Gulf of Guinea: who will win the oil battle?

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The disagreement began in 2007, when Ghana discovered the so-called Jubilee oil field located on the shared border. To avert any trouble, the Ivorian and Ghanaian authorities created a joint commission in 2008. However, this did not stop Ghana from continuing its offshore exploration and allowing Tullow Oil, a British company, to develop Jubilee in 2010. In 2013, Côte d’Ivoire responded by awarding French oil company, Total, a licence to operate in an oil field in the same zone.

[…]

The disputed maritime space could have been transformed into an area of common interest if the countries had signed a petroleum product-sharing contract with an agreed allocation, as Nigeria and São Tomé and Príncipe had done in 2001. The former received 60% of the production and the latter 40%. They could also have created a joint operating company like Libyan-Tunisian Joint Oil, which was founded in 1988 by Tunisia and Libya to resolve their maritime border dispute, and whose profits are divided equally between the two countries.

[…]

It is unfortunate that these two member countries of the Economic Community of West African States (ECOWAS) have instead chosen to confront each other in an international court. But the process is not irreversible, as Ivorian and Ghanaian authorities could still withdraw their requests and return to the negotiating table. If not, they are heading towards a sentence that could damage their peaceful history.

[…]

Source: ISS Africa | Gulf of Guinea: who will win the oil battle?

Rich Links: Gas Revenues in Tanzania

  • “With the gas industry expected to be the largest player in Tanzania’s economy, the Tanzanian government could face substantial losses if they do not act to curb bad policies and practices.  Here are three major issues Tanzania needs to tackle in order to ensure they capitalize on upcoming gas revenues:”

  • “Mining prospectors will be able to apply for licences online and get feedback within 90 days, according to new amendments to the Mining Bill.”

  • “By the evidence of South Sudan’s budget, presented to parliament in late June, the country’s finance ministry has lost its mind.”

  • The Norwegian Ambassador to Ghana, Mrs. Hege Hertzberg, has urged the Ghana government to use the oil resource to transform the country’s economy from import dependent, to become a leading exporter on the African continent.

  • “Built by a consortium led by British company Globeleq, the 138 megawatt (MW) wind farm is one of Africa’s biggest – larger than the 120 MW Ashegoda windfarm that was unveiled by Ethiopia in October 2013, though not as big as the Tarfaya wind farm in south-western Morocco, which started producing energy in April and will eventually generate up to 300 MW of electricity.”

  • “Some neighbouring countries are less upbeat about the project. Citing two treaties, dating from 1929 and 1959, Egypt claims a historic right over the Nile. It fears that the dam will restrict the flow of water. […] “These treaties are now obsolete. We are entitled to build the dam,” says Alemayehu Tegenu, Ethiopia’s minister of water, energy and irrigation. “For a long time we derived no benefit from our river.”

  • “Unfortunately, Tullow could not repeat its African success story in Ethiopia. […] Sources told The Reporter that executives of Tullow decided to suspend drilling operation in Ethiopia. “They will pull out their drilling crew out of Ethiopia. They will take out their core staff to other projects in other countries and lay off the rest of the staff in their Ethiopia office.”

  • “Zimbabwe’s cotton industry will remain under pressure as international lint prices continue to wane with China’s imports expected to decline in the 2014/2015 season as the Asian nation shifts to domestic cotton for national reserves.”

  • “The duration of license now depends on the size and nature of mineral deposits, as well as the size of investment to be injected in a concession. This will be shown through a feasibility study conducted by the investor.”

Rich Links: Natural Gas in Tanzania, Nuclear Power in South Africa and More

As always, the best links from around the internet:

New policy on natural gas coming soon in Tanzania

The government of Tanzania is on the verge of passing a new national policy on natural gas exploitation. So far the country has no specific official policy in that sector and the new legislation wants to address specifically the issue of local content. AllAfrica/Tanzania Daily News (2)

South Africa aims for new nuclear power plants

The South African government pushes for the construction of new nuclear power plants to increase the generation of nuclear energy from 1,800 MW to 9,600 MW per year by 2030. Key financial decisions are planned to be taken this financial year. South Africa currently runs the only active nuclear power plant on the African continent and pursues a large nuclear capacity under the label of “clean” and indigenous energy. AllAfrica/SouthAfrica.info

Resources in the DR Congo

A detailed look at the trends and challenges of the natural resources sector in the Democratic Republic of the Congo. Ventures Africa

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Search for oil kills whales off Madagascar

A sonar system, operated by Exxon Mobile to explore oil fields off the Madagascan coast, is the reason for the death of dozens of melon-headed whales. This is the finding of an independent scientific commission. Global Post

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The governments of South Sudan and Kenya are currently planning the establishment of a new pipeline corridor to transfer Sudanese oil to the Indian Sea at Lamu. This article argues that the better alternatives would be to transfer the oil by either rail or road. AllAfrica/Pambazuka News

High hopes for Rwandan mining sector

The Rwandan government wants the country’s mining exports to triple by 2017. AllAfrica/Rwanda Focus

Rich Links: Sudan fuel price protests and Congo’s oil law

The most important developments and most interesting reads around resource politics in Africa from around the internet:

End of fuel subsidy sparks violent protests in Sudan

In an attempt to limit government spending, the Sudanese fuel subsidy was cut in a surprise move, sending fuel prices at the pump sky-high. Prices almost doubled overnight, from $2.83 to $4.71. Protests erupted in the capital Khartoum and around the country, leading to at least 29 deaths. The demonstrations were said to be the largest of President Al Bashir’s 24 year rule. Schools were closed and the internet connection to parts of the country is cut off. Al Jazeera

Why hasn’t Botswana diversified out of Diamonds

Interesting Analysis on the question, why Botswana despite its sound political institutions and solid economic growth has so far not managed to move away from an extraction-based economy. Why Nations Fail

Congo’s oil law

The DRC’s proposed oil law would open the door to exploration in national parks (especially Virunga) and doesn’t provide any means to ensure transparency in the allocation of contracts and revenues. Think Africa Press

Ghana’s gold production likely to drop by 18%

Due to falling world market prices, gold producers are cutting their production in Africa’s second largest exporting country. This could have severe consequences for government revenues, with oil production already well below targets. The government has won elections mainly on the promise of investing heavily in power production and other infrastructure and planned on using funds from resource extraction to deliver on these promises. Mining Review

Rich Links: No Gas in Ghana, No Phosphate in Nambia, But More Oil in Libya

Some worthwhile reading from around the web:

Namibia bans phosphate mining

The Namibian government has declared a moratorium on phosphate mining in coastal waters. This is a reaction to ongoing protests from the fishing industry. The government and mining companies had plans to start exploiting the underwater reserves of phosphate, but mining phosphate at sea has never been done before. Fishermen and their employers — fish is one of Namibia’s most important exports — are afraid of possible negative environmental consequences of the mining endeavour. Mining Review

No gas for Ghana

The gas pipeline delivering natural liquified gas from the Jubilee oil field to several gas power stations in Ghana won’t be ready until 2014. The pipeline was due to go online at the beginning of this year, but the sinking of a ship with supplies and financing problems delayed are delaying completion. Ghana experiences severe power outages since a shipping accident made gas supply from Nigeria unreliable and solving the energy crisis has been a main campaign issue in the recent elections. AllAfrica/The Cronicle

Oil flows again in Libya

About thirty per cent of Libya’s oil production capacity has come back online, after militias opened the valves on an important pipeline in the west of the country. Several militias and regional groups are using oil flows to put the Libyan government under pressure in negotiations over jobs, payment and decentralisation of political power. Libyan oil is mostly exported to southern Europe and the row has led to rising prices on world markets. New York Times