long as the fighting Moreover, the delays might turn out to be longer
continues, Total and its partners will have diffi- than expected if conflict between ASWJ and
culty accessing the port they have been using to FDS grinds on – or if it escalates.
import the supplies they need to build its LNG And it may indeed escalate. “The complicity
plant. They may have to make new arrange- of state officials in criminal activities in Mozam-
ments for supply shipments if the militants bique increases the likelihood that the ASWJ
retain control of Mocimboa da Praia – or if port will eventually secure the weapons necessary for
facilities are damaged in fighting between the attacks on onshore LNG sites,” Hobey-Hamsher
militants and FDS. said. ™

SAMIR saga drags on in Morocco

Russian financiers discuss building a replacement for the North African country’s only refinery

DESPITE ceasing operations in August 2015, importance could have fallen quite so far from
issues relating to the liquidation of Morocco’s grace has been debated at great length, with
WHAT: sole refinery refuse to go away. A court ruling in much of the blame having been laid at the door
The mothballed facility May granted permission to the state to utilise the of Saudi-Ethiopian majority owner Mohamed
looks likely to be utilised refinery’s storage tanks in the clearest sign yet al-Amoudi’s Sweden-based Corrall Petroleum
for storage. that Société Anonyme Marocaine de l’Industrie Holdings, which reneged on a promised capital
du Raffinage’s (SAMIR) refining days are over, injection.
WHY: causing disbelief in the country, where the saga By the time SAMIR ceased operating, the
Poor management has has played out like a Shakespearean comedy. company had 867 employees and a debt burden
been cited as the reason The scrutiny over such proceedings is only of around $4.6bn, much of which was owed to
for the refinery’s failure. likely to be emphasised by news that Russia’s Moroccan customs.
state-run development bank VEB entered into a
WHAT NEXT: co-operation deal with African organisations to Derisory offers
Russia’s VEB is in talks to finance a new 100,000 barrel per day (bpd) refin- Offers were tabled by various foreign companies
construct a new refinery ery, which would effectively replace SAMIR. to acquire the assets over the past 18 months,
to replace SAMIR.
Just how a state-owned asset of such though none of these were successful.

Week 33 19•August•2020 www. NEWSBASE .com P5