Angola, Africa’s second-biggest oil exporter after Nigeria is set to flag off a licensing bid round for oil blocks as Nigeria’s continue to lie fallow at a time when the country is in dire financial straits.
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In what has been described as a well-attended licensing round roadshow in London during the week ending September 22, Angola’s National Agency for Petroleum and Gas (ANPG) unveiled the final schedule for an acreage auction that will end in April next year.
The anticipated round, covering 10 blocks in the frontier Namibe and Benguela basins in the country’s southern waters are due to open on October 2, with offers to be submitted by November 12, giving interested companies just 40 days to evaluate data and bid, according to a report by Upstreamonline.
Hermengildo Buila, ANPG director of negotiations pointed out that “all investors currently in Angola” contributed to establishing the 40-day turnaround time.
Sources argued that companies not currently active in Angola will find it a challenge to meet such as tight schedule, suggesting that in-country incumbents will have an inherent advantage.
However, Nigeria’s story reads differently. With a maximum crude oil production capacity of 2.5 million barrels per day, Nigeria is comfortably Africa’s largest producer of oil and the sixth-largest oil-producing country in the world.
The country has a total of 159 oil fields and 1481 wells in operation. With African peers ramping up efforts to grow their oil and gas production and reserves; Nigeria’s last licensing round was in 2008.
Data obtained from the Department of Petroleum Resources, Nigeria’s oil and gas industry regulator show that out of 390 oil blocks in the country, 211 are yet to be allocated by the federal government.
The country has seven basins, namely Anambra, Benin, Benue, Bida, Chad, Niger Delta and Sokoto. As of December 2017, 179 blocks had been allocated comprising 111 Oil Mining Leases (OML) and 68 Oil Prospecting Licences (OPL).
In Anambra, 12 out of 19 blocks have not been allocated; in Benin, 39 out of 50 are open; in Benue, 41 out of 43 are still idle, while none of the 17 blocks in Bida has been allocated.
In the Chad basin, 40 out of 46 blocks are open; in the oil-rich Niger Delta, 34 out of 187 blocks are still idle, while Sokoto’s 28 blocks remain unallocated.
Ibe Kachikwu, former minister of state for petroleum resources suggested plans to do oil license bid rounds, noting that things would definitely lookup for the sector once this is done but he, however, did not give a timeline.
As Nigeria dithers, offshore exploration and field development have gained momentum in many sub-Saharan Africa countries, with numerous licensing rounds underway in many parts of the African continent.
The long list of African countries opening offshore blocks to licensing include Gabon and Somalia already underway with international roadshows. Other countries contemplating licensing bid round are Republic of Congo, Côte d’Ivoire, Ghana, Guinea, Madagascar (for the first time offshore), Mauritania, Nigeria, Senegal, and Sierra Leone.
In Angola, once the offers have been opened in public on November 13, the ANPG, Ministry of Finance and Ministry of Petroleum will have until December 28 to evaluate both the bids and the companies aiming to secure acreage and address inconsistencies.
Concessions are due to be awarded by January 17, with talks, including an appeal and response process, to run until March 27. Production sharing contracts are due to be signed by April 30, and will have an effective date of May 4, the first working day of the following month.
