Page 13 - EurOil Week 40 2022

EurOil PROJECTS & COMPANIES EurOil

Shell makes foray into African power

AFRICA SHELL has made its foray into the African Shell has been acquiring renewable power
power generation sector, announcing the pur- businesses elsewhere in the world over the past
Shell is a major African chase of a Nigerian renewable energy provider year, including India’s Sprng Energy in April for
oil investor but this is its on September 28. $1.55bn and US-based Savion in December last
first investment in the Anglo-Dutch major is acquiring Daystar year. The Daystar purchase appears to be much
continent’s power. Power, which works in Nigeria, Ghana and three smaller in scale, however. The company has an
other countries in West Africa, providing solar installed generation capacity of only 32 MW, ver-
power and battery solutions to businesses and sus 2 GW run by Sprng in India.
industry. Its customers include Nigerian Bot- Daystar has raised some $92mn in funding
tling Co., which manufactures Coca-Cola in the since its formation five years ago, including a
country. $20mn facility that was provided by Washing-
Shell is one of the largest oil producers ton-based International Finance Corp. (IFC)
in Africa, but despite pledging to halve its last year.
greenhouse gas (GHG) emissions by the end Though its first acquisition in renewables in
of the decade, it is yet to invest in any renew- Africa, Shell has a long history in Nigeria, hav-
ables, or any other power generation, on the ing first discovered oil in the country in 1956.
continent. But in recent years it has been beset by environ-
“As we do this, we’re helping to address a crit- mental issues and oil theft at its oil projects in
ical energy gap for many who currently rely on the country.
diesel generators for backup power,” Shell’s vice Last year, Shell announced it would be divest-
president for renewable generation, Thomas ing its troubled onshore operations in Nigeria
Brostrom, said in a statement. He said the move while retaining its offshore assets. But the sales
was a “fundamental step for Shell in growing our process has been complicated in court cases
presence in emerging power markets.” revolving around the company’s responsibility
The transaction sum was not disclosed. for past environmental damage. ™

Hurricane gives up another UK licence

UK HURRICANE Energy has abandoned plans to any contingent resources.
develop a West of Shetland oil prospect previ- Decisions to withdraw from the Halifax and
Hurricane has suffered ously thought to be 1.2bn barrels in size. the Greater Warwick Area follow a “rigorous
significant difficulties at The company decided in September to for- screening criteria,” Hurricane said.
several projects. mally relinquish the P2308 licence contain- In April, Hurricane and Spirit said that fol-
ing Halifax owing to the “low likelihood of a lowing appraisal and development work, it was
successful economic development,” it said in a determined that the Greater Warwick Area was
statement. It follows Hurricane’s decision with “not feasible”, resulting in the latter booking a
partner Spirit Energy to give up their licence for $4.1mn impairment cost. The pair teamed up at
the Greater Warwick Area as well. the area in 2018, with Hurricane farming out a
There is “no reasonable expectation that” the 50% stake to Spirit.
company could generate “any near-term cash Hurricane has also suffered disappointments
realisation,” Hurricane said. The company is at its Lancaster oilfield, also west of the Shetland
therefore voluntarily ceding the licence to allow Islands. The company filed a decommission-
it to focus its time and financial resources instead ing plan for the field in April, just three years
on alternative and more attractive opportunities. after launching production at the problematic
Hurricane noted that all previous capi- project.
tal investments relating to Halifax had been Lancaster only began producing oil in May
impaired already, and therefore no further 2019. The complex, fractured basement reser-
impairments would be announced. voir underwent a major reserves downgrade
Hurricane suffered a major setback last year in September 2020, with Hurricane cutting the
when a reserves report significantly downgraded amount of oil targeted in its first development
its reserves, triggering a slump in its share price. phase to just 16mn barrels. Originally it was
Halifax was once thought to hold 1.2bn barrels expected to retrieve 37.3mn barrels over an ini-
of oil, but on Hurricane’s books it no longer has tial six-year period. ™

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