Media
New visitor for Malabo
Upstream
Jan 13, 2006
Equatorial Guinea's government has struck a deal that will see China make its first foray into the West African country’s upstream sector.
Shortly before Christmas, a Chinese delegation arrived in Malabo, which resulted in China National Offshore Oil Corporation Ltd (CNOOC Ltd) signing a memorandum of understanding with the Ministry of Mines, Industry&Energy (MMEI) and state oil company Gepetrol covering the newly created Block S off Rio Muni.
The acreage is made up of former blocks K-14 (part), K-15 (part), L-14 and L-15, which were partly relinquished by Chevron and Amerada Hess. Seabed logging was shot over the area in 2004.
The asset surrounds Hess’ producing Ceiba oilfield and lies adjacent to and west of the US oil company’s Okume project, which is due on stream late this year. Immediately to the west is Fruitex’s deep-water Block M. Further to meetings held in Malabo between 17 and 20 December, production sharing contract negotiations between the MMIE, Gepetrol and CNOOC Ltd are due to start imminently.
In addition to the Block S deal, state-owned Chinese company Unipec has signed a memorandum of understanding with Gepetrol to produce and buy 15,000 barrels per day of Zafiro blend crude from ExxonMobil's billion-barrel field of the same name west of Bioko Island.
Meanwhile, reports from Malabo indicate state-owned gas company Sonagaz is in talks with the World Bank over funding for a project to export gas that is currently flared from Zafiro.
The scheme is expected to cost about $200 million and includes a new pipeline to link with Marathon’s onshore liquefied natural gas terminal on Bioko Island.
