Total Acquires Major Oil and Gas Assets Across East Africa

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French oil supermajor Total SA (NYSE:TOT) has acquired oil and gas installations in east Africa for an undisclosed amount, covering assets in Kenya, Uganda and Tanzania.

The major acquisitions reportedly are in line with Total’s diversification policy, which focuses on building up logistics at a time when cost-profit equations have rendered extraction less attractive.

The deal to acquire assets belonging to Gulf Africa Petroleum (GAPCO) includes two logistical terminals, one in Mombasa, Kenya, and the other in Dar es Salaam, Tanzania. The deal also gives total a network of 100 gas stations in the region.

The deal still has to be approved by the authorities of Kenya, Tanzania and Uganda.

“This acquisition is in line with Total’s growth strategy for the distribution of petroleum products and services in Africa, which aims at expanding in fast-growing regions while maintaining high profitability,” Momar Nguer, president of Total Marketing & Services, was quoted as saying.

A company spokesperson also noted: “The acquisition of these assets, which are complementary to Total’s existing operations in Kenya, Uganda and Tanzania, will strengthen Total’s logistics in the region and significantly accelerate the growth of our service station network, particularly in Tanzania, while leveraging the Total brand.”

Gapco is a holding company incorporated in Mauritius with operating subsidiaries in Kenya, Uganda and Tanzania. Reliance Industries Ltd (RIL) has sold its 76% stake in GAPCO to Total. According to Reliance, GAPCO now operates 108 retail outlets and owns 260,000 kilo liters of storage capacity.

Total SA’s stock dropped 0.79% or $0.39 on 31 May, reaching $48.9 per share. The company’s shares are down 3.475 since October last year.

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Kijana Yunus Mtopa Ajinyakulia Kitita Cha Dola Elfu 5 Za Statoil Tanznia

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Mshindi wa Shindano la Mashujaa wa Kesho lilihusisha vijana wenye umri kati ya miaka 18 na 25 kutoka mikoa ya Mtwara na Lindi, Yunus Omary Mtopa, akionekana ni mwenye furaha sana baada ya kujinyakulia kitita cha dola elfu 5, kwa kuonekana wazo lake la Biashara ya Miwa kuwa bora zaidi ya wenzake. Hafla ya shindano hilo ilifanyika mwishoni mwa wiki iliyopita, katika Hoteli ya Hyatt Regency, Jijini Dar es salaam.
 
Mwaka huu shindano hili lilivutia vijana zaidi ya 400 ambao waliwasilisha mawazo ya biashara zao zinazolenga sekta mbalimbali za uchumi kama kilimo, ufugaji, mawasiliano, na biashara nyingine ndogondogo. Vijana waliruhusiwa kushiriki mmoja mmoja au hata kuunda vikundi vya watu wawili mpaka watatu.
Jaji Mkuu katika Shindano la Mashujaa wa Kesho lilihusisha vijana wenye umri kati ya miaka 18 na 25 kutoka mikoa ya Mtwara na Lindi, Dkt. Neema Muro, akitoa maelezo mafupi ya washiriki wa shindano hilo kabla ya kumtangaza mshindi.
Sehemu ya Wageni mbali mbali waliohudhulia hafla hiyo, wakiwa makini kumsikiliza jina la Mshindi wa Shindano la Mashujaa wa Kesho lilihusisha vijana wenye umri kati ya miaka 18 na 25 kutoka mikoa ya Mtwara na Lindi, katika hafla iliyofanyika mwishoni mwa wiki iliyopita, katika Hoteli ya Hyatt Regency, Jijini Dar es salaam.
Mgeni rasmi katika Hafla ya kumtangaza Mshindi wa Shindano la Mashujaa wa Kesho lilihusisha vijana wenye umri kati ya miaka 18 na 25 kutoka mikoa ya Mtwara na Lindi, Katibu Mtendaji wa Baraza la Taifa la Uwezeshaji Wananchi Kiuchumi (NEEC), Bengi Issa, akikabidhi mfano wa hundi kwa Mshindi wa Shindano hilo, Yunus Omary Mtopa.
Mgeni rasmi katika Hafla ya kumtangaza Mshindi wa Shindano la Mashujaa wa Kesho lilihusisha vijana wenye umri kati ya miaka 18 na 25 kutoka mikoa ya Mtwara na Lindi, Katibu Mtendaji wa Baraza la Taifa la Uwezeshaji Wananchi Kiuchumi (NEEC), Bengi Issa (wa nne kulia), Balozi wa Norway nchini Tanzania, Hanna-Marie Kaarstad (wa pili kushoto), Meneja Mkazi wa Kampuni ya Statoil Tanzania, Øystein Michelsen (shoto) wakiwa katika picha na washiriki wa shindano hilo.
Soma:      Statoil Yataja Vijana 5 Walioingia Fainali za Shindano La Mashujaa Wa Kesho
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Solo Oil signs SPA for Kiliwani North, Tanzania

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Solo Oil has concluded a deal with Aminex plc to acquire a further 3.825 percent interest in Tanzania’s Kiliwani North Development License for a total cash consideration of $2.16 million. As part of the agreement, Solo’s interest will increase through three payment tranches to Aminex, linked to project milestones, for the total agreed cash consideration.

An initial investment of $566,802 for an additional one percent interest was made upon the signature of the Sale and Purchase Agreement, increasing Solo’s total interest from 6.175 percent to 7.175 percent.

A second investment of $708,502 for a further 1.25 percent interest will be made within 15 days of the first US dollar payment being received for gas from Kiliwani North-1. Solo’s total interest will increase to 8.425 following this transaction and a third payment of $892,712 will be made for the final 1.575 percent interest within 15 days of the commercial operations date being declared, taking Solo’s total and final interest to 10 percent.

If any payment is missed then that payment option, and only that option, will be automatically cancelled. Payment of the second and third investments will require further funding from cash flow or otherwise to be arranged by Solo. The KN-1 well, which is ready to begin production, has been ascribed gross contingent resources (2C) of gross 28 billion cubic feet by LR Senergy and Solo expects to book reserves from the well by year-end.

Solo Oil Chairman Neil Ritson commented in a company statement: “Solo is delighted to increase its exposure to the KNDL project with commencement of production imminent. The project offers a revenue stream that will increase through the commissioning process and into commercial production under the GSA which has take-or-pay provisions and is paid in US dollars guaranteed by a consortium of banks. By linking the acquisition of our additional interest to project milestones we have been able to further de-risk the investment.” –

Aminex plc and Solo Oil plc ready to start Tanzania gas production

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Aminex and Solo are now ready for production to start, following the completion of final testing at Kiliwani North – now they wait for the Songo Songo processing facilities to be commissioned.

Aminex plc (LON:AEX) and Solo Oil plc (LON:SOLO) have told investors that first gas production from the Kiliwani North  gas project, in Tanzania, is now expected in early April.

Final well integrity testing has now been completed for the Kiliwani North-1 (KN-1) production well.

The state’s Tanzania Petroleum Development Corporation (TPDC) had previously advised Aminex to prepare the KN-1 well for production by mid-February.

The change to the anticipated timetable is the result of a revision to the commissioning schedule for the Songo Songo gas processing facilities, which will be supplied by the field.

Initial production will be managed to enable testing of the new gas processing facilities and the related pipelines, the companies added.

Gas produced from the Kiliwani North-1 well is to be sold at the wellhead at an agreed price of $3.07 per thousand cubic foot (which equates to $3 per British thermal unit). The gas, once processed at Songo Songo, will be transported via pipeline to Tanzania’s capital Dar es Salaam where it will be sold in the domestic market.

The Kiliwani North field is estimated to contain 28bn cubic feet of contingent gas resources. Solo said it expects these resources will be booked to reserves later this year.

“The successful conclusion of the well integrity tests and installation of the wellhead control panel finalises the Company’s preparations prior to the commissioning of the new Songo Songo Island processing facilities,” said Jay Bhattacherjee, Aminex chief executive.

“Aminex looks forward to the commencement of gas production and revenues from Kiliwani North.”

Neil Ritson, Solo Oil chairman, added: “Following the signing of the gas sales agreement and the completion of the construction of pipeline and gas treatment infrastructure Solo looks forward to the commencement of commissioning at Songo Songo.”

Aminex owns a 51.75% stake in Kiliwani North, while Solo owns 6.175%. The other partners in the project are RAK Gas, Bounty Oil & Gas and TPDC (TPDC).

Tanzania Agrees With Uganda to Run Oil Pipeline to Its Coast

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Tanzania and Uganda’s leaders agreed to build a crude pipeline linking their countries, connecting landlocked oilfields to the Indian Ocean, Tanzanian President John Magufuli said.

Statements issued after Ugandan President Yoweri Museveni and his Tanzanian counterpart John Magufuli met on Tuesday did not mention the fate of the Kenyan oil export pipeline plan.

Uganda, which has yet to start oil production, raised the possibility of a Tanzanian pipeline route last year.

France’s Total, one of the oil firms developing Uganda’s fields, had raised security concerns about the Kenyan route. A Kenyan pipeline could run near Somalia, from where militants have launched attacks on Kenya.

But industry officials have also said connecting Kenyan fields, which are also yet to start production, with those in Uganda would make the pipeline project cheaper as costs would be shared.

“The two countries are planning to build an oil pipeline between Tanga (in Tanzania) and Uganda covering a distance of 1,120 km,” the Ugandan presidency said in its statement. “Magufuli said this is projected to employ 15,000 people.”

Also Read:Tanzania Make New Natural Gas Discovery In Ruvu Basin

Tanzania, which also has large offshore natural gas reserves, issued a similar statement.

Uganda’s Museveni has strong ties with Tanzania as he launched the rebellion that brought him to power in 1986 from Tanzanian soil.

Uganda’s statement quoted Magufuli saying that Uganda’s decision was “reciprocating” Tanzania’s past role.

Museveni and Kenyan President Uhuru Kenyatta had made a joint call in August to implement a pipeline via Kenya’s northern region “without further delay”.

But that statement was followed by other Ugandan comments saying the Tanzanian route was being explored as a possibility.

Resolving the pipeline route is vital in helping oil firms involved in Uganda and Kenya make a final investment decision on developing oil fields.

Production start dates have repeatedly been postponed, partly over pipeline considerations but also because of low oil prices.

Other investors in Uganda include China’s CNOOC and Britain’s Tullow Oil. Tullow is also is working in Kenya.

reuters

Tanzania Make New Natural Gas Discovery In Ruvu Basin

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Feb 25 Tanzania has discovered an additional 2.17 trillion cubic feet (tcf) of possible natural gas deposits, raising the east African nation’s total estimated recoverable natural gas reserves to more than 57 tcf.

The onshore reserves were found at a field licensed to the United Arab Emirates’ Dodsal Group located at Ruvu basin in Coast region, near the country’s commercial capital..

“We have learnt that there are huge potentials of hydrocarbons in Tanzania. We expect to have more gas discoveries in the near future,”  CEO of Dodsal Hydrocarbons and Power (Tanzania) Ltd, as saying.

East Africa is a new hotspot in hydrocarbon exploration after substantial deposits of oil were found in Uganda and major gas reserves discovered in Tanzania and Mozambique.

Dodsal Chief Executive Officer (CEO) Mr P.K Surendran made the announcement during a meeting bringing together investors in the gas and oil industry, which was convened by the Minister for Energy and Minerals, Professor Sospeter Muhongo.

Prof Muhongo confirmed the discovery, which he said was made in July last year, but was quick to add that the government delayed to make the announcement due to new requirements of the Petroleum Act 2015.

“The new legislation requires that before the responsible minister makes the pronouncement of a new finding he/she should be guided by the Petroleum Upstream Regulatory Authority (PURA).

“My ministry has been in contact with the Attorney General’s Chambers since then and the good thing is that PURA started operations yesterday (Tuesday).

We, therefore, hope that the official announcement will be made in a few days to come,” Prof Muhongo explained. The Petroleum Act 2015 repealed The Petroleum (Exploration and Productions) Act, 1980 and The Petroleum Act, 2008.

Apart from the new finding, gas reserves have as well been discovered in Songo Songo Island in Lindi Region, Mnazi Bay in Mtwara and Mkuranga in Coast Region.

Mr Surendran said the company signed a Petroleum Sharing Agreement (PSA) with the Tanzania Petroleum Development Corporation (TPDC) in 2007 after which it started a seismic study of the licensed block. Dodsal Hydrocarbons and Power Tanzania Limited is a subsidiary of Dodsal Resources based in Dubai.

So far, the firm has drilled three wells at Mbuyu, Mtini and Mambokofi in the exploration area in Coast Region. “Exploration is still ongoing and we are optimistic of striking more natural gas reserves in the Ruvu Block.

We used local talents and resources in the search and the success is beyond our expectations,” he later told ‘Daily News’ on the sidelines of the meeting.

He was more positive of reliable market for the hydrocarbons given the fact that Ruvu is just 17 kilometres away from Dar es Salaam city, which is the major market of the resource for electricity generation, industrial production and domestic use.

The Chairman of Dodsal Group, Dr Rajen Kilachand, said the company is currently planning appraisal and development activities to bring the gas to the market for the benefit of the people.

“At this moment of success, I wish to sincerely thank the Ministry of Energy and Minerals and TPDC as well as other stakeholders for the cooperation and support rendered to us,” Dr Kilachand said in a statement read by the CEO.

Earlier, Prof Muhongo directed companies engaged in the oil and gas industry to present to the ministry with practical work plans on how they will play a part in boosting power generation to meet the target of 10,000MW by 2025.

READ: Tanzania-to-rake-in-capital-gains-from-55b-buyout-of-bg-group-by-rival-shell

“The gas economy should make us graduate to middle-income economy by 2025 as stipulated in Tanzania Development Vision 2025. This will be possible when we have adequate and reliable electricity in the economy,” the minister stressed.

He thus urged the companies to present the plans to the ministry by June 1 this year, noting that the aim is to enhance power per capital to between 2,000 and 3,000 per annum from the current 180 units.

Prof Muhongo noted on the other hand discussions with a consortium planning to set up the 60 billion US dollars were well underway

Most of the gas discoveries in Tanzania were made in deep-sea offshore blocks south of the country near the site of a planned liquefied natural gas (LNG) plant.

BG Group, acquired by Royal Dutch Shell, along with Statoil, Exxon Mobil and Ophir Energy plan to build the onshore LNG export terminal in the southern Tanzanian town of Lindi in partnership with state-run Tanzania Petroleum Development Corp (TPDC).

Tanzania to rake in capital gains from $55b buyout of BG Group by rival Shell

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Tanzania is set to collect millions of dollars in capital gains tax following Shell’s acquisition of BG Group, barely two years after banking $258 million in similar payments over the same gas resources.

On Monday, Shell officially acquired BG Group and its assets in a $55 billion deal, touted as the biggest energy deal in more than a decade — positioning Tanzania as one of the continents’ top supplier of gas.

Tanzania is expected to endorse the transaction and change of shareholding once the capital gains tax payment has been effected.

The takeover now gives Shell a 16 per cent controlling stake in the world’s liquefied natural gas (LNG) business, with Tanzania and Egypt as its anchor operation areas on the African continent. Tanzania has proven reserves of 55 trillion cubic feet of natural gas, which is expected to generate almost $5 billion annually.

The country is expected to construct an LNG plant at the start of next year, with a target completion date of 2024, depending on Shell’s strategies.

 

BG Group Tanzania, with its partner Ophir Energy, has invested over $1 billion in a fast-track exploration appraisal programme. BG owned 16 wells for blocks 1, 2 and 3, which contain an estimated one-third of Tanzania’s gas reserves.

BG Group declined to discuss the transaction details and the amount payable to Tanzania.

Three years ago, Tanzania received a capital gains tax of $258 million on the proposed $1.3 billion asset sale of Ophir Energy’s natural gas fields in the country to a unit of Singapore’s Temasek Holdings.

Kenya Eyes Oil Export In 2017 via Truck and Railway

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Kenya is considering moving its crude oil to Mombasa by road and railway as President Uhuru Kenyatta’s administration races to hit export markets before the General Election set for August next year.

The Energy ministry has offered Rift Valley Railways (RVR) the contract to move the oil over a distance of more than 800km, from Eldoret to the Kipevu-based Kenya Petroleum Refineries  (KPR) from as early as February next year.

By choosing trucks and train, Mr Kenyatta’s administration appears determined to sidestep bureaucracy involved in constructing a joint pipeline with Uganda in an effort to beat its tight timelines.

“We are quite ambitious but we know we will be able to pull this off in the next 12-16-month window,” said the head of Presidential Delivery Unit Nzioka Waita.

“And as we speak, work has been done to improve the road network from Lokichar to Lodwar and from Lodwar to Kapenguria to increase the shoulder size to allow trucks which carry crude oil to convey it to Kitale and subsequently to Eldoret,” Mr Nzioka said in a presentation made during the Governors’ Summit last week.

The upgrade of the 213km- road from Lokichar to Kitale has been top of the government’s agenda as it looks to facilitate the quick transport of crude to an export terminal in Mombasa.

Kenyan officials also appear to be keen on sidestepping the long process of constructing a joint crude oil refinery under discussion with Rwanda, South Sudan and Uganda.

The joint projects were supposed to be built in public-private partnership model.

South Sudan is embroiled in civil strife since 2013 while Uganda has in recent months been preoccupied with political campaigns that culminated into Thursday’s election.

Uganda, which aims to start crude production by 2018, recently signed an agreement with Tanzania to explore the possibility of building a crude oil pipeline between the two countries.

Although Uganda had agreed to the Kenyan route, it said Nairobi had to guarantee security for the pipeline, along with financing and cheaper fees than alternatives.

Settling for a route through Tanzania could slow some projects in Kenya, which are planned to run alongside the pipeline on the land corridor in the North of the country to Lamu, where Kenya wants to build a new port to serve the region.

“We are now trying to refurbish Kipevu plant– which has only been bringing petroleum in – to take petroleum out,” said Mr Nzioka.

“At the Kipevu plant, they’ll do what they call first line refinery and then take that into the export market.”

TPDC Fertilizer Plant To Provide 5000 Direct Jobs And Opportunities For Construction and Building Players

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The Tanzania Petroleum Development Corporation has announced that it will invest in a fertilizer plant to be set Kilwa division Lindi district German investors Ferostaal Industrial Project GmbH at a cost of $1.9 billion.

TPDC says it is the government’s plan to support companies investments in the extractive sector with the plant expected to produce 3850 tonnes of fertilizer daily.

According to TPDC Director for Production, Processing, Transport and delivery of natural gas  Dr. Wellington Hudson who met representatives from Kilwa, Lindi  the joint venture will utilize 104 million cubic feet daily and will produce two types of fertilizer namely ammonia and urea.

Also Read:.The Ultimate Guide To Invest In Tanzania’s oil and Gas Sector

TPDC through its managing director Dr. James Mataragio adds that the plant will provide 5000 direct jobs as well as opportunities for players in the building and construction industries who will provide the needed raw materials.

The project is also expected to increase earnings for the corporation through consumption of natural gas while at the same time provide opportunities to better sectors such as health, aviation, sea ports among others.

They were both speaking at a familiarization and community awareness tour in Kilwa that saw representatives including the area members of parliament, district commissioners and heads of various committees including security attend with the aim of ironing issues related to the project.

Since the discovery of natural gas in Tanzania the economy has witnessed tremendous growth with 70% of power generation coming from gas which is currently serving 37 industries in Dar es Sallam according to TPDC.

Tanzania And Mozambique Eye Gas Exports Despite Oil Price Slump

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Rivalry between Tanzania and Mozambique has sparked renewed activity in the Liquified Natural Gas (LNG) segment despite the slump in energy projects in other parts of the world.

The phenomenal drop in global oil prices has no doubt brought massive headwind for much of the energy value chain, especially exploration and production companies.

Exploration and development of reserves has fallen sharply in most parts of the world as investors stayed cautious—stirred by the fact that oil prices have fallen almost 75 percent since mid-2014 as producers pump up to two million barrels of crude every day and far in excess of demand.

Also Read:Tullow-oil-gives-kenyas-oil-and-gas-industry-150-million-development-boost

In East Africa however a budding rivalry between Tanzania and Mozambique, that have both discovered major gas reserves, has sparked renewed activity in the Liquified Natural Gas (LNG) segment despite the slump in energy projects in other parts of the world.

The two countries are in a vicious race to become Africa’s newest LNG exporter and snap up contracts before supplies from rival producers in other parts of the world come to market. Both nations have a targeted of exporting gas by early 2020s.

Tanzania’s land deal

In a move that signaled a push to expedite LNG development and exports, Tanzania on January 29 announced it had finalised a land acquisition for the site of a planned LNG plant and was now working to compensate and resettle villagers.

Oil firms have for a long time been unable to gain access to the site, dealing a blow to the country’s dream of pumping gas to the market.

“After securing the title deed, the law requires the owner to pay compensation to the relevant parties based on a valuation done by the chief government valuer,” the state-run Tanzania Petroleum Development Corporation (TPDC) said in a statement.

About 55 trillion cubic feet (tcf) of natural gas has so far been discovered in Tanzania in recent years and more is expected as exploration activities continue.

Following the deal by Tanzania, TPDC now owns title deed for some 2,071.705 hectares of land that have been set aside for the construction of the planned two-train LNG terminal at Likong’o village in the southern Tanzanian town of Lindi, which is located close to large offshore gas finds.

TPDC plans to build the onshore LNG export terminal in partnership with BG Group, Statoil, Exxonmobil and Ophir Energy.

Speeding up

The action by Tanzania came in the wake of resolutions by Mozambique and contracted firms, Anadarko and Eni, to get the natural gas projects online within the shortest time possible.

“What is critical is that we need to speed up the pace to the market because the window of opportunity might shrink,” Omar Mitha, chairman of the State owned ENH, that has a stake of at least 10 per cent in all Mozambique’s gas projects, told the Financial Times in November.

“The reason behind that is because the dynamics of the marketplace are changing” he added.

US energy company Anadarko separately said it was pushing ahead with its planned $20 billion Mozambique gas export project and will make a final investment decision once the government approves its development plan.

“”We’re working full out to achieve a final investment decision as soon as possible,” Anadarko’s country manager John Peffer told Reuters in Maputo, without committing to a timeline.

Anadarko aims to have its first LNG cargo leave Mozambique by the end of the decade, delayed from an original plan of 2018.

In the five years to 2015, Anadarko Petroleum of the US and Italy’s Eni have made gas discoveries in the Rovuma Basin in the Indian Ocean that are estimated collectively to exceed 160 tn cu ft.

Support

Both Tanzania and Mozambique are keen on tapping wealth from LNG resources to support their economies soonest possible amid tightening economic conditions.

Only recently the International Monetary Fund (IMF) approved Mozambique’s request for a $282.9 million to augment reserves and maintain macroeconomic. The loan SCF aims to alleviate the external balance of payments shocks, and through strengthening macroeconomic stability, to achieve the government’s goals on poverty reduction and inclusive.

“Despite lower commodity prices and a weaker global environment, Mozambique’s economic prospects remain positive given planned massive investment in natural resources,” the IMF said.

Tanzania is also banking on its gas reserves to help build its forex reserves through exports. East Africa’s second largest economy also hopes to save about $1billion a year in oil imports for electricity generation when it shifts to gas-fired power plants.

Tanzania in October 2015 launched a $1.33 billion project that aims to construct a 532 km natural gas pipeline to its capital Dar es Salaam from Mtwara where its gas fields are located. The project will also entail construction of gas processing plants.

Tanzania has indicated it will give priority to domestic use of its natural gas resources over exports under energy policy that will guide the exploitation of its vast reserves.