Gabon needs major discoveries from deep water

Apr 27, 1998 02:00 AM

The West African state of Gabon, which is hard hit by the recent oil price crash, is pinning hopes for a long-term revival of its oil business on prospective deepwater acreage.
Paul Toungui, the Libreville government's oil minister, said oil production during 1998 was forecast to be 18.3 mm tonnes (315,000 bpd), up 1.5 % on last year, and was set to stay at this level for 2 years before a decline set in.
To arrest this production fall-off, Mr Toungui said major discoveries need to be made.
His government was optimistic that 13 new blocks on offer in its present ultra-deepwater licensing round would prove as prolific as Angolan and Congolese blocks to the south.
The round was launched last year with bids due in to the Libreville government this October.
US independent Vanco was awarded the first acreage in this round, the Astrid Marine licence.
While French oil major Elf remains the dominant player in Gabon's upstream sector - largely through historic colonial ties and with some suggestions of favouritism - it now appears to be concentrating its efforts and resources on the huge Angolan discoveries.
This strategy shift has left the field open for a wide variety of other oil companies ranging in size from Italy's Agip and Amerada Hess of the US to Forcenergy and Ocelot of Canada.
Other players include Energy Africa, which has a wide-ranging deal with the Gabonese giving it certain rights to much of the country's prospective oil and gas areas, Chauvco (US) and Perenco of France.
Improved fiscal terms and the general attractiveness of West Africa have also stimulated interest in the past few years.

Most of the new fields due to be brought into production in Gabon this year - 5 in all - are small with recoverable reserves of 5 mm - 20 mm barrels.
However, the majors, including Elf and Shell, are thought to be interested in Gabon's deepwater licences, with observers suggesting that the prolific Tertiary play found in Angola and Congo (Brazzaville) also extendsinto Gabonese waters.

The need to make discoveries has been given an added sense of urgency because Gabon, which relies on oil for 40 % of its gross domestic product, has suffered during the recent plunge in oil prices.
Before the slump earlier this year, Libreville had forecast 1998 GDP growth at 4.1 %. But this has now been revised downwards to about 1 %, said Luc Oyoubi, director-general at the Ministry of Finance.
Oil revenue for 1998 is expected to be $ 750 mm, based on an oil price of $ 14.5 a barrel of benchmark crude, compared with figures of about $ 1.5 bn and $ 19.39 respectively for last year.

Source: not available
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