SOMALIA: Genel Energy Suspends Somalia Operations

Security concerns in Somaliland have led Genel Energy, the exploration company run by former BP Chief Executive, Tony Hayward to withdraw its staff from the country. The devastating attack of the Somalia-based Islamist group Al-Shabaab on Nairobi's Westgate shopping centre in late September have increased security fears within the country.

A spokesman of the company told African Energy that "in the face of a deteriorating security situation, we are temporarily suspending our seismic operations".

Uganda and Tanzania to follow Kenyan Lead on Geothermal

Having learnt that geothermal power would contribute some 1,646 MW to Kenya'a proposed 5,000 MW injection of generation capacity, Uganda and Tanzania are keen to take advantage of their own Rift Valley steam potential, even though they both face challenges in terms of financing and technical capacity. 

In May 2013, US developer Ormat Technologies announced the commercial operation of Plant 2 in the Olkaria III complex in Naivasha, and the company plans to bring a third plant on line during 2014, taking Olkaria III's capacity to 100 MW. The site also has 150 MW of generation from two plants developed by Kenya Electricity Generation Company (KenGen), and the state Geothermal Development Company (GDC) estimates Olkaria's total potential capacity to be as high as 1,000 MW

KENYA: Would Kenya's Proposed 5,000 MW Keep Pace With Demand?

Kenya has announced ambitious plans to add more than 5,000 MW to their generating capacity over 40 months. If this is achieved, it would increase the country's generating output from 1,644 MW to over 6,700 MW by the end of 2016.

However, concerns have been expressed as to the prudence of adding so much capacity so quickly, and whether the current electricity demand would meet up with the supply, and the possibility of Kenya ending up with a wasteful electricity surplus. If Kenya is able to generate that amount of electricity, demand would equal supply if six new Nairobis can be created within the same period. While the possibility of this is not in doubt, the practicability is.

Could electricity export be the alternative? Creating the infrastructure to transport electricity to prospective buyer countries would be indeed be a more challenging task.

SOMALIA: ENI Seeks Somalia Entry

Paolo Scaroni, chief executive of ENI, met with the president of Somalia, Sheikh Hassan Mohamud, and during the meeting, ENI's possible entrance into the country's hydrocarbon sector was discussed.

Scaroni expressed ENI's interest in evaluating the exploration potential of hydrocarbons present in Somalia. He also highlighted the company's leadership and experience historically gained in the African continent where ENI is expanding its presence and achieving excellent exploration success.

GHANA: Ghana's Pipeline Project Suffers Further Delay

Ghana's natural gas pipeline has seen a delay in start up and is now not expected to begin flowing until April 2014. The project was supposed to begin pumping this year but was delayed until January.

Funding and other issues have kept the undersea pipeline, which runs from the offshore Jubilee field to a thermal plant near the port city of Takoradi, from keeping to schedule. The latest delay can be attributed to the cargo vessel carrying the equipment for the gas sinking at sea.

"By the end of Q1, the facility should be ready. Within Q2 we should be producing gas," Deputy Energy Minister, John Jinapor told Reuters.

LIBYA: Libya May Offer Gas Blocks in 2014

Libya has revealed that it may offer areas containing natural gas in a licensing round planned for next year. "It is possible that the bidding round could include gas," Mansour Emtir, petrochemical and gas superintendent of the state-run NOC told Bloomberg, as the country would need more gas to use as feedstock for its power plants and petrochemical projects.

Libya's gas reserves are "largely unexploited and unexlpored", NOC Gas Committee Chairman Jamal Hawisa said while speaking to attendees at the industry event. It is estimated that its already proven natural gas reserves of 54 Tcf could double with an influx of natural gas exploration. 

CONGO: ENI and SNPC to Explore Ngolo Together

ENI, the Italian oil giant and the Republic of Congo's (ROC) state-run firm Société Nationale des Pétroles du Congo (SNPC) will team up to jointly search for hydrocarbons in the Ngolo block. The block is located northeast of Brazzaville and covers an approximately 6,000 square miles in part of the little-explored Cuvette Basin.

ENI Congo will participate as operator in the Joint Venture (JV) with SNPC for the exploration of the block. The ROC's Ministry of Hyrdocarbons assigned the Ngolo exploration license to SNPC in mid-July, and exploration activities will take place over a period of 10 years.

The Italian firm said that the exploration activities on Ngolo, due to begin during the next few months will be carried out using the most sophisticated prospecting techniques including 'remote sensing' and geophysical surveys.

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Malawi: Consultants Sought for Kholombidzo

The Malawian Ministry of Energy is seeking bids from consultants interested in conducting a feasibility study for the 100MW Kholombidzo hydroelectric power plant on the Shire River. The study, financed by the African Development Bank, will look at the technical and economic feasibility of the project, social and environmental impacts, investigate options for damming or diverting water flow, and prepare preliminary engineering designs and cost estimates.

Kenya: Contractors Sought For Transmission Project

Kenya Electricity Transmission Company is inviting bids from contractors to build the 400/200kv Mariakani substation, part of the Mombasa-Nairobi transmission project. The $275.34 million project involves construction of a 450km 400kv double-circuit transmission line between Rabai, in Mombasa, where Aldwych International has built a power plant, and the Isinya substation near Nairobi. 

Finance is coming from the Agence Française de Développement (27.9%), the African Development Bank (27.2%), the European Investment Bank (27.91%) and the Kenyan Government (16.98%). Bids are due by October 11, 2013.

NetcoDietsmann Wins O & M Contract for Afam VI

Shell Petroleum Development Company has given the NetcoDietsmann joint venture an integrated operation and maintenance services contract for the Afam VI power plant in Rivers State, Nigeria, The scope of the contract provides for full operation and maintenance of the 650MW plant, including complete operation of three 160MW GT13E2 gas turbines and a 220MW Alstom steam turbine. The initial contract value is $5.4million per annum.

Mozambique-Senegal: APR Energy Signs New Deals

APR Energy has announced new contracts to provide a 40MW of power to Mozambique and 32MW to Senegal. The Mozambique award is a multi-year contract for a fast-track power plant comprising of gas power modules. The plant will run solely on natural gas and will be APR Energy's second project in the country. APR's 32MW contract diesel power modules in Senegal will supplement the 66MW the company is already providing. The new capacity will be installed at APR's Kounoune site just outside Dakar.

Algeria'sSonatrach Makes a Discovery in Libya

Algeria's state-run firm Sonatrach has made a gas discovery in Libya. According to Libya's state-run firm NOC, the discovery was made on Area 95/96 in the Ghadames Basin.

Sonatrach partnered with Oil India and India Oil Corporation made the discovery while drilling the new field wildcat well B1-95/02. The initial production test results from the Ordovican Mamouniyat Formation show the well flowed at a rate of 10Mmcf/d.

This is the second discovery announced by NOC in the past week. The previous one was made by Polish Oil and Gas Co. (POGC) Libya in the Murzuk Basin.

Mozambique Sets Capital Gains Tax Rate

Mozambique officially instituted a fixed tax rate on the sale of assets by foreign firms. An official rate of 32% will take affect starting next year. The new tax rate follows criticism on a deal in 2012 that did not benefit the country as much as it should.

Under the 2012 deal between Cove Energy and PTTEP, Cove only paid a tax rate of 12.8%. The country's parliament passed an amendment to the tax regime last year, stipulating that sales of assets held by non-resident firms would be taxed at 32% without consideration for the period they were held. But the new law was put on hold, pending a review by the president of the southeast African state.

"The constitutional issues that delayed the passing of the tax law have been overcome and the president has promulgated the law", Rosario Fernandea, head of the tax authority, told Reuters. "Come January 1, capital gains in all mega-projects, including oil and gas, will be taxed according to the new legislation".

The fixed-rate tax will affect any future gas field deals in Mozambique's attractive Rovuma basin and could spur companies with agreements in the works to push them through before the end of 2013.

Malta and Libya signs MoU

The Mediterranean island nation of Malta and North Africa's Libya have signed a Memorandum of Understanding for the supply of oil products. The announcement of the MoU came during a joint press conference between Maltese prime minister Joseph Muscat and his Libyan counterpart Ali Zidan.

Malta said in a statement "the relationship between Malta and Libya took a quantum leap today with the signing of the memorandum of understanding, which is crucial and beneficial for both countries".

Under the MoU Libya will supply Malta with an undisclosed amount of oil  products, including processed and crude oil, diesel, petrol, jet fuel, and LPG. The deal offers Malta the oil products under favorable terms and conditions.

The agreement between the two cannot be implemented immediately however as Libya's production and export levels are at an all time low due to protests in the country. The deal will push forward as soon as production returns to normal.

Guinea Government to Generate 50MW Following Power Riots

Following riots over power shortages, the government of Guinea has signed a $10 million contract with Aggreko for 50MW of short-term thermal for Conakry, the country's capital. Electricité de Guinée director-general Nava Touré said the six-month contract was the only way to calm rising social tensions in the capital. In early August, demonstrators set up roadblocks, burned tires and halted traffic to protest at the government's failure to meet its promises to improve electricity supply. Security forces intervened to restore order and at least ten people were injured.

Oryx Petroleum Hits Elephant Target in Republic of Congo

Oryx Petroleum Corporation Ltd. made a new discovery off the coast of the Republic of Congo (ROC) with the drilling of its E-1 exploration well. The well was targeting the Elephant (former Xiang) prospect in the Haute Mer A license area and discovered both oil and natural gas.

The company will test the Elephant discovery in early 2014 as part of its multi-well drilling and testing program in the Haute Mer A license area where it has a 20% participating and working interest.

Commenting, Henry Legarre, Oryx Petroleum's CEO, stated: "We are very pleased with the Elephant discovery as it represents an important milestone in the building of our West African business. Overall the results are consistent with expectations. Reservoir quality, crude quality and viscosity appear to be better than originally anticipated while the real extent of the reservoir appears to be slightly smaller than expected. We look forward to working with our partners to test and potentially appraise the Elephant discovery. Although subject to testing, the discovery gives us confidence that there is further upside potential and opportunity to expand the prospect inventory in the license area".

Tullow Farms Into Namibia Field

Tullow has struck a deal worth up to $130 million to take operatorship over Pancontinental's exploration licence off the coast of Namibia.

The deal will see Tullow take a 65% stake in the licence for the site, in the Walvis basin. Pancontinental chief executive Barry Rushworth noted that they were very pleased to have a major second partnership with an operator of such high calibre as Tullow Oil. "We identified EL0037 as one of the most prospective areas offshore Namibia and we are now extremely pleased that Tullow supports our view", he further said.

Mozambique Adds to ENI's Gas Output

Mozambique added to its natural gas totals with a new discovery on Area 4 by Italian firm ENI. The company said it has made a new gas discovery with drilling on the Agulha exploration prospect.

The Agulha was drilled in 2,492 meters of water and reached a total depth of 6,203 meters. The company's preliminary estimates show that the Agulha structure could contain 5 to 7 Tcf of gas in place, having encountered 160 meters of wet gas pay in good quality Paleocene and Cretaceous reservoirs.

Eni and its partners in Area 4 are finalizing the assessment of the discovery, and planning the appraisal strategy.

The well, which led to the discovery, is the tenth well drilled back to back in Area 4, where exploration has achieved a 100% rate of success. The discovery opens a new exploration play in the southern part of Area 4 where the drilling of three additional wells is foreseen in 2014.

ENI is the operator of Area 4 with a 50% indirect interest owned through ENI East Africa, which holds 70% of Area 4. The other partners are Galp Energia (10%). KOGAS (10%), and ENH (10% carried through the exploration phase). CNPC owns a 20% indirect participation in Area 4 through ENI in East Africa.

Crude Oil Theft: Like Nigeria, Like Europe

Like the unfortunate and persisting case  of crude oil theft in Nigeria, fuel theft, smuggling and fraud in Europe has been on the increase, where governments from Poland to the UK are losing between 100 million euros and 1.3 billion euros in tax revenue a year.

Europe's black market is adding to hard times for the refineries as the lowest demand in two decades saps refineries, according to the International Energy Agency (IEA). An average 11.6 million barrels of oil a day of crude was processed from January through May in the region's richest economies, the lowest level for any corresponding period since 1989.

Fuel fraud in countries such as Austria and Germany is dwarfed by scams taking place in Eastern Europe, according to PKN Orlen SA, Poland's largest refiner. Smuggling is most prevalent in border areas where gaps in fuel prices are the widest.

European governments are trying to respond, with Czech President signing a law that changes the country's tax code, and Ireland introducing an electronic system this year to monitor fuel movements.

Without measures to contain fuel fraud, there may be "a snowball effect, which will take years to be stopped", the Polish Organization of Oil, Industry and Trade said in an April report.

Kenya Petroleum Law Nears Completion

The government of Kenya is to see its draft petroleum laws put into action. It is expected that the first draft of the revised laws on the petroleum sector will be ready for approval by the parliament in November. The revised law comes as oil discoveries made onshore the country have been deemed commercial in quantity.

The last time Kenya updated its petroleum laws was in 1986. The revised law also contains new guidelines on natural gas exploration.

Energy and Petroleum Principal Secretary, Joseph Njoroge told reporters that the draft would take about another three months to be ready for debate in the parliament. He further said that the government was optimistic it would get financiers to help build a pipeline to transport crude oil from Uganda to Lamu, where the government is planning to build a new port.

South Africa Gives Condition for Shale Exploration

In South Africa, companies who want to explore for shale gas received little clarification from the country's water and environmental ministry on just what it will take. Water and environmental minister, Edna Molewa, said that companies looking for shale gas exploration permits must also apply for a water usage license.

South Africa has seen a substantial amount of interest in its shale resources from companies such as Falcon Oil and Gas and Shell; however, concerns over the impact of fracking have held the government in some instances from giving the firms green light.

The government, in 2012, lifted its moratorium on shale gas exploration in its Karoo Basin which sent environmentalists on the war path as they were concerned that fracking could potllute water supplies.