- Operators Holding Back Investments, Reducing Drilling
The Managing Director/Chief Executive of Total Exploration and Production Nigeria Limited, Nicholas Terraz, says the current challenging economic environment is making operators in the industry to defer investments and minimise development drillings.
He said the situation was being aggravated by funding challenges for the joint ventures as well as low oil prices.
Terraz, who spoke at the 2016 Nigerian Association of Petroleum Explorationists Conference management session held in Lagos, said the situation had also resulted in the loss of activity and jobs for contractors providing services to the industry.
He said, “Throughout 2016, we have faced a challenging economic environment, with an average oil price around $45 per barrel. This environment requires us to adapt and reduce cost without compromising safety, while preparing for a future of growth or expansion.
“While the impact of the low oil price is not peculiar to only Nigeria, the country is particularly affected because a large part of its revenue comes from the hydrocarbon sector. In addition to low oil price, Nigeria has also experienced a reduction in production volumes due to security issues.”
The current context, he noted, was challenging for both the country and the industry, as the government was facing revenue shortages, while oil and gas companies, on their part, have had to adapt to the present realities.
The theme of the conference, ‘Nigeria Oil and Gas Industry: Tackling Our Realities’, Terraz noted, provided an opportunity to assess the current progress in the industry and the improvements envisaged going forward.
He said that Total had added over 2.3 billion barrels to Nigeria’s production from 1966 to 2015 and, in the last five years alone, had made approximately $10bn of investments in the country.
“Despite the challenging operating environment, Total remains strongly committed to the development of its activities in the country, while working relentlessly to adapt to the current environment,” he added.
In September 2015, the Total boss said the company achieved first oil from the Ofon Phase 2 development project, which will increase the production capacity from the Ofon field by 60,000 barrels of oil equivalent per day, adding that development drilling was currently on-going to reach the production plateau.
In addition, he said the firm’s Egina deepwater project, currently under development, would add 200,000 barrels per day to the national oil production by 2018.
“A key feature of the Egina development is the project’s record-setting contributions to in-country value. We are proud to say that the Egina project has the highest level of Nigerian content of any oil and gas project to date,” he added.
Global Deal Activity Down by 4.5% in October 2020
A total of 6,304 deals were announced globally during October 2020, which is a decrease of 4.5% over the 6,598 deals announced during September, according to GlobalData, a leading data, and analytics company. An analysis of GlobalData’s Financial Deals Database revealed that the deal volume during October remained below the monthly average of Q3 2020.
Aurojyoti Bose, the Lead Analyst at GlobalData, comments: “After demonstrating growth for four consecutive months, the deal volume shrank in October. The decline in deal activity could be attributed to inconsistencies across different regions. The APAC region remained a weak spot, while deal activity remained mostly flat in North America, and the Middle East and Africa (MEA) region witnessed growth in deal activity.”
North America attracted the highest number of investments, followed by APAC, Europe, the MEA, and South, and Central America.
The uncertain global economic landscape lowered the deal volume in October for major markets such as the US, Germany, Australia, France, India, and China compared to the previous month. On the contrary, the UK, Japan, South Korea, and Canada saw growth of 15.6%,14.9%, 3.8%, and 2.2%, respectively, in October as compared to September’s deal volume.
Bose continued: “Most of the deal types witnessed a decline in volume during October compared to the previous month. Private equity, equity offerings, venture financing, debt offerings, and partnership deals volume decreased by a respective 2.4%, 9.1%, 9.8%, 14.6%, and 24.6% – while the deal volume for mergers and acquisitions (M&A) increased by 7.2%.”
Japaul to Invest in Chinese Firm H&H to Deepen Mining and Exploration Business
Japaul Gold & Ventures Plc (Japaul), formerly known as Japaul Oil and Maritime Services Plc, announced it has gotten approval in principle from H&H Mines Limited to invest in or acquire shares in the company once it concluded its fundraising exercise.
According to a statement released through the Nigerian Stock Exchange (NSE), H&H Mines Limited has several licenses, which include two major Mining Leases for 25 years renewable.
The statement noted that extensive exploration has been done on the Mining properties and the last lap of the exploration works is core drilling. This, it said will allow Japaul knows the measured Minerals Reserve contained in the Mine, which it claimed contain Gold, Silver, Lead, Zinc, etc.
Japaul further explained that the need to get the drilling done was what led H&H Mining to engage the services of Xiang Hui International Mining Company Nigeria.
“Since Japaul will eventually be part of H&H Mines Limited, it was necessary that Japaul is carried along on the kind of Contract of Drilling to be entered into, and that was why the signing of the Drilling Contract between the Chinese Company and H&H Mines Limited was concluded at Japaul’s Head Office,” the company stated.
The drilling is expected to be concluded in the next 12 months and within this time, Japaul is expected to have concluded the Fund Raising and formalise her involvement in the Mining.
The company added that Canadian reports revealed that there are huge gold, silver, lead, etc deposits, but it is drilling that will show the actual reserve.
Africa Investment Forum (AIF) Rescheduled to Hold in 2021 – AfDB
Investment Forum to Now Hold in 2021 in a Bid to Curb Possible Second Wave of COVID-19
The Africa Investment Forum scheduled to hold in November 2020 in Johannesburg, South Africa has been rescheduled to hold in2021 as a result of the ongoing global health pandemic.
This announcement was made in a statement by AfDB on Wednesday. The African Development Bank (AfDB) and the Africa Investment Forum founding partners agreed to the postponement of the annual three-day investment market place.
Considering the negative effect of Covid-19 on the global economy, agreement by the two bodies was made after a careful assessment of the impact of COVID-19 on global travels, investments, observing the social distancing rules and curbing the likely possible risk of a second wave.
In the statement, the bank stated that through the forum innovative digital platforms, it would track investments, source for new deals, progress on financial closure of transactions and other existing deals.
“At the 2019 Africa Investment Forum, 57 deals valued at $67.7bn were tabled for discussions. Fifty-two deals worth $40.1bn secured investment interest.
“In July this year, the AIF Founding partners pledged to strengthen strategic partnership engagement and commitments for Africa Investment Forum Market Days 2021, to help ‘reboot investments in Africa.’ They underscored the need to boost local manufacturing while leveraging the continent’s vast resources to unlock investment.”
In the statement, Africa Investment Forum objectives are achieved through the forum’s four pillars; Closing, Connecting, Engaging and Investment Tracking.
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