Mozambique Sign Agreement With Oil Giant Exxon Mobil

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The Mozambican government has finally signed agreements with ExxonMobil and Rosneft for acreage won in the country’s fifth licensing round in 2014.

Mozambique’s National Petroleum Institute said the government was preparing to sign similar agreements with South Africa’s Sasol and Italy’s ENI.

The agreements could lead to as much as $700 million of investment in Mozambique as the energy firms are expected to drill a minimum of 10 wells, eight in deep water and two onshore, the institute added.

Aminex Get A Stake In Bounty Oil & Gas in Tanzania

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Aminex and other non-defaulting parties have acquired Bounty Oil & Gas’ shares in the Kiliwani North Development Licence and the Nyuni Area production-sharing agreement, Aminex said October 4.

The transferred interests include all rights and liabilities except that Bounty will, pursuant to the joint operating agreements, remain liable for its share of any outstanding work commitments and abandonment costs.

Subject to the completion of certain formalities, Aminex’ interests in the Kiliwani North Development Licence (which contains the Kiliwani North field and Kiliwani South prospect) and the offshore Nyuni Area PSA have therefore increased by 6.383% and 6.6667% respectively.

The non-defaulting parties’ interests in the assets are now:

Kiliwani North Development Licence

 

Nyuni Area PSA

 

Ndovu Resources (Aminex)

63.8304%

Ndovu Resources (Aminex)

100%

RAK Gas 

27.7778%

 

 

Solo Oil

8.3918%

Bounty’s website says the company’s focus has shifted slightly from high impact offshore exploration to a greater emphasis on lower risk onshore oil appraisal and development opportunities in Queensland.

Social Media And The Oil and Gas Industry

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Marketing and communications in the oil and gas industry is advancing at a fast pace. Social media is beginning to play a major role in the industry by propelling communications and marketing forward.

Despite previous roadblocks by older generations for fear of the unknown, many oil and gas companies are taking advantage of social circles and are active on several digital platforms.

An industry that rarely had a clear and strong voice in the past is now using digital channels to effectively communicate.

The companies are able to not only promote their activities, but also educate and engage with key constituents, including governments, the public, media as well as other stakeholders.

 

Read also:Community Engagement: Is Social Media Hurting or Helping the Oil and Gas Industry.

Independents in the industry, with little no marketing staff are beginning to rely on third party digital companies to help with social media campaigns.

In as much as most international oil companies have dedicated teams that are prolific on several digital platforms, they don’t cut out oilfield services or national oil companies from the social media circles. National oil companies are also beginning to realize the need to educate the word for further investment into their countries. Digital channels offers a great platform for them to connect with investors as developed countries are very active on digital channels.

Messages vary from general company activities and recruiting for jobs to earnings releases and community news. More oil and gas companies are using social media for educational purposes on a wide range of topics such as hydraulic fracturing, oilfield thread protectors and the building of keystone pipeline, just to mention a few.

There is a lot of misinformation about the industry and digital communication paves the way for companies to communicate on relevant topics and respond faster. This has become especially critical in crisis management.

Companies that are keen on staying out of political discussions are focusing on recruitment and community relations.

They are often making online posts about jobs and other activities. Majority of the firms that contribute large amounts to charity are not only posting their charitable activities on web pages but are also actively posting photos of employees at charity events.

This has enabled oil and gas companies to be more active in the community than ever before through participation in community events and special programs.

Most large companies have social media structures in place but more are starting to invest in social training for their employees.

The main idea is to rely on employees to positively promote their brands. Those more advanced in social media are even starting ambassador programs and online feeds that show the daily working life of their companies.

As the industry’s workforce is aging rapidly, social media is offering a wonderful way to attract and engage the energy workforce of the future.

Niche online communities for professionals in the oil and gas industry are growing and helping to attract the younger generations into the industry’s workforce. Associations with student chapters and on-campus industry recruitment programs are using social platforms to engage and educate students about the facets of working in the industry. It’s time for the industry to fully embrace what digital channels have to offer.

Tanzania LNG Has The Potential To Create Thousands of Jobs

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Tanzania’s planned liquefied natural gas export project is a huge boost for the economy.

The consortium of large multinational firms (Shell, UK independent Ophir , Singapore-based Pavilion Energy, Exxon Mobil, and Norway’s Equinor, formerly Statoil ) that owns part of the LNG Canada project to be built on the Lind region, Southern part of Tanzania

The project is in the planning phase, the construction will begin once the final investment decision (FID) reached.
The entire project will cost about $20 billion.

LNG has a lot of Massive Benefit To Offer
Some people say that we can fuel our economic benefits simply on industries like agriculture and tourism.

In spite the truth that such industries are key driver for our economy growth. But they are not enough to support the future of our economy.

said it before and I will say it again, depend solely on LNG to secure our economic future is wrong. But I strongly believe that LNG has a significant benefit to our economy.

Consider this estimate as an example. Build LNG plant by 2020 could create 7800 jobs over four to five year construction period. And 15,000 jobs when the LNG plant is operational,

The LNG benefits Beyond Jobs
In addition to jobs, the government will collect revenue through a tax paid by investors. According to financial times, the project will bring in $2 to $3 billion for Tanzania each year

Also, procurement of goods and services from the local suppliers will improve the locally- based economy

So what needs to happen to make the LNG reality in Tanzania?
There should be a meaningful agreement between the host country and cosntrium of multinational oil firm (Shell, UK independent Ophir, and Singapore-based Pavilion Energy, Exxon Mobil and Norway’s Equionor, formerly Statoil ) who are seeking the huge offshore natural gas reserves through LNG.

They don’t need to run a series of meetings where investors tell the host government what they are going to do in Tanzania land. But they should treat the host government as a real partner by offering real economic benefits that are win-win to both party involved.

 

If you have a questions , reach out to me via hussein.boffu@tanzaniapetroleum.com. I read all emails

Drillship to Spud Offshore Namibia Well

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The Ocean Rig Poseidon has been mobilized to drill the Prospect S Well in Petroleum Exploration License (PEL) 71 offshore Namibia, Azinam Limited and operator Chariot Oil and Gas reported Friday.

“We are delighted to announce the mobilization of the Ocean Rig Poseidon as well approach drilling on Prospect S, the first well of our multi-well, multi-year drilling program,” Daniel McKeown, managing director of Namibia-based and Seacrest Capital Group-backed Azinam said in a written statement. “Azinam is unique in this highly prospective part of the Southern African Atlantic Margin due to our license footprint, G&G database and the scale of our drilling plans.”

 

Raed:    Uganda Could Increase Refinery Stake

Azinam stated Friday morning that Ocean Rig Poseidon, a sixth-generation deep water drillship, should be onsite “in the next 24 hours” and that spudding should occur shortly thereafter. The well is designed to test multiple zones including Aptian, Albian and Ceomanian-Turonian stacked targets within an overall structural closure, the company added. Moreover, the company noted that its most recent competent persons report by Lloyds Register indicates total gross mean prospective resources of 708 million barrels.

In a separate announcement Friday, Chariot stated that Netherland Sewell Associates, Inc. has independently estimated a gross mean prospective resource of 459 million barrels and a 29-percent probability of geologic success for Prospect S.

Azinam, which is backed by Seacrest Capital Group, owns a 20-percent stake in PEL 71. Chariot holds a 65-percent interest. Other partners include NAMCOR (10 percent) and Ignitus Oil & Gas (5 percent). Azinam noted that the partners estimate drilling to take approximately 40 days.

Uganda Could Increase Refinery Stake

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Uganda’s planned refinery could cost more than originally estimated. The increase for the project isn’t in the construction cost but in the fact that Uganda could acquire more than its planned 8% stake in the project. The 60,000 bpd refinery had an initial price tag of around $2 billion.

Read  Also    Aminex’s Field Tanzania Still Spluttering

The consortium made up of Saipem, Yaatra Ventures America and Intra-continent Asset Holdings holds 60% of the planned project. Uganda, Kenya, Tanzania, Rwanda and Burundi were expected to take 8% each to complete the remaining 40%. However, Irene Muloni, Ugandan Oil Minister, said that to date only Tanzania has taken its full share of 8%. Kenya took 2.5%. Rwanda and Burundi have so far not taken their shares. As a result, Kampala plans to acquire the remaining shares.

Read.    Aminex Continue to Accelerate Its Drilling Operation on Shore in Tanzania

According to The East African, Ugandans are likely to dig deeper into their pockets to finance the construction of the refinery even though taking just the 8% would put the country heavily into debt.

Aminex’s Field Tanzania Still Spluttering

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AIM-listed minor onshore Tanzanian gas producer Aminex had only “minimal and intermittent” output from its sole producing field Kiliwani North in1H2018, it said September 28 reporting a 1H net loss.

Last year Aminex, the field operator, said that field was flowing less than 1mn ft3/d – down from 15mn ft3/d in 1H2017. It has only just well on the field: KN-1.

KN-1 has produced 6.5bn ft3 since it started up April 2016, said Aminex in its 1H results adding: “But mechanical limitations at the [third-party 140mn ft3/d]  Songo Songo Island gas process plant, in combination with reservoir compartmentalisation, have prevented expected recoveries and regular production from the well.” It had mobilised staff and equipment for “initial remedial work” on KN-1.

Read Also: Aminex Continue to Accelerate Its Drilling Operation on Shore in Tanzania

Aminex made a net loss of $2.36mn in 1H2018, more than its $2.28mn net loss in full year 2017, it said September 28. That contrasted with a 1H2017 profit of $1.56mn when KN-1 was flowing well.

In July, Aminex said it will bring in its key Omani shareholder Zubair to become operator with a 50% interest in its promising Ruvuma onshore licence just inside Tanzania though near the border with Mozambique; that includes the Ntorya gas discovery with some 1.9 trillion ft3 (53bn m3) of gas in place. On completion of that farm-out, Aminex will receive $5 cash and a net $35mn carry for its  remaining 25% stake in the development. CEO Jay Bhattacherjee said September 28 that farmout would be “an advantageous way to accelerate development and generate material cashflow from Ntorya.”

Aminex’s Kiliwani South licence could be also a potential lead, with 57bn ft3 gas in place, the company added.

Credit: Naturalgasworld

Selling to Oil Companies: What Oil and Gas Companies Buy

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Selling to the oil and gas companies can bring your firm substantial revenue and security. The sad reality is that many suppliers, contractors do not recognize wide-ranging opportunities in oil and gas companies.

They believe that because their products are not directly related to the oil and gas companies, then they have nothing to offer to the oil and gas companies. This limits the potentials of many service providers.

The good news is that oil and gas companies need various materials and services across their different operations involving discovering, developing, extracting oil and gas, and pipeline construction.

And they can buy goods and services from any part of the world if that is what will take them to get the price and quality they want.

But in recent years, oil companies prefer to work with local suppliers. According to statistics, 39 % of Tanzania suppliers are already selling to oil and gas companies operating in the country.

The use of local suppliers gives them advantages over the overseas suppliers. It helps them to cut the following additional cost:

• Foreign exchange rates.
• Extra paperwork and documentation.
• Import duties.
• Agents, brokers and middlemen expenses.
• Import and customs fees.

Whether you are veteran already supplying to the oil and gas companies or you are already serving other market but seeking to sell to oil and gas companies, here are what oil and gas companies seek.

The kinds of things that oil and gas companies seek are services and materials.

Now, let us look at each one of these in more details.

1. Services:

Here are service opportunities available in the oil and gas industry:

Advertising: Oil and gas companies are seeking to build and maintain their company reputation with the public such as suppliers, government, employees, environmentalists, communities and shareholders. If a company’s image is perceived bad, it decreases credibility, affects sales, and loses public trust in the region it operates.
Advertising also helps oil firms to position themselves as the go-to entity in the industry, and maintain and increase brand awareness. To achieve all that, oil companies buy advertising space on magazines or newspaper and website that their target audiences are. Also, they sponsor special events and rent newsletters as well.

Modification and Maintenance services: There are many oil and gas facilities in Tanzania such as gas plants and oil depots. All these facilities require regular maintenance. Also, oil companies have vehicles that need to be fixed every now and then. Maintenance is a recurring activity in the oil and gas industry. That is what major oil service firms such as Schlumberger specialize on to make a fortune.

Office space: Also, oil and gas companies rent offices. If you have an office, you can lease it to them.

Training opportunities: The good thing about the oil and gas companies is that they love to train their workforce. Training helps oil companies to increase productivity. Oil and gas companies buy safety-training manuals and also sponsors training for students and graduates.

Manpower supply: The local hire policy has been forcing oil and gas companies to hire local workforce in their operations in East Africa. With that in mind, oil companies look for suppliers who will help them get both temporary and permanent staff. For example, you can’t run any pipeline without welders. You may approach a company that was awarded to construct the East African crude oil pipeline (EACOP) to give you the right to supply welders for the entire project.

Health, safety, and environmental services: Health and safety are paramount in the oil and gas industry. Oil companies have been ordered to ensure that employees and the communities surrounding their operational region are safe. They also buy safety products such as gloves, helmets, coverall, safety shoes, and goggles.

Stress is another challenge in the workplace. Oil and gas employees work away from their family in remote and challenging areas, and due to the nature of the oil and gas jobs, they always work under pressure. Oil firms think of health assessment for their workforce.

Logistics and Transportation: Oil and gas companies need transportation services to moves their staff from the site to the campsite. Also, they have to transport their supplies from the warehouse to the operation site.

Engineering services: Oil and gas activities involve many technical and complex jobs. So, oil companies source for all kinds of engineering jobs from electrical to mechanical engineering services. For example, in any pipeline project, there is need for a Non-Destructive Testing (NDT) service. That means that after welding each joint of the pipeline, there could be a requirement for X-ray or another form of NDT to ensure the integrity of the welds.

Security services: Directors and C.E.O of oil companies recognize the importance of security and protection of employees and the equipment. For example, gas companies in Tanzania hire security to watch their natural gas well.

Construction services: Welding and fabrication of natural gas plant, oil depots, and other oil and gas facilities are in high demand from the oil and gas companies.

Consulting services: Oil companies source for a wide range of consulting services from feasibility study services to safety consultation services.

Legal services: Oil companies also need legal expertise to help them in drawing up contracts, agreements, and help them deal with local regulations and policies of the host country in which they operate.

Survey and positioning services: Geo-survey is required by the oil and gas firm especially during the exploration phase of identifying and locating places where oil and gas resources might be. Also, survey services such as geophysical survey are needed before the construction of oil or natural gas pipeline

Catering services: Oil companies feed hundreds of employees every day at the campsite and office as well.

Waste disposals services: The oil and gas industry still has critics and get more than its share in the press about its lack of security on the environment. Headlines on the newspaper and media are filled with news that emphasizes on reducing carbon emission. That makes west disposal one of the fastest growing service demanded by oil and gas companies.

Finance and Insurance services: Auditing is another service oil firms source for.

2. Materials:

Here are the types of materials oil and gas companies buy:

General materials: These supplies are necessary for normal operations. They are often called maintenance and repair operation (MRO) supplies. Oil companies have many options for these items because they are supplied by many suppliers. That means they can find the materials from different sources. Oil companies buy these items frequently but in low unit volume. Items in this category include office supplies, personal protective equipment, drilling equipment, etc.

Processing Materials: These are products needed after different processes such as refining or crushing. Many chemical products fall into this category. Example of these products includes drilling chemicals used drilling activities of the oil and gas such as Barite, Sodium, and so on. It also involves ingredients like Acetone. Also, fuel petroleum is in the categories of this group.

Oil companies buy these items from different sources of supply. And the suppliers of these items can’t differentiate themselves because these items can’t be branded.
If you offer these items, you can distinguish yourself from other oil companies’ prospects by price, ability to deliver on time, high quality, and the percentage of purity.

Production materials: These items are purchased according to the end users’ request. That means a field manager or production manager might see the need of the particular materials and send the specification to procurement manager.

These are some of the opportunities available in oil and gas companies. Never draw conclusion that oil companies do not need your services or products simply because you are unrelated to oil and gas industry.

Whatever you are selling now, your offering can fit somewhere in the oil and gas companies.

If you have any questions or suggestion do not hesitate to contact me via hussein.boffu@tanzaniapetroleum.com, I read and reply all emails.

Invitation To Express Interest From Total East Africa Midstream For EACOP project

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REQUEST FOR EXPRESSION OF INTEREST FOR PROVISION OF MAIN POWERED ENGINE DRIVEN GENERATORS PACKAGE – REFERENCE NUMBER. l 000540

TOTAL East Africa Midstream B.V. (Company), an Oil and Gas company, invites experienced and reputable Contractors to express their interest in providing Main Powered Engine Driven Generators Package for the East African Crude Oil Pipeline (EACOP) Project.

The Republic of Uganda, the Uganda National Oil Company (UNOCJ, the United Republic of Tanzania and/or Tanzania Petroleum Development Corporation (TPDC), as well as other international oil companies partaking in the development of Exploration Areas 1, l A, 2 and Kingfisher Discovery Area in the Albertine Graben in Uganda or their affiliates will participate in the implementation of the EACOP Project (Potential Pipeline Participants).

The EACOP Project development involves the engineering, construction, operation end maintenance of a crude oil export pipeline crossing Uganda and Tanzania and on onshore Morine Terminal in Chongoleani, near Tonga Port in Tanzania

Click here for more details

Does Tanzania’s Natural Gas Boom Mean Anything Internationally?

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We can talk about a thousand of things for the benefit it gives to our country. But what does it mean to Uganda, China, or wherever?

There are over 57 .25 trillion cubic feet (TCF) of recoverable gas in Tanzania and more than 441 trillion cubic feet of natural gas are still trapped underground, according to the US  geological survey.

Tanzania’s biggest energy challenge is not only self-sufficient, but the country has the opportunity to be a new source of global energy supply.

A great Supply of Natural Gas Is Needed in Tanzania and Overseas

Natural gas is a leading source of energy in Tanzania since water in dams can be scarce in the dry seasons. Natural gas is often required to generate more power.

As you can see, the oil and gas industry still has critics and still receives negative publicity about its lack of security on the environment. But natural gas burns cleaner than coal in power generation.

Read.  Aminex Continue to Accelerate Its Drilling Operation on Shore in Tanzania

In addition, natural gas continues to grow its importance as a source of energy in Tanzania because its power plants rely on it. For instance, some three years back, the 150MW Kinyerezi-1 facility came online. Also in April 3, 167MW Kinyerezi-2 facility was fully commissioned. And all these are the gas-fired power plant.

Note that the gas demand in Tanzania is huge and is supported by industrialization, economic growth, and electrification in the region.

It is not a secret that there is a huge demand for the gas within Tanzania, but there are opportunities to export to other non-gas producing countries.

China’s Thirst for Natural Gas

China’s need for an alternative source of energy is much greater. Urbanization and population growth are driving China to find an alternative source of energy.

Bloomberg New Energy Finance pointed out that China LNG’s imports climbed up by 50% in 2017and ranked China as the world’s third largest buyer after Japan and South Korea.

Furthermore, India consumes 22 million cubits of liquefied natural gas a year. The rate is expected to rise in the next 5 years.

Here’s snap shot of China’s gas needs

The chairman of Gail India Ltd. pointed out that his company wants to buy more LNG in years 2023 and 2024.

This is good news for Tanzania to further its Onshore LNG project so that they can enter long-term agreement with these Asian buyers who have need of liquefied natural gas (LNG).

As said in earlier posts, Shell (partnered by UK independent Ophir and Singapore-based Pavilion Energy) and  Norway’s Equionor, formerly Statoil (partnered with Exxon Mobil) want to develop Tanzania’s natural gas industry through building a $30 liquefied natural gas (LNG) plant. This will allow Tanzania to export its gas to the Asian market, especially China.

There are estimates that the project will increase. There are estimates that the project will bring in $2 to $3 billion for Tanzania each year.

Tanzania Pump its Natural Gas to Uganda

In August, Tanzania and Uganda signed off a natural gas pipeline trade deal. This will allow Tanzania to export its natural gas to Uganda. Last week the state-controlled Tanzania Petroleum Development Corporation (TPDC) received an expression of interest (EOI) from companies that would like to conduct a feasibility study on the pipeline.

The deal paves the way for the strong collaboration between the two countries as, recently, they agreed to build 1445 crude oil pipeline that will carry crude oil from Ugandan oil fields to Chongeleani peninsular nearby Tanga port in Tanzania.

By Hussein Boffu
hussein.boffu@tanzaniapetroleum.com