Equatorial Guinea grants PSCs for three offshore oil and gas blocks

The government of Equatorial Guinea has awarded production sharing contracts (PSCs) to Africa Oil Corp for offshore Blocks EG-18 and EG-31.

Africa Oil Corp inked the deal with the country’s Ministry of Mines and Hydrocarbons that will see the firm holding an 80% operated interest in each block, with the remaining 20% to be held by GEPetrol, the national oil company of Equatorial Guinea. GEPetrol also has the option to acquire an additional 15% participating interest in each block. Africa Oil Corporation was advised in this transaction by a team from Fasken, led by Partner Abayomi Akinjide.

READ:Teraco to construct 120MW solar plant in South Africa

Potential

The minimum work commitment for both blocks during the initial exploration periods is a combined total of US $7M. There is no drilling commitment at this stage.  Block EG-31 contains several gas-prone prospects in shallow water depths of less than 80 meters. These prospects are located close to existing infrastructure, including the offshore Alba gas field and the onshore Punta Europa LNG Terminal. Future discoveries here could lead to low-cost, low-risk gas development opportunities targeting international LNG markets.

Africa Oil has identified a potentially large and highly prospective basin floor fan prospect of Cretaceous age in Block EG-18. This prospect is similar to those within the company’s exploration portfolio in Namibia and South Africa.

“The award of block EG-01 is a natural and complementary expansion of our portfolio in Equatorial Guinea and in line with our infrastructure led exploration strategy, increasing our access to a large inventory of oil prospects and leads within tie back distance of existing production facilities for a modest financial exposure,” said Panoro CEO John Hamilton.