Time to diversify: Equatorial Guinea’s ambitions

The ratification of eight new production-sharing contracts in 2013 gave a much-needed boost to exploration activity in the country. It also proved that Equatorial Guinea’s offshore is still an attractive area for international oil companies to invest in.

The 2014 licensing round, announced at the World Petroleum Congress in Moscow, is consistent with the ministry’s efforts to attract further foreign investment in Equatorial Guinea’s offshore regions.

The licensing round commenced on July 1, 2014, and closed on September 30. All the available open acreage in the Equatorial Guinean offshore is on offer. The area is being divided into 14 separate blocks, which cover offshore Bioko Island and Río Muni, with an additional four blocks available offshore Annobón.

 How does the Bioko oil storage terminal fit into Equatorial Guinea’s plan to become a regional energy centre?

The Bioko oil terminal is part of the country’s growth agenda. The aim is to take advantage of our strategic geographic location, and favourable business climate and the ability to access global physical flows of oil linking West and Central Africa with the rest of the world. Our intention is to build a terminal, which will be one of a kind in the region in terms of materiality and operational flexibility.

Our vision is to create a regional storage centre for both refined products and crude, operated by an international and reputable terminal operator. We will provide the logistics infrastructure to support safe and reliable operations and eliminate current inefficiencies in the value chain.

We will also tap into international trading flows and, in tandem, serve the local and regional supply agendas. During construction and operation, the project will provide a platform for job creation, technological know-how and a continuous cycle of training for our people. We expect that the operations around the terminal will create an inflow of supporting services in oil and shipping, strengthening Equatorial Guinea’s reputation as an international player.

In addition, we anticipate that the project will be commissioned around three years after the beginning of construction. We expect construction to start in 2015 and the terminal to begin operations by the end of 2018.

What does the development of an ambitious project, like the floating LNG platform in block R, suggest about the country’s energy industry?

The installation of a floating LNG vessel in block R will be the first of its kind in offshore West Africa. The new floating LNG platform signals to the international oil and gas industry that Equatorial Guinea is a country where the MMIE will actively work with the operators to assist in the development of hydrocarbons. The experience gained through the successful development of the block R gas resources could also be applied to the development of any other deepwater gas resources that may be discovered in the future.

The platform also has the potential to be used as a base for regional natural gas distribution. Being a regional leader and collaborator is a core part of our strategy. 

What progress has been made on the Petrochemical Revolution of Equatorial Guinea (REPEGE) plan?

A gas supply agreement has been signed with block I and O partners Noble Energy, Glencore and Atlas Petroleum for the planned petrochemicals complex at Riaba, located in the west of Bioko Island. The feasibility study to define the plant’s capacity was completed in August 2014. The land has been identified and the site’s groundwork was initiated by a partnership between WorleyParsons and DeltaTek.

We have designated a strong team from the MMIE to immediately initiate negotiations with our partner international fertiliser company Archean on gas pricing for REPEGE projects and we are moving forwards with other legal agreements.

What impact did Equatorial Guinea’s appointment as head of the African Petroleum Producers’ Association in 2013/2014 have on the industry?

Equatorial Guinea in its year of chairmanship improved co-operation, knowledge of member countries’ energy situation and policies to meet national energy needs. It championed several local content initiatives that ensured the increase of local content participation.

What is the MMIE’s development of the local electrical infrastructure?

This ministry has in place an action plan that prioritises the cleaner energy aspects of Equatorial Guinea’s national electrification plan. This includes concrete goals, measures and timeframes to increase the country’s electricity generation from hydropower and, potentially, solar and wind power. We have made it a top priority to reduce the use of fossil fuel-generated electricity. By doing so, we have become compliant with international best practices.

With such actions, we will meet our mission to ensure electricity for all citizens, and also provide enough power for industrial development.

How is the MMIE working to secure growth in the industrial sector?

The MMIE is working to secure and attract new growth in the industrial sector via a three-pronged approach.

The first is the retention and expansion of existing industry through diversification, alliances and other sustainability plans. We will attract new industries to serve current and future public-private needs. We will create demand for the new products or services via job creation, sourcing raw materials locally and fostering a supportive local service sector that is able to meet the country’s needs.