The Invest in Equatorial Guinea Country Spotlight Session at African Energy Week 2022 showcased the Central African producer’s achievements in gas monetization and energy sector diversification.
With Equatorial Guinea setting its sights on revitalizing its oil and gas sector, strategicinvestments, opportunities in oil exploration, gas monetization, refining, mineral extraction and more were put on display at the Invest in Equatorial Guinea Country Spotlight session on Wednesday at African Energy Week 2022 in Cape Town.
The day-two session was opened by a keynote from Equatorial Guinea’s Minister of Mines and Hydrocarbons, H.E. Gabriel Mbaga Obiang Lima, who has played a pivotal role in facilitating an influx of foreign capital into Equatorial Guinea and enabling operators to carry out capital-intensive E&P activities in 2022 and beyond. The Minister highlighted the country’s recent sector achievements – namely, producing first gas from the Alen Gas Monetization Project in February 2021 –along with plans to boost oil output by attracting new players to its exploration scene and extending the lifespan of maturing fields.
“Gas has been one of the best gambles that we have ever done in our industry. Going forward, our focus is on investment in gas utilization and infrastructure and fast-tracking natural gas projects. In the short term, we believe this is the best investment we can make,” began H.E. Minister Mbaga Obiang Lima. “We are also not going to forget oil. Clearly, our production has been rapidly declining. This has to do with investment. If you don’t invest in the field – in drilling new wells, in maintaining existing infrastructure – you won’t have new oil. It is critical for us to be able to bring in independents and keep chasing those resources.”
Following the Minister’s keynote address, a panel was held and moderated by Elizabeth Rogo, CEO of TSAVO Oilfield Services and President of East Africa of the African Energy Chamber. Panelists included Pablo Memba, CEO of GML; Oscar Garcia Berniko, Director of Equatorial Guinea’s Ministry of Mines and Hydrocarbons; Tim O’Hanlon, Senior Advisor to the Board, Panoro Energy; Curtis Ryland, Managing Director of EG LNG; Burma Nzang Ondo Asangono, Director General of Planning, Ministry of Finance of Equatorial Guinea; Olakunle Williams, CEO of Tetracore Energy; Steve Brann, Senior Investment Manager, Vitol; Tope Shonubi, Co-Founder and Executive Director, Sahara Group; Nzan Ogbe, CEO of Levene Energy; Scott Childres, Director, Mid-Africa, Chevron; and Karl Staubo, CEO of Golar LNG.
As the African natural gas value chain becomes the preferred destination for foreign direct investment, Equatorial Guinea has emerged as a leader in regional gas monetization and utilization. Its flagship Gas Mega Hub project – whose first phase saw successful completion by Chevron during the COVID-19 pandemic and ahead of schedule – seeks to boost intra-African trade of LNG by pooling stranded gas and utilizing existing gas processing infrastructure, presenting a range of investment opportunities from power generation to liquid fuels.
“The Alen unitization is the first time that we have gas from another field, other than the Alba field, to bring to Punta Europa, using the same infrastructure that was done in one field and being able to process and sell it,” continued H.E. Minister Mbaga Obiang Lima. “With the Alen gas monetization project, we have proven the Gas Mega Hub. It is a simple concept about capturing gas within the region. If you bring your gas to Punta Europa, then you will be able to process it without having to invest in an LNG plant.”
“The position that Equatorial Guinea has in leveraging infrastructure has to attract other investment – not just within the borders, but within the region,” said Curtis Ryland, Managing Director of EG LNG. “When you look at gas monetization, EG LNG is part of the process and technology. Gas needs to be monetized to get to market.”
“Regarding infrastructure, Punta Europa is one of the best performing gas infrastructures – not only in CEMAC, but in West Africa,” said Oscar Garcia Berniko, Director of the Ministry of Mines and Hydrocarbons of Equatorial Guinea. “It is pushing us to believe that we can not only process gas from other fields in Equatorial Guinea, but also from neighboring countries like Cameroon and Nigeria.”
CEMAC Cooperation
In addition to its large-scale gas developments, Equatorial Guinea has risen to the forefront of energy diplomacy discussions within the Economic and Monetary Community of Central African (CEMAC) region. In the past year, Equatorial Guinea has signed cooperation agreements with Cameroon, Nigeria, São Tomé and Príncipe and the Republic of the Congo, among others, in the fields of hydrocarbon exploration, energy cooperation, cross-border security and regional gas trade. At a time when the global oil and gas industry faces collective uncertainty and heightened geopolitical tensions, regional integration has been prioritized as a critical means of fostering economic recovery and enabling energy developments.
“The opportunities for expanding and leveraging existing infrastructure to provide further development is a key strength to Equatorial Guinea and the region,” said Scott Childres, Director, Mid-Africa, Chevron. “As Chevron, we’re very interested in being a part of that.”
“One of the things that Equatorial Guinea has done very well is to look at soft infrastructure,” noted Steve Brann, Senior Investment Manager, Vitol. “They continue to teach people through partnerships and JVs. Our own agreement with the Government and GEPetrol is one of the most innovative in the industry, and the concept of being a trader in the world markets – rather than just selling FOB from the country – is something on which other, much larger countries are 5-10 years behind.”
“From the private sector perspective, LNG infrastructure is good for business in our region because we can sell our gas, our LNG and our products to neighboring countries,” added Pablo Memba, CEO of GML. “Not just selling gas directly, but building a power plant and wiring the electricity to neighboring countries.”
As one of the leading hydrocarbon producers in Central Africa and on the continent, Equatorial Guinea serves as an example of an African producer who was able to largely maintain its oil production in the face of COVID-19, while driving forward new, diversified developments in refining, gas monetization and mineral exploration. In addition to the two planned modular refineries in Punta Europa on Bioko Island and Kogo on the mainland, the Ministry of Mines and Hydrocarbons is spearheading the construction of a urea plant, ammonia plant and methanol-to-gasoline conversion unit, with a view to stimulating other, non-energy industries such as agriculture, transportation and logistics.
“Small countries are more outward-looking,” commented Tim O’Hanlon, Senior Advisor to the Board for Panoro Energy. “Equatorial Guinea’s first discovery was natural gas. They turned first gas into methanol, and then became one of the biggest exporters of methanol in Africa.”
“Equatorial Guinea has never failed in the delivery of their cargoes – it is like the Singapore of West Africa,” said Tope Shonubi, Co-Founder and Executive Director, Sahara Group. “I work in 24 African countries, and Equatorial Guinea is a hidden gem.”
