Business News of Sunday, 10 November 2002
Source: Kofi Akosah-Sarpong
BUSINESS/ECONOMY: PREVIEW OF WEST AFRICAN OIL FORUM IN TEXAS,USA
As the emerging West African oil and gas boom increasingly caught the eyes of the international community, the United States-based Corporate Council on Africa is to host a major West African oil and gas forum on November 19-20 in Houston, Texas. West Africa magazine?s Kofi Akosah-Sarpong, who has for the past six months been monitoring and evaluating the African oil and gas sector, previews the impending conference
West Africa?s fast emergence as global oil and gas power is being boosted at a top international oil and gas conference in Houston, Texas. To be hosted by the Washington-based the prestigious Corporate Council on Africa (CCA) at Houston?s Westin Oaks Hotel, the conference, entitled ?West Africa Oil & Gas Forum,? is billed as further opening up the West African oil and gas to the international community. Sponsored by ExxonMobil, ChevronTexaco and Vanco Energy, the forum will spotlight West Africa?s oil and gas production and opportunities for the United States petroleum industry. United States Assistant Secretary of State for Africa, Walter Kansteiner, opens the forum, which will be attended by West African petroleum ministers, senior level executives from major United States and international petroleum companies and other United States government personnel administering African policy. The Corporate Council on Africa, established in 1992, is a nonpartisan institute of nearly 160 American companies dedicated to strengthening trade and investment ties between the United States and Africa. CCA members represent nearly 85 percent of total United States private sector investments in Africa.
Key audience will include government and national petroleum company representatives and stakeholders from Angola, Cameroon, Chad, Republic of the Congo, Equatorial Guinea, Gabon, Ghana, Mauritania, Nigeria and Sao Tome & Principe, as well as United States oil and gas executives. African oil and gas heavyweights who are expected to attended the forum include Desid?rio Costa, Vice Minister of Petroleum, Angola; Joseph Aoudouf, Minister of Mining, Cameroon; Ousmane Mahamat Nour Elimi, Minister of Petroleum, Chad, Tom Erdimi, National Petroleum Coordinator, and Abdelkerim Hissein Moussa, Director of Oil Exploration & Production both from Chad; Tati Loutard, Ministry of Hydrocarbons, Congo-Brazzaville; Bruno Itoua, President, SNCP Equatorial Guinea; Cristobal Manana Ela, Minister of Mines and Energy, and Richard Onouviet, Minister of Mines and Energy both from Gabon; A. Kan-Dapaah, Minister of Energy, Ghana; Rilwanu Lukman, Special Presidential Advisor on Petroleum and Energy to Nigerian President Obasanjo, Gaius Jackson Obaseki, Group Managing Director, Nigerian National Petroleum Corporation (NNPC); and Rafael Branco, Minister of Natural Resources, Sao Tome & Principe.
Interest in West African oil and gas as a major source of energy for the United States continues to grow as national planners look to decrease dependence on the turbulent Middle Eastern supplies. Over time as, new technology makes it easier to explore and produce oil and gas, the West African region has become vital to businesses in the United States petroleum industry as production, new discoveries, and exploration develop at a fast pace. Currently, the West African region supplies almost 15 percent of United States energy needs and imports are expected to rise to nearly 25 percent by 2005. Commentators say the ?West Africa Oil & Gas Forum? will ?provide United States companies accurate guidance on the political and economic situations in the region as well as direction on related U.S. government policy.? Plenary sessions will include: Energy, Infrastructure and Economic Development: A Public-Private Partnership for Economic Growth, African Oil and U.S. Priorities, and Risk Management in African Oil Investments. Individual country workshops will address petroleum and energy priorities; upcoming procurement and bloc biddings; and the regulatory environment.
Africa?s Gulf of Guinea region has become vital to businesses in the United States petroleum industry. Production, new discoveries and exploration are growing at a fast pace. Currently, the West African region supplies almost 15 percent of U.S. energy needs and imports are expected to rise to nearly 25 percent by 2005. ?This timely forum will focus on oil & gas production and opportunities for the U.S. petroleum industry and related investors in African countries bordering the Gulf of Guinea,? said the Corporate Council on Africa. ?This region?s political climate will also be highlighted. The program is designed for a senior level audience composed of African petroleum ministries and national petroleum company representatives to meet with U.S. petroleum officials and U.S. government personnel administering African policy.?
Oil experts predict that the amount of oil the United States receives from the prolific fields of Nigeria, Equatorial Guinea and Angola will double in the next five years. ?African oil is of strategic national interest to us and it will increase and become more important as we go forward,? Kansteiner said during a July 2002 visit to Nigeria, the largest oil producer in West Africa with an estimated 24 billion barrels in reserve. United States Vice President Dick Cheney, a former oil company executive, predicted the same a year earlier, when, referring to the instability of Mideast oil, said, ?Along with Latin America, West Africa is expected to be one of the fastest-growing sources of oil and gas for the American market.? At present, United States oil firms dominate the West African oil and gas landscape. ExxonMobil, Amerada Hess, Chevron Texaco and Marathon Oil have the largest share of the West Africa?s oil production. Based on new discoveries, analysts expect their total collective investment of US$3 billion to approach about US$5 billion by the end of 2002.
Already, United States largest investment in Africa is in the Chad and Cameroon oil and gas venture which totals about US$3.7 billion. The United States has denied persistent reports that it intends to build a military base on the tiny West African island state of Sao Tome, but said it will expand co-operation with the former Portuguese colony. United States interest in the West African region centres on large offshore oil and gas deposits in the Gulf of Guinea and a desire by Washington to diversify its oil and gas supplies away from the turbulent Middle East region. Seeking secure oil ahead of threatened conflict with Iraq, the United States is stepping up overtures to oil-rich West African nations, with plans announced to establish a U.S. naval base off West Africa to safeguard the strategic United States interest. On September 13 President Bush spoke with leaders of at least nine West and Central African nations, all either already steady producers or in the thick of West Africa's oil production and exploration boom. Among the leaders who met Bush were President Fradique de Menezes of Sao Tome and Principe. Menezes announced August 22 that his country, believed to be sitting on massive and largely untapped oil reserves, had reached agreement with the United States for establishment of a U.S. naval base there.
One key United States company in the thick of the West African oil and gas boom is ExxonMobil. The company is the first oil multinational to launch commercial exploration in Equatorial Guinea?s offshore waters in 1995, and controls the Zafiro oil field. Stretching from 25 to 60 miles offshore, it is Equatorial Guinea?s most productive field, with a potential yield of close to 200,000 barrels of oil per day. ExxonMobil?s oil vessel Zafiro Producer pulls out about 160,000 barrels per day, and the Magnolia stores the oil for refining until shipment across the Atlantic to markets in the United States. Equatorial Guinea shows the microcosm of the schism in the coming West African oil and gas boom and how it may look like if civil society does not take it up earlier. Ahead of the Houston West African oil and gas forum investigations by the United States-based International Consortium of Investigative Journalists (ICIJ), which extends globally the Center's style of "watchdog journalism" in the public interest by marshaling the talents of the world's leading investigative reporters, says ?the 23-year-old regime of President Teodoro Obiang Nguema Mbasogo has been criticized for allowing the oil companies to exploit Equatorial Guinea?s oil riches with little obvious benefit to the people.
The U.S. Energy Department notes that the government?s share of oil revenues is relatively small by international standards. Obiang has announced plans to renegotiate contracts to increase the country?s participation in oil licenses. Meanwhile, the president and his family have been buying up multimillion-dollar homes in the United States. ? The government gave the American oil companies carte blanche and threw its doors open,? said Christanio, a Jehovah?s Witness missionary from Canada who has spent nearly four years in the capital Malabo. ?The Americans are slicing their way effortlessly through the oil blocks.?