Page 6 - AfrOil Week 21 2021

AfrOil COMMENTARY AfrOil

condensate discoveries will need to find viable heading for the exit in Congo (Brazzaville),
monetisation solutions to encourage further Jersing believes “the challenge will be finding
interest in the basin. buyers.”
Exploration success in the second half of the This changing of the guard will require
year is likely to be determined by the results of “smaller, less strategically constrained and more
a few key high impact offshore wells that are agile operators [like Assala Energy, Trident
expected to spud, including Total’s Ondjaba in Energy and others] who can compress timelines
Angola, and Venus in Namibia; Petronas’ Jove and lower breakevens through agile and lean
Marine in Gabon and Azinam’s Gazania in South operating models,” he added.
Africa. Jersing notes that newer players such as Car-
Jersing notes: “Should Venus be a material lyle-backed Boru Energy and more recently
liquids success outcome, there will likely be a Afentra with its ex-Tullow leadership are focused
Namibian frenzy by incumbent players in the on West African ‘flowing barrels’ assets, with the
Orange river basin to unlock dependent upside latter saying last week that it intends to pick up
and running room.” “material production [of] multiple tens of thou-
sands” of barrels per day.
Changing of the guard Despite the challenging outlook, Jersing
Meanwhile, as some majors reduce their expo- remains confident about the future of African
sure, Wood Mackenzie estimates that more than E&P, concluding: “Capital is amoral and will
40% of BP, Chevron and Equinor’s remaining always continue to chase the best margins; as
capex focuses on mature, non-core fields, and resource holders become more fiscally welcom-
will be largely spent on decommissioning. ing to life-cycle investment win-wins, the tide
At the other end of the scale, France’s Total will turn.”
“with major stakes in East Africa will seek to Speaking to AfrOil on condition of anonym-
continue to press ahead with geopolitical over- ity, several fund managers said that while the
sight and host government engagement, to keep need for investment in low-carbon and renew-
momentum going”, according to Jersing. able energy is warranted, the about-face from
In addition to its major upstream projects in oil and gas risks “throwing the baby out with the
Kenya, Uganda and LNG Mozambique – cur- bathwater” and public funds will likely lose sig-
rently under force majeure – through two off- nificant ground to private equity.
shore high-impact wells – Ondjaba and Venus Meanwhile, as governments compete for
– due to spud this year, Total remains “the investors and majors continue to shed assets,
key material frontier explorer along with Eni, there are likely to be numerous opportunities
CNOOC and, [to a lesser extent] [Royal Dutch] for those with cash on the hip or PE backing to
Shell on the continent”. pick up bargains.™
Meanwhile, as BP appears likely to sell its
Algerian assets, Oxy continuing to sell out Ian Simm is principal advisor at consultancy
of Ghana, ExxonMobil looking to exit Chad, IGM Energy and collaborates with companies
Block B in Equatorial Guinea, some of its Nige- throughout the energy value chain on asset mar-
rian assets and Block 2 in Tanzania, and Eni keting, due diligence and strategy.

P6 www. NEWSBASE .com Week 21 27•May•2021