Page 7 - LatAmOil Week 03 2021

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TNOG Oil & Gas, established by Heirs Holdings The Institute for Energy Economics and
and Transnational Corp. of Nigeria (Transcorp), Financial Analysis (IEEFA) released a report
has acquired 45% of Oil Mining Lease 17 (OML on January 14 suggesting that more than $50bn
17). Last week, the Nigerian company wrapped worth of such projects were at risk owing to soar-
up a package of deals that allowed it to buy stakes ing spot prices in recent months.
of 30%, 10% and 5% from affiliates of Royal “Asian LNG spot prices have soared to a new
Dutch Shell (UK/Netherlands), Total (France) high on the back of stronger than expected sea-
and Eni (Italy) respectively. The package also sonal demand for heating as freezing weather
calls for Schlumberger to act as TNOG Oil & grips large parts of the northern hemisphere,”
Gas’ technical partner and designates a trading IEEFA analyst Bruce Robertson said in the
arm of Shell as an off-taker of production from report. “Interruptions to supply in Malaysia,
OML 17, which is currently yielding around Australia and the US, three of the world’s larg-
27,000 barrels of oil equivalent per day (boepd). est LNG exporters, and higher freight rates have
Tony Elumelu, the chairman of Heirs Hold- also affected prices.”
ing, said last week that TNOG Oil & Gas hoped Spot prices have soared in recent months,
to use OML 17 as the basis of a larger company. with pricing agency S&P Global Platts reporting The Bangladeshi
“We have a very clear vision: creating Africa’s on January 13 that its Asian spot LNG bench-
first integrated energy multinational, a global mark had reached a record high of $32.49 government
quality business, uniquely focused on Africa and mmBtu ($898.67 per 1,000 cubic metres) the
Africa’s energy needs,” he said. previous day. has cut gas
Elumelu was speaking shortly before another Robertson argued: “Higher and volatile LNG
Shell affiliate, Shell Nigeria Gas (SNG), signed a prices will make operating LNG-powered gener- supplies to
20-year natural gas supply agreement with a sub- ation plants more costly and unpredictable. This power plants but
sidiary of Nigerian National Petroleum Corp. may lead to the underutilisation of LNG plants
(NNPC). The deal provides for SNG to deliver and rising gas and electricity tariffs for custom- has maintained
gas to industrial consumers and manufacturing ers.” He also warned that LNG prices were likely
facilities in Ogun and Lagos states, the company to trend upwards as volatility gripped the mar- industrial supply
reported earlier this week. ket, owing to “lower levels of drilling, financial
Ed Ubong, the managing director of SNG, instability in the oil and gas industry, and low
commented: “This agreement will enable local levels of industry investment”.
industries to thrive and create employment This warning came just days before Reuters
opportunities for Nigerians. We look forward reported that both Pakistan and Bangladesh
to continuing to grow domestic gas distribution had begun rationing gas supplies amid the price
to industries and manufacturing plants in Ogun spike. “The current gas crisis being faced by the
State and other parts of Nigeria while unleashing [Pakistani] industry includes disconnection of
the industrial potential of Badagry.” gas supply to industries as well as low gas pres-
sure,” Trade and Industry Association of Karachi
If you’d like to read more about the key events shaping president Saleem Uz Zaman said on January 18.
Africa’s oil and gas sector then please click here for State-owned distributor Sui Southern Gas
NewsBase’s AfrOil Monitor. Co. (SSGC) has warned industry associations
that it faces a supply deficit of around 200mn
AsianOil: Projects at risk of cancellation cubic feet (5.66mn cubic metres) per day.
Billions of dollars’ worth of gas power projects The Bangladeshi government, meanwhile,
and LNG import projects are at risk for cancel- has cut gas supplies to power plants but has
lation in Bangladesh, Pakistan and Vietnam, maintained industrial supply, said one unnamed
according to a new research note. senior official at government-run Petrobangla.

Week 03 21•January•2021 www. NEWSBASE .com P7