Page 13 - AfrOil Week 17 2020

AfrOil
NEWS IN BRIEF
AfrOil
POLICY
Equatorial Guinea to offer extensions to exploration companies and flexibility to producing companies
During a webinar hosted by Africa Oil & Power in partnership with the African Energy Chamber and the Ministry of Mines and Hydrocarbons of Equatorial Guinea, Mbaga Obiang Lima, the country’s Minister of Mines and Hydrocarbons (MMH) provided key insight on the country’s plans in working through the current state of global oil markets and the COVID-19 pandemic.
Considering 2020 and 2021 as “lost years” amid the low oil price and COVID-19, Obiang Lima stressed the importance of flexibility and taking a realistic approach in order for oil pro- ducers all over the world and, especially in Africa to recover from the downturn – a message well in line with the African Energy Chamber’s Com- monsense Agenda for the Oil & Gas Industry, released today.
Maintaining his optimism, the minister said to the attendees of the webinar: “I believe this pandemic presents new opportunities for the African continent. It is a new opportunity because some of the historical services operators are leaving countries with the resources and they are having to realise that they have to do the work themselves.”
He added: “This is a chance for African entre- preneurs to enter the market and operate their installations themselves rather than waiting for the pandemic to end. It is a great opportunity but, with this great opportunity, we still need to
be realistic.”
In taking a realistic approach, Obiang Lima
said with the second half of the year rapidly approaching, small African oil-producing coun- tries needed to focus on research and develop- ment, give license extensions and look at 2021 as the year of rethinking. In doing this, the min- ister provided that Equatorial Guinea would see new legislation announcements, which would include the limitations of expatriates which will be for three years and encouraging the national service industry to take responsibility and pre- pare for the rebound.
“The other regulation that we are planning to launch this week is mineral and petroleum reg- ulation,” the minister announced. The launch of this regulation will allow the MMH to develop on its mining industry and see that there is a good deal of local participation in the sector.
Next month, the MMH will also release a new petroleum regulation that will focus on its down- stream sector. “This is really what we believe will be the future for our oil and gas industry. The refining and downstream is key because it can create a lot of jobs and it is about time that we processed our resources in-country,” said the minister.
On how local content policy will change under new legislation for IOCs and NOCs , he said there will be contracts and projects that will have to be 100% Equatoguinean. This will be implemented in the upstream, downstream and petrochemicals sector.
Moving ahead, the MMH will push three key messages to national oil companies (NOCs) and international oil companies (IOCs): the need to maintain shareholder value which will benefit the people of Equatorial Guinea and ensure that revenue generation is maintained; ensuring the safety of operations for the workers who have
continued amid the COVID-19 pandemic; the importance of maintaining and supporting the relationships between NOCs and IOCs, certify- ing that both sides work through the challenges together.
With 2020 having been declared as Equa- torial Guinea’s Year of Investment (YoI), the MMH head maintains that the initiative is still important for the country’s development and it will continue and lead into 2021 focusing on its petrochemical advancement.
“By the fourth quarter of this year, I should be able to announce the different projects that we will be doing. For example, the [gas] back- filling: We will have the first production of [gas] backfilling in November, and we expect to have the ground-breaking on some of our refinery projects,” he revealed.
African Energy Chamber, April 27 2020
FINANCIAL
ADM Energy issues
update on loan
facilities agreement
ADM Energy, an oil and gas investment com- pany quoted on AIM, provides a corporate update in light of the COVID-19 pandemic and unprecedented market conditions affecting the oil industry.
Key points:·successfully executed Loan Facilities Agreement (GBP200,000), Directors’ Subscriptions (approximately GBP50,000) and Debt Conversion (GBP152,400); operations at OML 113 largely uninterrupted, with produc- tion levels remaining stable; COVID-19 protec- tion measures implemented to reduce cost base, secured finance for working capital purposes, and agreed a two month extension with EER for the refundable deposit payment; board, opera- tors and joint venture partners focused on seek- ing ways to mitigate the impact of the oil price reduction; ADM well positioned to withstand current market volatility and pursue the Board’s stated core investment strategy
Osamede Okhomina, CEO of ADM Energy, said: “Whilst COVID-19 and the depressed oil price present a challenging environment, the Board and I are pleased to report that OML 113 has maintained its operational levels. Neverthe- less, to strengthen the financial positon of the Company, we have taken the prudent decision to reduce our cost base, secure finance for work- ing capital purposes, and have also agreed a two- month extension with EER for the refundable deposit payment as part of our increased invest- ment in OML 113, announced in February this year.
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