Mozambican parliament approves new Hydrocarbon Law

Mozambique’s long awaited petroleum law has been approved by the parliament with substantial amendments by MPs who argued that the changes will strengthen the role of the Mozambican state in oil and gas exploration and production.

The bill, which will come into effect by the end of the year, was approved with votes from Frelimo and MDM. Renamo voted against the bill on the grounds the High Authority of the Extractive Industry – the body that oversees oil and gas operations - must be composed by elected members from all political parties.

The most important point in the new law is perhaps the fact that the state, through the National Hydrocarbon Company (ENH), controls the production, transport, marketing and transformation of all LNG and their derivatives.

It also states that the government must create the conditions for the involvement of Mozambican business people in the oil and gas industry. This is in response to local businesses who have been demanding a better share in the oil and gas business.

The sector is currently dominated by giant multinationals such as Anadarko and ENI and their own international service suppliers. It is very unlikely that any local company will venture into bidding for concessions of oil and gas exploration areas because they neither have the necessary expertise, nor the funds. They have, however, asked the government to introduce a special regiment that forces multinationals to contract local companies for service and products supply.

For a comprehensive analysis of Mozambique’s petroleum law, the Renamo amnesty deal - otherwise unavailable in the international press - and the political, business and security issues affecting Mozambique, please see our latest issue of Mozambique Politics and Security.

© 2014 Menas Associates

Algeria: Sonatrach may take stake in Mozambique gas assets

 

Sonatrach's CEO Abdelhamid Zerguine was quoted by APS on 30 April as saying that Sonatrach is in talks to farm into Mozambique's offshore gas projects operated by Eni and Anadarko.

Anadarko, which has been in Algeria since the 1980s, is the largest foreign operator there, operating three oil and gas production sites, with production approaching some 350,000 b/d. It has recently been responsible for discovering one of the world's largest gas finds in Mozambique's Offshore Area 1 of the Rovuma basin. The discovery is likely to transform the economic prospects of Mozambique and Southern Africa.

Zerguine was speaking after signing a Memorandum of Understanding with the head of Mozambique's Empresa Nacional de Hidrocarbonets (ENH), Nelson Ocuane. He said Sonatrach was interested in buying part of a minority stake held by ENH in the offshore gas fields. “We want to have a place, but on the Mozambican side,” he said.

Zerguine did not give details of the size of stake Sonatrach was seeking to acquire, but said a 5% holding would cost it around US$1 billion. The memorandum also opened the way for Sonatrach to acquire exploration blocks in Mozambique.

For more news and expert analysis about Algeria, please see Algeria Focus and Algeria Politics & Security.

© 2013 Menas Associates

Algeria: El Merk 'mega project'

Following the announcement of the settlement of its tax dispute Anadarko issued a statement, ahead of its investor conference last week, saying that the El Merk mega project, in which Anadarko is the leading foreign shareholder, is approximately 90 per cent complete and expected production of significant volumes by the end of this year. The El Merk in the Berkine Basin is approximately 300 kms south-east of Hassi Messaoud. It was established to design and construct the surface facilities required for the exploitation of hydrocarbon liquid reserves of six reservoirs in Blocks 208, 405a and 212. It will also accommodate the processing of additional fluids from the Sonatrach/Anadarko and Sonatrach/Eni existing HBNS/HBN facilities (Block 403a/404a), approximately 80 Km north of the proposed El Merk development.

The US$4 billion El Merk Oil Field Development project is under the management of the Groupement Berkine whose shareholders are Sonatrach (37.70%), Anadarko (18.10 %), ConocoPhillips (16.90%), Maersk (9.10%), Eni (9.10%) and Talisman (9.10%) A considerable number of other foreign companies are involved in various aspects of the massive project. These include Petrofac for the central processing facilities; the ABB/SARPI/Petrojet consortium for the support networks; Kahrif for the transmission lines; and Siemens (for the armoured post package. The original design contract was awarded to KBR in 2006.

For more news and expert analysis about Algeria, please see Algeria Focus and Algeria Politics & Security.

© 2012 Menas Associates

Algeria's oil and gas exports up by 38.3 per cent

Algerian's oil and gas exports have gone up by 38.3 per cent in the first six months of 2010, said the country's Central Bank Governor Mohamed Laksaci. He also told the parliament that foreign companies operating Algeria gas exported lower quantities of energy in the first half of this year compared with 2009.

"(The value of) energy exports reached $27.6 billion in the first six months of 2010, an increase of $7.65 billion or 38.3 percent from the same period last year.The exported quantities remained stable. They increased only by 1.65 percent compared with their level in the first six months of 2009. This time (first half of 2010), the quantities exported by (foreign) partners declined," said Laksaci.

Total, BP, Amerada Hess, StatoilHydro and Anadarko are among the main foreign energy companies in Algeria, which is also the world's eighth biggest exporter of crude.

Laksaci said the earnings rise was made possible by higher oil prices, which he said averaged $77.5 per barrel during the January-June period this year versus $52.2 in 2009.

Source: Reuters

For more news and expert analysis about Algeria please see Algeria Focus and Algeria Politics & Security.