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AFRICAN ENERGY

OIL GAS POWER POLICY & FINANCE

www.africa-energy.com Issue 247 31 January 2013

Pipeline attacks add to fears of protracted regional


conflict despite end to Algerian hostage crisis
A second attack in the Algerian hydrocarbons fortress and an emerging narrative in which western governments
see an arc of instability spanning the Sahara/Sahel region means IOCs must reassess their attitudes to regional
risk following the traumatic In Amnas gas plant siege, write Jon Marks and John Hamilton

T
he launching of homemade rockets at a pipeline running the Sahara and mountainous parts of Kabylie, a redoubt for the
north from the Algerian gas hub of Hassi RMel late on ultra-radical GSPC group which last decade morphed into
27 January was claimed by Al-Qaeda in the Islamic AQIM than the well-orchestrated In Amnas attack, which
Maghreb (AQIM). The attack lacked the detailed planning was carried out by a multinational jihadist team. The pipeline
and shocking loss of life of the 16-19 January incident at the attackers melted into the night as army units searched the An
BP/Statoil/Sonatrach gas production facility at In Amnas, Chikh region, on the southern edge of Kabylie.
which left 37 foreign workers dead and five unaccounted for. But the An Chikh attack underlined the message of In Amnas:
But claimed by Algerian Islamist cell leader and desert racketeer that jihadists had burst the bubble of impregnability that
Mokhtar Belmokhtar, it was just as worrying for international surrounded the hydrocarbons fortress established in the blood-
oil companies (IOCs), the Algiers authorities, European energy soaked 1990s. With it, established perceptions of IOC security,
strategists and governments which have been struggling to make Algerias political and energy relationships, and wider operations
sense of a conflict in the Sahara/Sahel region that seems now to in a region stretching from Mauritania to Somalia have come
have spread further north into the Algerian hydrocarbons under intense scrutiny (see Testing questions for IOCs and
fortress. governments after bloody end to Algerian hostage crisis, posted on 22
The 27 January attack was more reminiscent of Algerias low- January at www.africa-energy.com).
intensity war with radical Islamists in recent years focused on CONTINUED ON PAGE 3

LNG plans Azeri tie-up Canada gets tough on bribery


Anadarko has awarded Afren affiliate Gasol has agreed A bribery conviction against Venture Exchange, and in 2011,
multiple FEED contracts for Griffiths Energy International the OECD and Transparency
a strategic alliance with has been welcomed as a sign International criticised Canada
the onshore and offshore Azerbaijans Socar Trading for that Canada is acting to tackle for doing too little to enforce the
elements of its planned LNG
its proposed LNG import its reputation for being less tough 1999 Corruption of Foreign Public
plant in northern on corruption than the US or UK, Officials Act. Since then,
Mozambique. But, as Rio project in Benin. Socar will
even though the company Canadian police have stepped up
Tinto found with its recent supply LNG and help provide uncovered the payment itself, their efforts, prosecuting Niko
coal infrastructure woes, a storage vessel for the project, and reported it to the authorities. Resources in 2011 over
development may not be plain which aims to supply gas- Griffiths has been fined a record payments in Bangladesh, and
sailing. Anadarko and Eni have C$10.35m over a $2m payment now investigating SNC-Lavalin
hungry clients in Benin, Togo
by late founder Brad Griffiths to over its relations with Saadi
agreed to co-ordinate and Ghana, replacing gas flows a company owned by the wife of Qadhafi.
development, and once all the promised, but not delivered, by the Chadian ambassador to the
designs and estimated costs are US and Canada. Griffiths new management,
the West African Gas Pipeline.
submitted, an LNG contractor meanwhile, stress that the
and an offshore contractor will In the longer term, Gasol There have long been doubts matter is now closed and they
hopes to supply associated gas about governance at some of the are concentrating on developing
be selected, with the target of
many resource companies listed their Chad operation.
starting production in 2018. from Afrens Nigerian oilfields.
on the Toronto Stock Exchange
SEE PAGE 17 SEE PAGE 18 and its junior market, the TSX FOR MORE, SEE PAGE 19

ISSN 1463-1849 Cross-border Information


Contents

FOCUS

AFRICAN ALGERIA: Pipeline attack fuels fears of protracted crisis


REGION: Canada gets tough on bribery
ALGERIA: Parliament approves new hydrocarbons law
1
1
3

ENERGY MAP: Production, pipelines and January incidents


ALGERIA: The In Amnas attack
4
6
OIL GAS POWER POLICY & FINANCE LIBYA: New regional security threat 7
POWER
African Energy
Issue 247 31 January 2013 MOROCCO: Taqa finalises Jorf Lasfar financing 8
GHANA: Takoradi II reaches financial close 8
Sales and Service BOTSWANA: BPC and Eskom agree new deal 8
ZAMBIA: First Quantum plans transmission line 9
Direct: +44 (0) 1424 721 667
Fax: +44 (0) 1424 721 721 SOUTH AFRICA: REIPP developments 9
Email: info@africa-energy.com POINTERS: Cte dIvoire DR Congo, Ethiopia 10
POINTERS: Morocco, Tunisia, Uganda 10
Director Nick Carn
nick@cbi-publishing.com POWER UPDATE: INDIAN OCEAN ISLANDS
Manager Helen Ogden OVERVIEW: Diversification is key 11
helen@cbi-publishing.com UPDATE TABLE: Planned and operating projects 11
MAP: Power generation in the Indian Ocean islands 13

Editor UPSTREAM OIL AND GAS


Thalia Griffiths MOROCCO: Chevron agreements, Plains Exploration stake 15
thalia@africa-energy.com GHANA: Eni appraises Sankofa discovery 15
REGION: Elenilto in West Africa push 15
Editorial Director
Jon Marks NAMIBIA: Galp farm-in approval paves way for drilling 16
jon@africa-energy.com SOUTH AFRICA: Thombo launches seismic survey 16
POINTERS: Gabon, Wilton Resources 16
Cartographer
SOUTH AFRICA: Kinetiko widens CBM area 17
David Burles
REGION: Aminex loses chief executive 17
Contributing Editors
Eleanor Gillespie, Kevin Godier, John Hamilton, DOWNSTREAM HYDROCARBONS AND MARKETS
Oualid Khelifi, Leonard Lawal (Lagos), Dan Marks, MOZAMBIQUE: Anadarko awards LNG FEED contracts 17
David Slater, Franois Misser (Brussels) BENIN/REGION: Gasol links with Azeris for LNG supply 18
Production POINTERS: Algeria, Angola, Cte dIvoire 18
Shirley Giles FINANCE AND POLICY
CHAD: Griffiths Energy guilty of bribery 19
2013 Cross-border Information. All rights reserved. CHAD: Tyab brothers influential role 20
NIGERIA: IFC issues naira bond 20
Single subscriptions of African Energy are available in Internet format
including online and emailed content. Data and information published POINTERS: AfDB, Sudan, Madagascar, Tanzania 21
in African Energy is provided to Cross-border Information (CbI) by its
DIARY
staff and network of correspondents through extensive surveys of
sources and published with the intention of being accurate. CbI cannot EVENTS: Whats on around the region 22
insure against or be held responsible for inaccuracies and assumes no AFRICAN ENERGY VIEW
liability for any loss whatsoever arising from use of such data. No por-
tion of this publication may be photocopied, reproduced, retransmitted, MOROCCO: Pushing security from renewables 23
put into a computer system or otherwise redistributed without prior au-
thorisation from Cross-border Information.
Contact subscriptions@africa-energy.com for details of multi-user
subscriptions.

2 AFRICAN ENERGY ISSUE 247 31 JANUARY 2013


Focus

Algerian parliament approves new hydrocarbons law


Algerias long-awaited hydrocarbons law revisions were finally not concerned about false or misleading financial statements by energy
approved by parliament on 21 January, five months after the law was partners, but about potential errors in calculations.
adopted by the government and Council of Ministers. Some
Some elements of the revised law are a reaffirmation of the
international oil executives gave them a cautious welcome, while others
governments nationalist economic policies. Among notable measures,
said the new terms were too little too late. The revised text was passed
it gives Sonatrach exclusive ownership of pipelines and hydrocarbons
by an overwhelming majority of deputies, who voted to amend 58
transportation activities.
articles and introduce nine new ones to Law 05-07. The new law was
promoted to much acclaim in 2005 by then energy and mines minister With domestic gas consumption rising fast, potentially thorny issues are
Chakib Khelil, but was subsequently revised under pressure from raised by an article intended to ensure that sufficient supplies are
resource nationalist opinion in 2007. available for local consumers by forcing partners to concede some of
their production should Sonatrach and its affiliates fall short of
International oil companies (IOCs) largely boycotted the last three satisfying local demand. According to one regional energy expert,
licensing rounds and, aware of the need to make the investment Algeria seems to be following down the road taken by Egypt, whose
framework more attractive, the energy industry has looked to revised domestic economics have led it to plan for imports (AE 246/1).
fiscal terms that might revive interest. Under the new law, the
methodology for determining the taxe sur le revenu ptrolier (tax on
revenues) is to be based on profitability rather than turnover. Unconventional incentives
As expected, incentives to promote exploration for unconventional
Also likely to go down well with investors is the introduction of the resources which has attracted considerable interest from companies
impt complmentaire sur le rsultat (ICR), a tax formula believed more including Eni and Royal Dutch Shell are written into the revised
rational and less punitive than the controversial old taxe sur les profits hydrocarbons law. For the first time, legislators have specifically
exceptionnels, which scared away big players and inflicted multi-billion addressed shale gas and other unconventional resources, introducing
dollar losses on state company Sonatrach as disputes with tax incentives to encourage activities related to geologically complex
international partners were settled. ICR rates will start at 19%, but perimeters. Following debate in the APN and concerns from
could reach 80% depending on production volumes and profitability. environmental groups, terms on environmental safeguards for fracking
were written into the final version. Small deposits are specifically
Exactly how the ICR will be calculated has yet to be published, and
targeted, as well as areas that have been underexplored and/or lack
there are concerns that the 2013 fiscal incentives exclude deposits that
infrastructure. Also as expected, fiscal enticements have been included
are currently being exploited. It is not explained how this would work in
to encourage offshore E&P.
existing blocks that are both producing and under development for
example, by drilling into new and complex structures, or applying Much depends on the details of fiscal terms still to be published, and
advanced recovery techniques. how the new law is implemented and interpreted. Some local critics
voiced dismay at the timing of the vote, which coincided with the In
Amnas hostage crisis. Although the dates for parliamentary debate
The state remains dominant
were scheduled in early January, independent commentators said the
The new law gives Algiers the means to tighten scrutiny over the sector
vote should have been postponed. Others argued that legislators
by introducing provisions by which all IOCs become fiscal subjects when
should have waited to consider whether the rising security threat in the
they operate in Algeria, obliging them to register for local taxation and not
south and around energy sites could also be addressed through the law,
operate through offshore subsidiaries. Energy and mines minister Youcef
but this was soundly rejected by Yousfi, who argued that important
Yousfi said this would overcome a legal loophole by which Sonatrach
legislation should not be influenced by immediate events.
alone has been subjected to fiscal control. According to tax revenues
department director-general Abderrahmane Raouia, the authorities are OUALID KHELIFI

Fears of protracted regional conflict of eliminating the Islamist militants who had invaded the plant.
This sent out a message that deals wont be done by the
CONTINUED FROM PAGE 1
military/security establishment (see Cross-border Informations
An informative dissection of the workings and strategy of Algerian Hydrocarbons risk report posted on 18 January 2013 at
AQIM published in late January by the Quilliam Foundation, a www.africa-energy.com).
think-tank monitoring radical Islamist activity, titled Its a
One consequence will be that security levels are raised,
Salafi-Jihadist Insurgency, Stupid!, argues that the In Amnas
although this will mainly be left to the Algerians to achieve, as
attack shows the difference in AQIMs tactics to some of its
the authorities have reiterated their public disdain for western
affiliate groups. The briefings author, Quilliam president
security companies and determination that boots on the
Noman Benotman, told African Energy he believed the
ground remain Algerian. Energy and mines minister Youcef
hydrocarbons sector is now the main target in Algeria.
Yousfi was quick to say there would be no opening up to
As the In Amnas siege closed on 20 January, the Algerian western security companies, which are present in a discreet
security services could claim they had achieved their main aim, advisory role to IOCs, but whose operations are highly

AFRICAN ENERGY ISSUE 247 31 JANUARY 2013 3


4
GASDOTTO ALGERIA
PORTUGAL SARDEGNA ITALIA
Kabylie mountains: some (GALSI) TO ITALY
El
S PA I N residual Islamist activity Haouaria
EL HARRACH
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Focus

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B A S I N IN SALAH ASSEKAIFKAF
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African Energy 2013
Algeria: Main production centres, pipelines & January 2013 incidents

(www.africa-energy.com)

AFRICAN ENERGY ISSUE 247 31 JANUARY 2013


Focus

constrained. While it insists its security forces are fit for purpose worrying. But other IOC sources were more sanguine. One
defending foreign workers and investments, Algiers is looking of the many executives who spoke to African Energy in late
for increased security co-operation from western allies. This is January suggested that the attack did not [represent] a sea
a long-standing theme of Algerian securocrats, which was change it is par for the course in Algeria and Libya. We have
expected to be discussed on 30 January when Prime Minister always been super-careful. There is no massive change as these
David Cameron paid a visit to Algiers, the first by a UK things are already implemented The Algerians know what
premier since independence. they are doing. But even this source called In Amnas a
wake-up call that required a re-evaluation of all the security
Duty of care measures that we take.
The loss of life at In Amnas and wider concerns about IOCs are somewhat powerless. We have our security guys out
deteriorating Sahara/Sahel risk pose critical questions for IOCs there assisting, but the onus is on Sonatrach, the military and
about their security and duty of care to employees. Strategic the gendarmerie to manage the risk and give us the comfort
analysts are rethinking approaches to what is being called the that they are enough of a deterrent for something like this not
arc of instability, a freshly minted term for the region
to happen again. They need to be much more proactive, said
stretching from Mauritania to Somalia that now seems to
one source. The army units assigned to facilities were poorly
include Algeria and Libya.
led, poorly trained conscripts. Local staff were not even
One supermajors political risk specialist expressed a widespread obliged to wear identity badges. Meanwhile, the DRS has
view in industry and government when he told African Energy been playing with fire, he said, alluding to claims the security
he was alarmed by the Algerian security forces priority of services had infiltrated groups such as Belmokhtars, but had
eliminating terrorists, rather than allowing a protracted hostage ultimately failed to prevent the attack.
standoff that might save workers lives. If an IOC couldnt
Added to this is the perception that, even with a revised
count on a host government to give its employees safety the
hydrocarbons law (see page 3),Algeria is not notably welcoming
highest priority, it would have to reassess its presence, he argued.
to IOC investment. A few IOCs that were winding down their
This is a major issue that will be debated across the industry.
Algerian commitments anyway may pull out entirely after In
Another industry source with operations in Algeria described Amnas. Those most affected such as Norways Statoil have
the In Amnas attack as a game changer. He said:We have entered a period of reflection, while urgently reassessing more
always accepted a degree of risk working in Algeria a security short-term security priorities. But others will stay, arguing that
risk along with the commercial risk [which] we have assessed the countrys subsurface potential outweighs above-ground
and mitigated A large part of that mitigation has been risks.
around the military and Sonatrachs involvement with the
Early on 20 January, UK supermajor BP completed the
military.
precautionary evacuation of more than 35 non-essential staff
In question is the ability of the military and the powerful from In Salah, Hassi Messaoud and other locations, saying it
Dpartement du Renseignment et de la Scurit (DRS) military was keeping the security situation across the region under
intelligence service to guarantee security and maintain their close review. By 19 January, Statoil had brought 51 staff
decades-long hegemony in Algerias southern hinterland. A members out of Algeria. Spains Cepsa and US-based Hess
number of analysts have argued that the attack and its brutal have also withdrawn staff.
resolution have damaged the authority of DRS chief Major
General Mohammed Tewfik Medienne and his deputy Frances GDF Suez evacuated 40 foreign workers involved in
General Bashir Tartag, who commanded the In Amnas the $1.5bn Touat gas project in the Adrar region of south-west
operation. There is speculation about another behind-the- Algeria, several hundred kilometres from In Amnas. Analysts
scenes power struggle in Algiers, ahead of Mediennes suggest that, if violence in Algeria is a response to President
long-anticipated retirement. Francois Hollandes intervention in Mali, then French
interests could become a particular target. Michelin is among
IOCs in general were under the impression that we were non-oil sector companies that have temporarily withdrawn
working in a very well-controlled environment, said the staff.
industry source. But this confidence has evaporated:We just
saw the level of risk dramatically increase and we have reached In the arc of instability
a point where we have minimal manning in country we
Western governments are frantically deploying human and
believe we are servicing our contract. Now we have to
material resources to understand and cope with this challenge,
understand what we have to do to bring our own risk level
led by Hollandes military offensive in Mali (AE 246/27). The
down to an acceptable point.
UK is looking to provide thought leadership, but Camerons
Another executive observed that his companys site used the government has courted controversy by committing some 350
same security protocol as at In Amnas, which was very military personnel to operations in Mali and its neighbours in

AFRICAN ENERGY ISSUE 247 31 JANUARY 2013 5


Focus

an operation that a number of Whitehall sources told African


Energy was being driven by Camerons office. The In Amnas attack
The US initially offered little more than moral support for the The attack on the BP/Statoil/Sonatrach associations gas production
facility was carried out by Al-Mouakioune Bi Dam (Those who Sign
French intervention, but is now talking about siting drone
in Blood), led by Sahel-based jihadist Abdelhakim Al-Nigeri, whose
aircraft in the region possibly in Niger to pursue AQIM as commander (not present) was the veteran Algerian-born Islamist
it has pursued jihadists in Afghanistan, Pakistan and Yemen. guerrilla leader, kidnapper and trafficker Mokhtar Belmokhtar.
Outgoing secretary of state Hillary Clinton was quick to More than 830 people were working at the In Amnas complex on 16
promote moves that broaden and deepen our counter-terror January; most were liberated during the militarys first assault the
co-operation going forward with Algeria, and pointed to the following day. A total of 685 Algerian and 107 foreign hostages were
freed by 19 January after what Statoil head Helge Lund called the
flow of arms from, and instability in, Libya as a significant
worst attack on Statoil and the oil and gas industry in living memory.
element.
All these workers were employed either directly by the joint venture or
Despite the robust performance of the Algerian army and its partners, or by contractors, including the Tigentourine expansion
gendarmerie, partner governments are wondering just how projects main contractor, Japans JGC Corporation. Other firms with
a big presence include French catering company CIS Catering Rgis
sound Algiers is as a partner. Although Cameron and other Arnoux, and Algero-British security joint venture Algerian Facilities
leaders have decided to align their policy with President Management Company, backed by Algerias RedMed and the UKs
Abdelaziz Bouteflika, questions are being asked about Sterling Facilities Management. BP had 18 employees at the site at
Algerias command and compliance structure. the time of the attack, of whom 14 escaped (two with injuries); the
remaining four were killed. BP said other personnel at the site [were]
Bouteflika was apparently absent as In Amnas crisis unfolded. contracted to the joint venture and other companies, many of whom
African Energy understands he had gone to Geneva for a regular have worked with and for BP for many years. Seventeen Statoil
employees were present when the attack started; four died.
medical check-up. Other senior officials, including prime
minister Abdelmalek Sellal and foreign minister Mourad The largest number of fatalities was recorded by JGC, which on 24
January said it had lost ten Japanese employees, including vice
Medelci, eventually responded to calls, but the crisis was being president Tadanori Aratani, with another four foreign employees still
handled in other power centres, dominated by the unaccounted for. A Sterling spokesman confirmed its personnel were
military/security authorities. Adding to the confusion, is involved, but gave no further details.
speculation about power struggles as Algiers confronts
generational change, with Medienne and other key decision-
makers, as well as Bouteflika, approaching retirement.
African Energy Atlas 2013
Old concerns surrounding the dealings of Algerian jihadists,
led by Belmokhtar, and elements of the security services are A new edition of the African Energy Atlas will be published at the
fuelling the rumour mill. It is widely believed that Belmokhtar end of March. Expanded to 84 pages, the atlas will feature more
who seems to have had dealings with most players active in than 60 maps and charts drawn with expert care by journalist
the Saharan underworld has, at some time, been used as a cartographer David Burles.
DRS asset. The Atlas has become an Africas energy infrastructure
Power Pools:
Maghreb Electricity
Bizerte
ALGIERS Skikda

indispensable resource for all


TUNIS Committee (Comelec)
Arzew West African Power
Tangier Oran Constantine
T UNISIA Pool (WAPP)
Oujda GULF OF GABS
Sada Biskra La Skhira
RABAT Fs Gabs Central African
Casablanca OFFSHORE Power Pool (CAPP)
MOROCCO TRIPOLI NILE DELTA
HASSI Az-Zawiya
A RMEL Misratah Tobruk Eastern Africa

A 2009 US diplomatic cable disclosed by WikiLeaks, described


Marrakech HASSI Benghazi Idku Damietta
MESSAOUD Alexandria
Power Pool (EAPP)
Port Said

energy industry professionals,


B Bchar Marsa
BERKINE Ghadames Ras Lanuf Al-Brega Suez Southern African
Agadir BASIN
WESTERN Sinai Power Pool (SAPP)
ALGERIA DESERT CAIRO Taba
GHADAMES GULF OF SUEZ
BASIN Minya
ILLIZI
Adrar BASIN SIRTE
SAHARA In Salah Sabha BASIN Asyut National boundary
El Ayoun MURZUQ Safaga
FIELDS
BASIN L I B YA EGYPT Major oil/gas areas
Western Luxor
and recent significant
Sahara S a h a r a

policy makers and academics


discoveries

a conversation between Mali-based diplomats and Tuareg


(under UN Al-Kufra C
mandate) Abu
Tamanrasset L. Oil pipeline
Bordj Simbel Nasser Halaib
Mokhtar Gas pipeline
e

Nouadhibou
Nil

Atar
D Port Sudan Major hydroelectric
NOUAKCHOTT M A U R I TA N I A Arlit scheme (see table)
E
MALI

with an interest in the continent.


CHINGUETTI Atbara Power transmission
Timbuktu Agadez
Gao ERITREA line
St-Louis
Nma
N I G E R AGADEM Kassala Massawa

leader Abderahmane ag Ghalla, who said he frequently


PRAIA CHAD KHARTOUM Wad
Nig

DAKAR Kayes ASMARA


S U D A N Medani
er

CAPE SENEGAL NIAMEY Maradi Abch


VERDE BANJUL THE BURKINA Zinder El Fasher Gedaref F Mekele Assab
Q Sgou FASO L.Chad
GAMBIA Sokoto Rabak
DOME FLORE BAMAKO Bobo NDJAMENA L.Tana DJIBOUTI
Dioulasso OUAGADOUGOU Kano FULA JB
BISSAU Maiduguri l ue G H DJIBOUTI
GUINEA-BISSAU R GUINEA NIGERIA Maroua I Nil VILLE Boosaaso
Dire
Kankan Ferkessdougou Tamale BENIN V Kaduna
Dawa Berbera
e

CONAKRY DOBA Sarh


S Jebba ABUJA e MUGLAD MELUT ADDIS Hargeysa
TOGO

FREETOWN CTE Dam u ABABA K Harer Garowe


GHANA en BASIN BASIN
Wh

DIVOIRE Ibadan AjaokutaB

It is essential reading for new


SIERRA LEONE L. Volta Wau L ET HIOPIA
Ngaoundr

queried his Algerian colleagues on Algerias position toward


T Kumasi Te W
ite

VENUS; MERCURY
Lagos Enugu CENTRAL SOUTH
A

m U Malka
CAMEROON AFRICAN REPUBLIC
N i le

a
LI

MONROVIA YAMOUSSOUKRO SUDAN Wakena Dam


PO OV

LIBERIA Port Harcourt Yabelo


N M

BANGUI
LO RA

RTOO

JUBA
M

San-Pedro Douala Dolo Odo


A

SO
CC ATO TANO

U e le
-

FOXTROT X YAOUND
JU

Moyale
DZ E;

Buta
BI

Abidjan NIGER MALABO L.Turkana


LE

DELTA EQUAT.
Kribi Isiro Gulu UGANDA
SO TOM GUINEA Turkwel Dam MOGADISHU
LLE O

L. ALBERT BASIN M
Selected major hydroelectric
AVI NG

KAMPALA K E N YA
& PRNCIPE OKUME
)

Kisangani Bunia

investors in the region and


LIBREVILLE
(BR F CO

N
schemes Existing and future SO TOM
Port-Gentil
Mbandaka
Mbarara
Kisumu Tana
River
Kismayo
AZZ

GA B O N dams
o

OGOOU DELTA
REP. O

D E M O C R AT I C RWANDA
ng

NAME RIVER CAPACITY

Moctar bel Moctar [sic] reportedly asking on several occasions:


Annobn Y Lake NAIROBI
Co

A Afourer Oued Day 463 MW (Eq. Guinea) R E P U B L I C O F L. Kivu O KIGALIMwanza


Victoria
B Abdelmoumen Issen 400 MW Bandundu
C Aswan High Nile 2,100 MW ETAM Pointe-
Noire
C O N G O Bukavu BUJUMBURA SEYCHELLES
D Kajbar Nile 300 MW EMERAUDE; LOANGO BRAZZAVILLE BURUNDI Arusha Mombasa
Z 1 KINSHASA
Kigoma Lake Pemba I. VICTORIA
E Merowe Nile 1,250 MW CABINDA Tanga
Matadi Kananga Tanganyika
F Tekeze Tekeze 300 MW Zanzibar I.

established operators looking to


LOWER CONGO BASIN
G Tana-Beles Beles 460 MW Soyo Mbuji- Kalemie DODOMA
TAN Z A N I A Dar es Salaam
K a sa

Mayi
H Tis Abay Blue Nile II: 80 MW Iringa Mafia I.
I Grand Renaissance Blue Nile 5,250 MW LUANDA Mbeya
P SONGO SONGO
J Roseires Blue Nile 300 MW Kwanza
% of population River dams
Kihansi
dams
Upper Atbara Dams Atbara & Setit 135 MW

Isnt he working for you? Ag Ghalla professed to be as K Koka, Awash II & III Awash 107 MW with access to A N G O L A Kolwezi 2 Mtwara MNAZI BAY
Sumbe Songea COMOROS
L Gilgel Gibe Omo II: 420 MW electricity 2009 Lubumbashi
MALAWI MORONI
III: 1,870 MW Benguela Copperbelt Lake Malawi Antsiranana
Libya 99.8 Kuito Luena (Lake Nyasa) OFFSHORE ROVUMA
Halale-Werabesa Omo 640 MW

expand their operations across


Egypt 99.6 Ndola Pemba BASIN
M Karuma Victoria Nile 60 MW
100% Huambo LILONGWE Lichinga Mayotte
76% Tunisia 99.5
N Bujagali Victoria Nile 250 MW Mauritius 99.4 Menongue ZAMBIA Nacala
(Fr.)
Owen Falls Victoria Nile 380 MW Algeria 99.3 Mongu LUSAKA Blantyre Mahajanga
Morocco 97.0 Namibe Kafue dams 5
O Ruzizi I-IV Ruzizi 500 MW
4 Zambezi Ikopa River
P Stieglers Gorge Rufiji 2,100 MW
Q Manantali Senegal 200 MW 75%
South Africa 75.0 3 Livingstone HARARE
Tete
UE dams
Ghana 60.5 Rundu Q
R Garafiri Konkour 75 MW 51% Quelimane Toamasina
BI

Victoria

confused as everyone else regarding the Algerian governments


Nigeria 50.6
ZIMBABWE
AM

S Bumbuna Rokel 400 MW Falls ANTANANARIVO

Africa.
T Kossou Bandama 180 MW Cameroon 48.7 Tsumeb Maun Beira Mania MAURITIUS
Bulawayo
MOZ

U Akosombo Volta 1,200 MW 50% Cte dIvoire 47.3 Chicamba & River dams PORT LOUIS
26% Botswana 45.4 Orapa Francistown Mavuzi dams MADAGASCAR
V Kainji Niger 800 MW NAMIBIA Ghanzi
W Mambilla Donga 2,600 MW Senegal 42.0 PANDE; Runion
Zimbabwe 41.5 Selebi-Phikwe TEMANE (Fr.)
X Edea Sanaga 224 MW Walvis
Song Loulou Sanaga 335 MW
Rep. of Congo 37.1
Gabon 36.7
Bay WINDHOEK BO T S WA N A TSHWANE/ Toliara
GABORONE PRETORIA Inhambane
Y Grand Poubara Ogoou 160 MW Sudan 35.9
Z Inga Congo I: 350 MW Namibia 34.0 6

Tolanaro
II: 1,424 MW Eritrea 32.0 Johannesburg MAPUTO
(Outputs: I & II are maximums; Keetmanshoop
III & Grand / IV are projections) III: 3,500-4,250 MW
Angola 26.2 Secunda MBABANE

reticence to go after bel Moctars camps in northern Mali


Lderitz Sasolburg
Grand: 40,000-50,000 MW Benin 24.8 SWAZILAND
al
1 Zongo Inkisi II: 160 MW Togo 20.0 nge
Va

25%
Madagascar 19.0
KUDU Ora Kimberley 7 Richards Bay
2 Nzilo Lualaba II: 120 MW 11% Alexander
Zambia 18.8 Bloemfontein Pietermaritzburg
3 Ruacana Cunene 240 MW Bay 8
4 Kariba North & South Zambezi 1,320 MW Source: Ethiopia 17.0
IBHUBESI MASE Durban
Kenya 16.1 RU
5 Cahora Bassa Zambezi 2,075 MW World S O U T H Gariep & LESOTHO
Energy Lesotho 16.0
Vanderkloof dams

Pre-order your copy


Cahora Bassa North Zambezi 800-1,250 MW Outlook Burkina Faso 14.6
AFRICA
Mphanda Nkuwa Zambezi 1,500 MW 2011 Tanzania 13.9
6 Tubatse PS Steelpoort 1,500 MW Mozambique 11.7 Koeberg nuclear East London
D.R. of Congo 11.1 power plant Mossel
7 Ingula PS (Braamhoek) Wilge 1,333 MW Bay
10% & Cape Town Port Elizabeth

[and] he could only conclude that bel Moctar was receiving


Kilburn Mnj. Tugela 1,000 MW under Malawi 9.0
8 Lesotho Highlands Water Project 182 MW Uganda 9.0
BREDASDORP African Energy 2012
BASIN (www.africa-energy.com)

support from certain quarters of the Algerian government The Atlas will be available to subscribers at the discounted rate of 90
Ag Ghalla said he did not believe that Algerian leaders in (normal price 175).
Algiers were fully aware of what Algerian security services in To pre-order your copy, please email helen@cbi-publishing.com
the southern part of the country were up to.

6 AFRICAN ENERGY ISSUE 247 31 JANUARY 2013


Focus

Libya faces new regional security threat


Security alerts in Benghazi and Tripoli in late January have highlighted the extent to which Al-Qaeda may be planning
attacks against Libyan targets, writes John Hamilton

U
ntil now, analyses of Libyan security risk have focused on attacks in Europe and the United States of America.
the large numbers of weapons in circulation and the Disturbingly, the senior leadership of the global Al-Qaeda
central governments inability to impose its authority on movement appears to have specifically targeted Libya in its
unruly local militias, some of which have extreme Islamist long-term planning towards this objective. Quilliam said that
agendas. But, following the In Amnas attack in Algeria, it had obtained information that Al-Qaeda leader Ayman
Tripoli now also has to develop a strategy in partnership with Zawahiri personally designed and supervised the role of Libya
neighbouring governments, including those in Tunis, Algiers within AQIMs strategy.
and Cairo, to combat the emerging threat of regionally Last autumn, Quilliam president and author of the report
orchestrated Al-Qaeda attacks. Noman Benotman, who is a former member of the Libyan
On 28 January, the UK Foreign and Commonwealth Office Islamic Fighting Group and fought with mujahideen in
(FCO) said it was aware of a potential threat to the British Afghanistan, privately warned that western intervention in
embassy in Tripoli and was liaising closely with the Libyan Mali could lead to extreme Islamist groups with bases in the
government. A few days earlier, the FCO had urged British Green Mountains south of the towns of Al-Bayda and Darnah
nationals to leave Benghazi, saying it was now aware of a targeting western hydrocarbons interests in Libya.
specific and imminent threat to westerners. The Dutch and Benotman recently told African Energy that it was not yet clear
German governments followed suit. Although no further whether the recent security threats in Benghazi, Tripoli and
details have been released, a number of sources have said the elsewhere in the country were directly linked to this AQIM
threats included the abduction of a westerner, and an attack on strategy. There are other freelancers operating there with no
an energy facility in the region. Threats to hydrocarbons- particular link to any group, he said, adding that he expected
related targets in other parts of Libya have also been reported. more attacks in Libya. It is an Al-Qaeda strategy to attack
In mid-January, the Italian government shut its Benghazi energy facilities and energy security to provoke the West, he
consulate following an assassination attempt on the consul said.
general.
Some analysts have argued that these threats could come from Security measures
local groups. However, a growing body of evidence suggests The government in Tripoli initially reacted slowly to the In
that extremists from across the region are in communication Amnas attack, which Algerian intelligence says was launched
and may be co-ordinating their actions. On 24 January, the from Libya. African Energy understands that the hostage crisis,
UKs Channel 4 News international editor Lindsey Hilsum just 60km across the border, had been under way for some
quoted Algerian government intelligence sources as saying that hours before reinforcements were sent to strengthen guards
at least two of the In Amnas kidnappers were also involved in already in place at the main south-west fields. These include
the attack on 11 September last year in Benghazi which led to Eni/National Oil Corporation (NOC) joint venture Mellitah
the death of US ambassador Chris Stevens. She also reported Oil and Gas Al-Wafa gas field, which is near the Algerian
rumours that the leader of the Those who Sign in Blood group, border and is the closest Libyan facility to In Amnas.
Mokhtar Belmokhtar, had been seen recruiting in Sirte. Other production facilities in the vicinity are the As-Sharara
and related fields operated by Repsol/NOC joint venture
Salafi-jihadist insurgency Akakus Oil Operations and Mellitahs El-Feel (Elephant) field,
A policy briefing published in late January by the UK-based which are located west and south-west of Awbari. NOC
Quilliam Foundation, a think-tank monitoring radical Islamist subsidiary Arabian Gulf Oil Company operates the El-Hamra
activity, argued that Al-Qaeda in the Islamic Maghreb (AQIM) and Hamada fields in the eastern part of the Ghadames Basin.
has established itself in the Sahel region and hijacked the Tuareg
Security at these fields is officially provided by the Oil
rebellion to transform the area into a space of savagery for its
Installation Protection Force, whose numbers have been doubled
own goal of a Salafi-jihadist insurgency.
to approximately 100 armed personnel. Unlike in Algeria,
The briefing, titled Its a Salafi-Jihadist Insurgency, Stupid, said where the military bases are outside the facilities, these guards
the spread of the group and its ideology across the Sahel- many of whom have been supplied by Zintan-based militia
Sahara region could both destabilise frail regional governments groups are reported to be based within the production plants,
and provide space for AQIM to plan and execute terrorist which may make them more of a deterrent.

AFRICAN ENERGY ISSUE 247 31 JANUARY 2013 7


Power

MOROCCO $329.6m financing of the Takoradi II expansion project. The


financing package was agreed in July 2012 but it has taken time
to meet the conditions precedent required before financial close
Taqa finalises Jorf Lasfar could be reached. In the meantime, low-level construction at
financing the site and the ordering of some materials has been equity
financed. Notice to proceed has now been issued to the
Abu Dhabi National Energy Company (Taqa) said on 28 January engineering, procurement and construction contractors, Japans
it had signed final agreements marking the close of the $1.4bn Mitsui and South Koreas Kepco, which were awarded the
project financing for the expansion of the Jorf Lasfar Electricity $260m contract in 2011, and construction is scheduled to take
Company (JLEL) power plant (AE 234/8). JLEL is already the just over two years. First disbursement of the loan package is
largest coal-fired power plant in the Middle East and North expected in early February.
Africa and the first independent power producer in Morocco,
The Netherlands FMO group arranged $212.1m debt,
supplying 40% of the kingdoms electricity output. The
including $40m from FMO itself, $40m from the Luxembourg-
expansion project will increase its capacity by 700MW to
registered Interact Climate Change Facility, $40m from Agence
2,056MW. Work is about 80% complete and the two new units
Franaise de Dveloppements private sector investment arm
are scheduled to be commissioned in December 2013 and April
Proparco, $30m from the ICF Debt Pool, $24.9m from Deutsche
2014.
Investitions- und Entwicklungsgesellschaft, $22.2m from the
The engineering, procurement and construction contract for African Development Bank and $15m from The Emerging Africa
units 5 and 6 was awarded to Japans Mitsui & Co and South Infrastructure Fund. The World Banks International Finance
Koreas Daewoo Engineering & Construction in 2010. Separate Corporation has committed to a package worth $117.5m,
contracts for two coal unloaders and upgrades to the coal downselling $22.2m to the Opec Fund for International
conveyors at the port of Jorf Lasfar were awarded to Swedens Development and with $15m funding from the Canada Climate
Cargotec and China Harbour Engineering Company in 2011. Change Programme (AE 236/8).
Construction work began in September 2010, with Taqa
The Takoradi II expansion is being developed by Takoradi
providing interim funding. The lenders are financing some 75%
International Company (Tico), which is 90% owned by Taqa and
of the total project costs while Taqa is committing $400m of 10% by theVRA. The expansion will see the 220MW Takoradi
equity funding. The 16-year, multi-currency non-recourse debt, II single-cycle gas power plant converted to a combined-cycle
maturing in 2028, represents the equivalent of $1.3bn. Working facility with the addition of a steam turbine. This will increase
capital and VAT facilities amount to $100m equivalent. This is installed capacity to 330MW without requiring more fuel.
the largest international project financing in Morocco in over a Takoradi II is currently operated by a wholly owned subsidiary
decade and the first time Japanese and Korean export credit of Abu Dhabi-based Taqa Generation International Operating
agencies have participated in Moroccan project finance,Taqa said. Company. The 132MW Takoradi III power plant which had
Banque Centrale Populaire, BNP Paribas, Socit Gnrale and been expected to commission late last year has been delayed by
Standard Chartered Bank are the mandated lead arrangers for the Ghanas elections but will begin operating soon.
credit facilities. The Japan Bank for International Co-operation,
Nippon Export and Investment Insurance and Export-Import Bank BOTSWANA
of Korea are providing direct loans and loan guarantees for more
than 50% of the total project debt.
BPC and Eskom agree new deal
Taqas commitment to meet Moroccos energy needs was not
Botswana Power Corporation (BPC) has secured a new three-year
conditional on financing, as the project is already 80% complete.
agreement with Eskom to supply the countrys faltering power
But this financing shows that, for the right deal with the right
system. Frequent blackouts continue as delays commissioning
structure, significant non-recourse funds can be attracted to the
the 600MW Morupule B coincide with the long overdue
Middle East and North Africa at competitive rates, said Taqa
refurbishment of Morupule A and the end of Botswanas
vice chairman Abdulla Saif Al-Nuaimi.
previous power import agreement with Eskom. The new deal
will see Botswana receive 100MW on a firm basis with a further
GHANA 200MW available on a non-firm basis until 31 July, when
Morupule B is expected to be fully commissioned.
Takoradi II reaches financial BPC chief executive Jacob Raleru told reporters in December
close that Morupule Bs first unit was fully commissioned and
supplying the grid, while Unit 2 had passed construction tests.
Abu Dhabi National Energy Company (Taqa) and Ghanas state- Unit 3 underwent a 15-day reliability run in October but had
owned Volta River Authority (VRA) have completed the not been through performance testing. Unit 4 was still being

8 AFRICAN ENERGY ISSUE 247 31 JANUARY 2013


Power

built. There have been delays to the project following several throughout the supply chain in South Africa. Engineering
deaths on the construction site (AE 234/12). Raleru said consultancy Mott MacDonald announced on 17 January that it
Morupule A was scheduled to resume operations at 60MW had been appointed owners engineer for the 67MW Hopefield
capacity in 2014. BPC will require an additional 300MW wind farm in the Western Cape. The project is being developed
generation capacity by 2017 to avoid load-shedding. by Umoya Energy, owned largely by funds managed by African
Infrastructure Investment Managers Ltd, itself established by a joint
The utility faces further negotiations later this year as a three-year
venture of Macquarie Group of Australia and Old Mutual
50MW power purchase agreement with Democratic Republic
Investment Group (AE 232/11). Hopefield wind farm will
of Congo expires. Botswana also imports 90MW from
comprise 37 V100 1.8MW Vestas turbines on 2,200 hectares of
Mozambique.
land in Saldanha Bay municipality (AE 243/7). Commissioning
is expected in February 2014.
ZAMBIA
US-based solar power developer SunEdison said this month that
construction was under way at its 28MW Soutpan solar PV
First Quantum plans power project, which is being built by Switzerland-based ABB
transmission line to Solwezi (AE 245/8). Soutpan is expected to be commissioned in January
2014. It will use around 100,000 280W crystalline-silicon solar
Copper miner First Quantum Minerals Ltd plans to build a PV panels, which will be guided using locally produced tracking
$230m transmission line from LusakaWest to Solwezi in North- technology. Work is expected to begin imminently at Soutpans
Western Province to supply its new Sentinel mine at Kalumbila. R1.4bn ($155m) sister solar PV project, the 30MW Witkop
The Lusaka Times quoted First Quantum managing director power plant. Local content is estimated at about 40% for both
Matt Pascall as saying that his company was in talks with Zesco the Soutpan and Witkop projects.
over a 330kV transmission line that would cover about 400km. Chinas Trina Solar announced on 29 January that it had been
Pascall said First Quantum had agreed terms with Zesco, which awarded a contract to supply solar PV modules to Spanish
was awaiting the go-ahead from the Zambia Public Procurement engineering, procurement and construction contractor Gestamp
Agency (ZPPA). Solar for the 20MW Prieska and 10MW De Aar projects. The
We are in talks with Zesco for the construction of a power multicrystalline PC05 units will be delivered in Q3 2013. The
transmission line from Lusaka West in Lusaka up to our new units are 15% efficient and have high performance in low light,
mine, Sentinel, here in Solwezi. This will cost at least $230m according to Trina Solar. Prieska and De Aar are owned by the
and is projected to be done by June next year, Pascall said. Its Gestamp Mulilo Consortium, which consists of Gestamp Asetym
really a race against time and we are anxiously waiting for Solar (lead partner, 60%), South Africas Mulilo Renewable
Cyprian Chitundu [Zambia Electricity Supply Company Energy (20%) and the Mulilo Prieska/De Aar Solar Community
(Zesco) managing director] to call us and give us the good news. (black-owned trusts, 20%) (AE 232/13).
Otherwise, we are ready to start. Environmental impact assessments for the third round of the
First Quantum is investing more than $2bn in the Sentinel REIPP procurement programme are due by 28 February, but
project, which will be Africas biggest copper mine with a ever-increasing numbers of European newcomers have their eyes
capacity to produce over 500,000 t/yr of copper concentrate. on future rounds. Germanys Schletter and Spains Grupo Clavijo
have formed a joint venture to develop solar PV power plants in
Pascall said First Quantum was funding the power line to ensure the country. Schletter manufactures PV panel-mounting systems,
supply, and would recoup its investment over five years. The line while Grupo Clavijo specialises in the design, manufacture and
will pass through and tap power from the 120MW Itezhi-Tezhi assembly of solar trackers and structures.
hydropower station, which is under construction, and should
become operational in June 2014. Meanwhile, the state-owned Coega Development Corporation is
working to build South Africas domestic manufacturing capacity
He said Zesco would own the power line after five years, when with a tender for contractors interested in building a R300m
the repayment programme was completed. Half of the money 22,000m2 wind tower manufacturing facility and associated
would be paid as cash and the other half recovered through bills infrastructure in the Coega Industrial Development Zone, Port
for power supplied to the mine. Elizabeth. Bids are due by 11 February. Construction is
scheduled to begin 1 March, with the plant becoming
SOUTH AFRICA operational in November and the first units produced by
December. Administrative buildings are to be completed in
Wind and solar developments February 2014. The plant will have peak capacity of 110 towers
a year and the potential to increase this to 180. It will be owned
The repercussions of the renewable energy independent power and operated by DCD Wind Energy, which manufactures and
producer (REIPP) procurement programme continue to be felt assembles wind turbine components and 50-metre rotor blades

AFRICAN ENERGY ISSUE 247 31 JANUARY 2013 9


Power

at its factory in CapeTown. DCDWind is also involved with the project to the grid. The tender for the latter will close on 22
15MW IsivunguvunguWind Energy Converters project for steel February. The project will use 46 2.3MW turbines and is
manufacturer Saldanha Works, owned by ArcelorMittal. receiving funds from the World Banks Eskom Investment
State utility Eskom continues to play catch-up, with construction Support Project and Clean Technology Fund, together
of its 100MW Sere wind farm in Koekenaap, Western Cape, contributing 32.4% of project costs. A further 36.7% of costs
expected to begin in April. The giant utility is yet to identify a are being covered by the Agence Franaise de Dveloppement and
wind turbine supplier or a contractor to supply and install the 26.8% by the African Development Bank. Sere is expected to
132kV transmission line and substation needed to connect the begin generating in H2 2014.

COUNTRIES AND MARKETS MOROCCO: Prequalification for pumped storage project


Office National de lElectricit et de lEau Potable has published notice
COTE DIVOIRE: Miga backing for Azito
of prequalification for the 350MW Abdelmoumen pumped storage
The World Banks Multilateral Investment Guarantee Agency (Miga) has project in Taroudant Province. The turnkey contract will include
pledged its support for the planned expansion of the Azito thermal implementation studies, civil works, materials and equipment supply,
power plant in Abidjan. The conversion of the existing Azito plant installation, testing and commissioning of the power plant. The facility
from simple-cycle to combined-cycle will bring total capacity to will use two reversible 175MW rated Francis turbines and will have a
430MW, increasing electricity production without additional use of drop of 540 metres with a 36m3/s flow. Abdelmoumen will help
gas. Upon completion, the Azito facility will become the largest reinforce the 460MW Afourer hydroelectric power plant. The work
independent power generator in sub-Saharan Africa. Migas investment will be financed by loans from the European Investment Bank and
guarantee will cover Globeleq Holdings (Azito) Limiteds investment African Development Bank. Bids are due by 29 March.
for up to 20 years against breach of contract by the government of Contact: Office National de lElectricit et de lEau Potable, Branche de
Cte dIvoire. The main $350m loan package reached financial close lElectricit, 65, Rue Othman Ben Affane BP no 13 498 Casablanca 20
late last year with the International Finance Corporation as lead arranger, 000 Maroc.Tel: +212 522 66 82 67/522 66 84 03. Fax: +212 522
and Proparco co-ordinating financing from European development 43 31 15/522 43 31 12.
finance institutions. The West African Development Bank is providing
financing in local currency, while the African Development Bank TUNISIA: New plant to start up in June
announced a $50m senior loan in December (AE 246/8).
A new 200MW power plant at Bir Mechergua built by the US GE is
DR CONGO: Electrification tenders due to start up in June, Tunis Afrique Presse quoted industry minister
Mohamed Lamine Chakhari as saying. With demand growing at least
Socit Nationale dElectricit has issued three tenders for the 8%/yr, GE is working with the state Socit Tunisienne de lElectricit
construction of transmission lines and electrification works forming et du Gaz to help implement an emergency plan to modernise the
part of an African Development Bank-financed electrification project. utilitys facilities and reduce power shortages. Planned large-scale
One tender is for the construction of a 30kV line connecting Kisangani expansion projects have been delayed by political uncertainty following
and Yakusu, as well as electrification works in Yakusu, in Orientale the Arab Spring.
Province. The second is for the construction of the 30kV Bandundu
DimaBendela line along with the electrification of Dima and Bendela UGANDA: Karuma bid hits new hurdle
towns in Bandundu Province. The third is for the extension of medium
The bidding process for the Karuma dam has again been halted, this
and low-voltage networks in Kabare, South Kivu Province. Bids are
time by an intervention from the Inspector General of Government,
due by 5 March.
who has called for a fresh investigation into irregularities. The contract
Contact: Coordonnateur de la CEEP, Socit Nationale dElectricit, Cellule had looked set to be awarded to China International Water & Electric
dExcution des Etudes et Projets CEP, 2381, Avenue de la Justice BP Corporation as the only company remaining in the bidding after two
500, Kinshasa Gombe. Email: snel_dg@yahoo.fr and years of assorted investigations and other delays. The 600MW project
snel_cep.pepur@yahoo.fr. Tel: +243 81 810 36 90. was originally due to be developed by Norways Norpak consortium.
The government now plans to finance it from the state Energy Fund,
ETHIOPIA: UK company plans waste-to-energy plant established in 2007 to provide capital for future schemes. Uganda
Ethiopian Electric Power Corporation and Cambridge Industries Energy brought the delayed Bujagali dam on stream last year but will soon
signed a $120m agreement on 5 January to build a 50MW waste-to- need new capacity to meet growing power demand. The Inspectorate
energy plant in Addis Ababa on a turnkey basis. Described as the first is particularly concerned about the allegation that there is no evidence
of its kind in sub-Saharan Africa, the plant will be fully financed by the of due diligence carried out on the one and only company that is said
Ethiopian government, and aims to provide clean power to the national to have qualified to submit or to have its financial bid evaluated, the
grid and help manage solid waste generated in the city. Cambridge Inspector General, Justice Irene Mulyagonja, said in a statement. The
Industries is also conducting detailed feasibility studies throughout process was halted last year following a tip-off from an anonymous
Ethiopia to recommend future projects in various cities, including Dire official at the Ministry of Mines and Mineral Development citing
Dawa,Adama, Mekelle, Gonder, Bahar Dar, Hawassa and Jimma. irregularities in the procurement process (AE 239/9).

10 AFRICAN ENERGY ISSUE 247 31 JANUARY 2013


Power update

Indian Ocean power update: diversification is key


Political uncertainty and lack of investment have hit development in Madagascar, while Mauritius is quietly
diversifying its energy sources, helped by strong private investor interest. African Energys power update reflects
contrasting fortunes for the Indian Ocean Island states

P
olitical turbulence in Madagascar has hit state water and signed a power purchase agreement in 2008. Local media
electricity utility Jiro sy Rany Malagasy (Jirama), which is reported on 23 January that the environmental impact
starved of investment and struggling to maintain its ailing assessment had finally been awarded. Delays in the coal project
network. The utility faced an angry backlash earlier this month have forced the Central Electricity Board (CEB) to begin the
from residents of the numerous towns and cities affected by redevelopment of the 70MW St Louis diesel power plant to
blackouts, and managed to carry out rehabilitation work on only avoid a generation shortfall in 2014. CEB accounts for around
4km of medium-voltage transmission lines and 39km of low- 40% of electricity generation in Mauritius, using its four thermal
voltage distribution lines in 2012. The situation has become so power plants and nine hydroelectric facilities. The remainder is
serious that the Agence Franaise de Dveloppement is financing purchased from independent power producers, notably coal and
the maintenance of Jiramas power plant. The utility is heavily sugarcane waste plants.
indebted to the government but appears to have postponed
plans to raise equity finance from the private sector. The The French territory of Runion is the site of two ambitious
freezing of European aid in 2009 was a significant blow, but wave power projects. The first to begin operating will be the
work has now resumed at the European-funded 700kW 15MW CETO project being developed by Australias Carnegie
Befanaova hydroelectric power and electrification project, Wave Energy and French companies EDF and defence
which is being built by Italys Zecca Prefabbricati, and there are contractor DCNS. The project will use Carnegies CETO 4
hopes that bigger projects will follow. hydraulic system, which was installed in the sea in May 2012.
Delays putting a buoy in place mean that the project is expected
In a recent appraisal report, the African Development Bank to commission by April, following an inspection of subsea
described Comoros two state-owned electricity companies elements, and will not begin generating power until several
Madji na Mwendje ya Komor and Electricit dAnjouan as being months of testing have been carried out. DCNS ocean thermal
beset by problems relating to governance, internal management energy conversion project is also moving ahead, although a fully
and fraud. The price of electricity in Comoros is high functioning offshore facility will not be constructed for several
compared with neighbouring islands, at 42c/kWh, pushed up years at least. An onshore prototype was moved to the University
by institutional problems and the price of petroleum products of Runion in April 2012 for further studies and technical
used to fuel its thermal power plants via costly long-term training of students to begin. Test results to date have confirmed
contracts. early assumptions about the performance of the generation
Mauritius has been relatively successful in diversifying its module. DCNS is aiming to generate power using the
sources of supply, though a 100MW coal-fired power plant at technology at a cost of 250 ($336)/MWh, the same as
Pointe aux Caves has experienced long delays due to 34c/kWh, which is expensive by the standards of some African
environmental concerns since Malaysian developer CT Power countries but broadly cheaper than diesel power.

COMOROS National utilities have total installed capacity of around 29MW. Known
operating power plants include:
Overview. Madji na Mwendje ya Komor (MA-MWE) manages power and
water in Grand Comore and Mohli, while Electricit dAnjouan manages Mwali and Moroni (6MW). Two diesel generators.
Maharani (100kW). Hydroelectric power plant.
power on Anjouan. Installed capacity is sufficient to meet demand, but system
inefficiencies and poor governance mean frequent power cuts. AE: 246/7.
Miringoni (12kW). Hydroelectric power plant.
Energy Sector Reform and Financial Governance Support Programme.
AfDB sponsored project. World Bank also targeting energy sector governance MADAGASCAR GENERATION
through its budget support programme. Finance: AfDB ($3m grant approved
Dec 2012). AE: 246/7. Overview. Development plans by Jiro sy Rany Malagasy (Jirama) hit by
political instability, which saw donor funding dry up. As well as bigger hydro and
Moroni (18MW). Power project in the pipeline to receive a $41.6m thermal plants, Jirama operates a large number of small thermal generators
concessional credit from Exim Bank of India. supplying towns.
Mohli Island solar. ACP-EU Energy Facility approved grant to MA-MWE
Q1 2011 to establish six mini-grid solar power plants on Mohli Island. MADAGASCAR HYDROELECTRIC
PLANNED
Comoros is believed to have significant geothermal potential, but the
resource has been little studied. Australias Sinclair Knight Merz and New Andekaleka HEP (116MW). Two 29MW turbines operating, powered by
Zealands Gafo Energy are involved with mapping. 50,000m3 capacity dam. Plans to double capacity with two further 29MW

AFRICAN ENERGY ISSUE 247 31 JANUARY 2013 11


Power update

turbines. Sinohydro signed agreement with Jirama Q3 2008 for 29MW third MADAGASCAR THERMAL
turbine, held up by problems raising funds from donors. EIB put 24.5m loan
PLANNED
for installation of fourth turbine on hold in 2009 after suspending all aid to
Madagascar. Finance: Total cost of third and fourth turbine 40.3m. Third Fenerive Est (60MW). China Geo-Engineering Corporation, also known as
turbine finance from OFID, BADEA and Kuwait Fund. $10m IDA credit for Mainland, included a 60MW power plant in plans for an ilmenite mining project
rehabilitation work at existing project. AE: 165/23, 145/11, 144/13, 141/9, in the southern Fenerive Est district. Feasibility study was expected by end-2012.
125/10, 115/10. Demand at the mine expected to peak at around 30MW leaving possibility of
selling to the national grid. Construction not expected to begin for two to three
Volob (56MW). $370,366 USTDA grant part-funded by Paul C Rizzo years and dependent on successful conclusion of EIA. AE: 235/7.
Associates for development study for project to power nickel mine and local grid
in 2005. Study completed 2009, recommends 2x28MW units, $180m capital Sikily. Gas-fired power project being developed by Mocoh ResourcesAmicoh
requirements and 33 months construction timeline. USTDA says project has in collaboration with Jirama. Prefeasibility study completed; feasibility study now
merit, but remains on hold. EDF completed preliminary studies for the Ivondro being considered. Project to be built at Manja, no longer at Tulear. Gas from
River site in 2000. AE: 235/7, 93/25. Amicohs Sikily-1 well.
Ambodiroka (40.5MW). Hydropower project on the Betsiboka River. OPERATING
Chinas CAMC Engineering awarded $143m contract September 2008 to Mandroseza (40MW). Wrtsil built new unit on site of old Antananarivo
construct plant, 200km 220kV and 18km 63kV transmission lines and plant with four 18V38 diesel generating sets, inaugurated February 2008.
substations. Project originally expected to be completed in four years. Jirama Finance: Netherlands grant (51%), ten-year Dutch-guaranteed loan (49%). AE:
conducted feasibility study in 1982. Financed by Chinese government loan. AE: 108/18.
151/11, 146/14.
Toamasina IV (18MW). Thermal plant supplying east coast.
Talviana Falls (15MW). Hydroelectric power plant planned at Talviana Falls
by Swiss cement company Holcim. Will supply the companys Antsirabe plant. Fort Dauphin (23.8MW). Diesel power plant supplying Rio Tintos QMM
Negotiations with government under way. AE: 235/7. ilmenite mineral sands project, with 1.5MW feeding the grid. Contracts:Wrtsil
turnkey contract for six nine-cylinder 32 diesel generating sets, and O&M
Befanaova (700kW). Twin-turbine Sahambano River hydropower unit and contract. AE: 235/7, 138/9, 108/18.
rural electrification project under construction in Ihosy. Being developed by
Ambatovy (18MW). Planned installation of nine 2MW diesel generators
Zecca Prefabbricati (Italy). Project had been postponed due to political
supplying a nickel and cobalt project, owned by Canadas Sherritt International
instability but has now been resumed following an intervention by the EU.
and SNC Lavalin, Japans Sumitomo and Seoul-based Korea Resources
Concession contract signed 9 August 2012. Finance: 2.5m of 3.3m total cost
Corporation. The consortium intends to supply its processing plant, which
to come from ACP-EU Energy Facility. AE: 173/12.
requires 80MW, via three 45MW coal-fired boilers. AE: 235/7.
Antafofo (580MW). Preliminary study carried out by EDF in 2000 for
hydropower site on the northern Ikopa River. AE: 235/7. MAURITIUS THERMAL
Mahavola (300MW). Preliminary study for hydropower site on the Ikopa PLANNED
River carried out by Sethem in 1982. AE: 235/7. CT Power project (100MW). Two-unit coal-fired plant planned at Pointe
Mananara Sud (300MW). Hydro site near Betoafo. Development will aux Caves to be operated by Malaysian company CT Power (Mauritius) as an
depend on whether Rio Tinto Alcan goes ahead developing a bauxite mine in IPP. Long delays due to environmental concerns. Reports that the EIA had been
the Atsimo-Atsinanana area. AE: 235/7. granted in January 2013. AfDB assisting in invitation in June 2012 for EoIs for
transaction advisers to help structure and tender the project.The adviser will also
Sahofika (300MW). Long-term hydroelectric project on the Onive River. assess the existing PPP structure and PPA, which was signed December 2008.A
Preliminary study conducted by PEMC-RI Tana in 1982. AE: 235/7. Ministry of the Environment official was quoted by local media saying that
Antoara (190MW). Jirama carried out preliminary studies in 2000 for hydro construction would begin within six months with commissioning expected in
site on the Tsiribihina River. AE: 235/7. 2014. Equity is held by CT Power (74%) and CEB (26%).

Antetezambato (180MW). Possible hydroelectric site on the Mania River. OPERATING


Preliminary study completed by PEMC-RI Tana in 2000. AE: 235/7. Fort George thermal (138MW). Refurbished after fire in January 2008.
Ampandriambazaha (15MW) and Andranomamofona (15MW). St Louis (70MW) and Nicolay (78MW). CEBs other two thermal power
Hydroelectric sites identified by Jirama on the Mahavavy River, Diana region. plants. Mott MacDonald Ireland Ltd completed EIA for redevelopment of St
Lokoho (4MW). Hydropower plant planned in Sava region. Established as Louis mid-2012 to replace old generators and increase capacity. Redevelopment
necessitated by CT Power coal project delays. St Louis currently comprises six
PPP between Germanys GTZ and private partners e8 a consortium of EDF,
5MW Pielstick generators, commissioned 1978-1981, and three 13MW Wrtsil
RWE and Hydro Quebec and local firm Electricit de Madagascar (EDM).
engines, commissioned in 2006.
Suspended since 2009 due to political situation and now very unlikely to go
ahead.Associated rural electrification programme. Grants from ACP-EU Energy Fort Victoria redevelopment (43MW). Fort Victoria redevelopment
Facility, soft loans from KfW. (43MW). Phase 1: two new 15MW units, commissioned 2010. Phase 2: adding
four new units due to commission in 2013. Mott MacDonald is owners
OPERATING
engineer.
Antelomita II (3.7MW) and Mandraka (24MW) HEPs. Jirama project for
plants rehabilitation. AE: 126/8. MAURITIUS COGENERATION
Sahanivotry HEP (15MW). IPP on stream 2008. Built by Frances Hydlec. Kiscol Bagasse project (18MW). Bagasse project planned by Kwale
Finance: $24m AfDB, local BFV-Socit Gnrale and Mauritius Commercial International Sugar Company Ltd, owned by Kenyan company Pabari
Bank. AE: 235/7, 148/12, 144/13. Investments Ltd and Mauritius Omnicane.

Tsizompaniry (5.2MW). Hydroelectric power plant owned by Henri Fraise Compagnie Thermique de Savannah (87MW). Bagasse cogeneration IPP,
Fils & Cie. Inaugurated in 2008. AE: 235/7. started up April 2007.

Mahitsy (12MW) and Maroantsetra (1.2MW) HEPs. Hydlec developing, Beau Champ bagasse/coal plant (24MW). Started up April 1998 at CIEL
carried out studies at 15m cost. Maroantsetra commissioned August 2010, Group sugarcane plantation.
Mahitsy delayed currently with no known due date. AE: 148/12, 144/13. Centrale Thermique de Belle Vue (70MW). Bagasse/coal cogeneration
Also HEPs operating atToamasina (6.8MW),Antetlometa (3.7MW),Antalaha plant, started up 2000.
(1.9MW), Vatomandry (0.13MW), Fianarantsoa (6.05MW), Maroantsetra FUEL IPP (36MW). Developed by Flacq Union Estates Ltd as islands first
(1.2MW) and Namorona. bagasse/coal plant.

12 AFRICAN ENERGY ISSUE 247 31 JANUARY 2013


Power update

Power generation in the Indian Ocean islands


KENYA 0 Km 80 0 Km 30
Aride Praslin
0 Miles 40 0 Miles 15
Njazidja
Flicit
(Grande Comore) Curieuse VICTORIA
Mombasa Mah
MORONI Anse Volbert
T T Foumbouni Praslin T Amirante
Tanga North
BAIE STE ANNE La Digue
Pemba I. C OMOROS Islands
Platte
MIRINGONI
Mutsamudu Nzwani
(Anjouan)
S E YC HE L L E S
Fomboni FUTURE
Zanzibar I. H Domoni Silhouette POWER LINE? SEYCHELLES
Zanzibar Mwali Frgate
(Mohli) T S VICTORIA Ste Anne
Alphonse
Dzaoudzi T VICTORIA B Cotivy
Dar es W T VICTORIA C (ROCHE CAIMAN) St Franois
Salaam
MAMOUDZOU Mah
Anse Royale
Mayotte
I N D I A N
TA N Z A N I A

(Fr.)
Mafia I.
O C E A N
Songo Songo I.
St Pierre Providence
Aldabra Atoll

FO RT G
Atoll Cap Malheureux

FO
Cosmoledo

RT EO
Atoll

VI RG
ST ORI
NI UIS
CT E

CO
Goodlands

LO A
Assomption Farquhar

LA
Astove BELLE VUE

Y
Atoll
T T T T PLAINE-DES-
Mtwara ROCHES
PORT LOUIS W
a Palma POINTE T
v um
Ru AUX CAVES
Njazidja
(Grande Comore) M A UR I T I US BEAU
MORONI COMOROS Cape
Bobaomby
Quatre Bornes
BIGARA CHAMP
Nzwani les Glorieuses Vacoas Grand River SE
(Anjouan) (Fr.) Antsiranana
(Diego Suarez) Curepipe
T TAMARIND FALLS H W H CHAMPAGNE
Mwali LE VAL H
(Mohli) H Mahbourg
MOZAMBIQUE

TH. DE SUD
MAMOUDZOU BRITANNIA W FERNEY
Pemba Nosy B SAVANNAH
Mayotte T Pointe ST AUBIN
(Fr.) H ANDRANOMAMOFONA Sud Ouest 0 Km 20
H AMPANDRIAMBAZAHA Souillac
0 Miles 10
T Sambava
L

Nacala H
ST-DENIS
E

BEANDRAREZONA H Antalaha W
N

Ste-Suzanne
Moambique Le Port La Possession BOIS ROUGE
H Maroantsetra
N

Mahajanga
T T T S Ga LIGNE DES 400 S St-Andr
An
A

Salazie M t
ton

let

St-Paul
H BRAS DESRIV.
LIANES
s
H

gi

TAKAMAKA DE LEST
lB

Angoche
H Ste-
C

H
ay

Rose
le Juan de Nova
(Fr.)
ISANDRANO H
H AMBODIROKA Nosy Boraha
BELLEVUE I /
MANIRON
R u n i onS W
ANTAFOFO / ANTANANDAVA H St-Leu H (Fr.)
T FENERIVE EST H H BR. D.L. PLAINE PITON DE LA
E

ANDAKANA / VOHITSARA H H BELAVENONA GOL FOURNAISE


os

CHEMIN
T Ambatondrazaka
U

Betsi

Cila

MAHAVOLA H S CANAL LANGEVIN


VOLOB H H T
Ikopa

St-Louis
I Q

boka

Toamasina S SYNDICAT H
RANOMAFANA H H ANDEKALEKA Pierrefonds St-Pierre
MAHITSY H 4 MANDRAKA S ~ St-Philippe
1 ANKARAMAVO / T AMBATOVY ~
B

ANKOTROFOTSY ANTANANARIVO H 4 5 ANTETLOMETA 0 Km 20


AMPEFY H H Vatomandry
M

2 AMBARARATAVOKOKA / TAZOALAVA T H5 0 Miles 10


ANKARAMAINTY Tsiribihina H MANDROSEZA SAHOFIKA / ANDASIROTSAKA
A

3 ANTETEZAMBATO H H Antsirabe H H LOHAVANANA


ANTOARA 1 H H SAHANIVOTRY PORT LOUIS
Z

Morondava 2 H
T 3 Mania H MANANDONA
O

MAD AGASCAR ST-DENIS MAURITIUS


M

H
TSITONGAPIANA H H NAMORONA Runion
Bassas da India
(Fr.)
T Fianarantsoa T (Fr.)
y
Ma ngok
SIKILY
(gas-to-power)
le Europa
(Fr.)
BEFANAOVA H I N D I A N O C E A N
W BETOAFO
Toliara (Tulear) T (MANANARA) H TROPIC OF CAPRICORN

T
Tolanaro
(Fort Dauphin) 0 Kilometres 400
African Energy 2013 Cape Vohimena
(www.africa-energy.com) 0 Miles 200

AFRICAN ENERGY ISSUE 247 31 JANUARY 2013 13


Power update

Compagnie Thermique du Sud (34MW). Coal/bagasse IPP commissioned


2005.
Union St Aubin plant fired by coal and bagasse. Began operation Q3 2005;
Glossary
20-year PPA with CEB signed by CTDS. AE: 108/18.
TERMS
Moin Loisir Sugar Estate (14MW). Bagasse cogeneration facility. CDM Kyoto Protocol Clean Development Mechanism. EIA
Medine (10MW). Bagasse cogeneration power plant. environmental impact assessment. EoI expression of interest. GWh
gigawatt hour. HEP hydroelectric power plant/project. IPP Independent
Mon Desert Alma (11.2MW). Bagasse cogeneration facility. power producer. kV kilovolt. kW kilowatt. kWh kilowatt hour. MoU
memorandum of understanding. MW megawatt. O&M operation and
MAURITIUS RENEWABLES AND WASTE maintenance. PPA power purchase agreement. T&D transmission and
PLANNED distribution.
Solar EoI (10MW). CEB tender for EoI for photovoltaic projects totalling
10MW closed May 2011. COMPANIES AND INSTITUTIONS
Gamma-Conventa (20MW). Waste-to-energy project. AfDB African Development Bank. Badea Arab Bank for Economic
Development in Africa. CEB Central Electricity Board (Mauritius). EIB
Plaine des Roches (18MW). 18x1MW GEV HP wind turbines to produce European Investment Bank. Jirama Jiro Sy Rano Malagasy. KFAED
33GWh/yr for 65,000 homes. Frances Aerowatt Mauritius Ltd submitted EIA Kuwait Fund for Arab Economic Development. KfW Kreditanstalt fur
Q3 2010. Swedish Energy Agency is a project participant. Financial close had Wiederaufbau (Germany). Ofid OPEC Fund for International
been expected this month with commissioning expected H1 2013. Funded from Development. PUC Public Utilities Corporation (Seychelles). USTDA
private sources. CDM registered. AE: 194/10. US Trade and Development Agency.WBG World Bank Group.
Britannia wind (22MW). Aerowatt collaborating with Mauritian sugarcane
and ethanol producer Omnicane. Omnicane undertook preliminary studies in Piton de la Fournaise (15-100MW). Geothermal prospect. Geothermal
February 2009-March 2010, providing positive wind data. AE: 194/10. exploration had been abandoned in 1987 after two unsuccessful wells but is
Bigara wind (25-40MW). CRISIL Risk and Infrastructure Solutions Ltd being reconsidered.
(India) selected as transaction adviser. AE: 148/12.
OPERATING
OPERATING
Bois Rouge (100MW). Coal and bagasse fired cogeneration facility.
Champagne (30MW). Hydroelectric power station commissioned in 1984.
Gol (110MW). Coal and bagasse cogeneration plant.
Mare Chicose landfill gas (3MW). Sotravic. Commissioned Q4 2011.
St Louis (2MW). Biogas facility.
La Nicolirel Feeder Canal IPP (350kW). Small hydroelectric power plant.
Rivire de lEst HEP (67.2MW). In June 2008 EDF awarded contract to
Other hydroelectric power plants are operating at Ferney (10MW), Alstom Hydro to supply 23.7MW Pelton turbine-generator. Delivered and
Tamarind Falls (commissioned 1945, 11.1MW), Le Val (4MW), Rduit installed July 2010. AE: 147/14, 141/10.
(1.2MW), La Ferme (1.2MW), Cascade Cecile (1MW) and Magenta (940kW).
Takamaka I and II (43.4MW). Hydroelectric power station.
REUNION (FRANCE) Other HEPs at Langevin (3.6MW), Bras de la Plaine (2.2MW), Bras des Lianes
PLANNED (2.2MW).
Bellevue I (445kW) and Maniron (220kW). Government invited Wind power facilities operating at Sainte-Rose I (6.3MW), Sainte-Rose
prequalification applications for the planned hydroelectric power plants by (15MW) and Sainte-Suzanne (Arowatt, 10.1MW).
November 2008. Contractors sought for civil works and supply of single Pelton
turbine-generators, other hydromechanical and electromechanical equipment, SEYCHELLES
automation, and remote monitoring. Construction expected to take 18 months Overview. State Public Utilities Corporation is responsible for electricity,
at estimated cost of $2.07m. AE: 147/14.
water and sewerage. Existing grid supplying south-east Mah is overloaded and
OPERATING new developments cannot be connected to the network. Vulnerability of
Le Port (185MW). Diesel power plant. network leads to power trips and shortages. PUC is studying network
reinforcement, as well as conducting feasibility study into underground cable
Port Est (80MW). Thermal power plant. connection between Mah and Praslin islands.
REUNION RENEWABLES Waste-to-energy project (1-4MW). Expected 2013-2014.
PLANNED Victoria (6MW). Wind project expected to begin operating in 2012.
Two planned waste to power projects at Sainte-Suzanne (1.2MW) and Renewable energy development. Government and Abu Dhabis Masdar,
Pierrefonds (5MW). owned by Mubadala Development Corporation, to carry out wind resource
CETO project (15MW). Australias Carnegie Wave Energy, EDF, and French assessment on Mah Island, part of agreement signed January 2009 to develop
marine defence contractor DCNS signed MoU June 2010 for three-stage wave renewable energy in Seychelles. Four wind measurement masts to be installed at
project offshore Runion. Commissioning expected Q1 2013. Manufacture and Inner Harbour, La Misre,Tea Factory and Four Seasons. Projects next phase will
installation managed by DCNS. Equity: Carnegie 49%. EDF 51%. Finance: consist of environmental, technical and commercial feasibility studies to install
French government part funding with $5m grant, EDF Energies Nouvelles wind energy generators. AE: 179/11, 174/14.
50% owned by EDF Group and Runion government also financing. OPERATING
Pelamis Wave Energy Converters (30MW). Wave energy project expected Baie STE Anne (8MW). Diesel power plant on Praslin Island, formerly
to begin operating in 2014. Victoria A.
Ocean Thermal Energy Conversion (1.5MW). Prototype project being Victoria B (19MW). Diesel power plant.
developed by DCNS.
Victoria C, Roche Caiman (32MW). Diesel power plant on Mah using
Sainte-Rose (15.3MW). EDF EN was awarded building permits to develop
seven Wrtsil engines.
two solar PV power plants with 15.3MW combined capacity in 2008. Panels
from Frances Photowatt. Roche Caiman expansion (8MW). PUC plans to add two engines.
Prison du Port (10MW). Solar PV power project. Praslin (2.5MW). Diesel generator. Finance from OFID.

14 AFRICAN ENERGY ISSUE 247 31 JANUARY 2013


Upstream oil and gas

MOROCCO
Elenilto in West African push
Chevron agreements underline Israeli miner Elenilto has expanded its presence in West Africa,
winning the operatorship of Senegals Offshore Sud Shallow Block and
appetite for Atlantic Margin being shortlisted for a phosphate mining licence in Togo.

The 22 January announcement by Chevron Corporation that its The 7,920km2 Senegal block, in which Elenilto is partnered with
Chevron Morocco Exploration Ltd subsidiary had signed Petrosen, has existing 2D seismic, and Elenilto plans to launch a 3D
survey shortly. The company has had a presence in Senegal since
petroleum agreements with the state Office National des
2010 in the hydrocarbons and minerals sectors, and says its
Hydrocarbures et des Mines (Onhym) for three offshore areas operations there are managed by UK-based businessman David
underlines the extent of international oil company (IOC) Ericson of Capital & Investment Management.
enthusiasm for entry into the Moroccan Atlantic Margin
offshore play (AE 242/1). This could be consolidated if market Elenilto is part of Israeli businessman Jacob Engels Russia-focused
real estate company Engelinvest. The company, which has no track
rumours of exploration success in the region by Repsol, Cairn
record in oil exploration but recently acquired a licence in Georgia,
Energy/Longreach/San Leon or another operator are confirmed. was controversially awarded the Western Cluster iron ore concession
Chevron is taking deep-water acreage, which at up to 4,500 in Liberia in 2010 and sold down a 51% stake after an investigation.
metres could significantly expand the scope of exploration by
Onhyms partners. It was among the bidders for Block SL-07A-10 offshore Sierra Leone,
and announced on 15 August it had been awarded a majority stake
Vice chairman George Kirkland welcomed a deal which and the operatorship of the block (AE 238/1). But Israeli-owned
provides Chevron an opportunity to advance our growth Minexco Petroleum, which has offices in London and Gibraltar, said
strategy in frontier basins. In a statement, the US major said it that, on 7 September, it signed a petroleum agreement with the Sierra
would acquire seismic data and conduct studies in the Cap Rhir Leone Petroleum Directorate for the block. Parliament ratified the
agreement on 21 September. Minexcos team includes former Afren
Deep, Cap Cantin Deep and Cap Walidia Deep areas, located
head of exploration Nick Johnson.
over 29,000km2, some 100km-200km offshore west and north-
west of Agadir. The average water depths range from 100 metres Elenilto, in a joint venture with Chinas Wengfu Group, is one of three
to 4,500 metres. Chevron Morocco Exploration has taken a 75% companies shortlisted to develop a phosphate deposit in Togo with an
working interest in the three areas, with Onhym holding the estimated 2bn tonnes of reserves.
rest.
PuraVida said, following the cash payment and approvals, PXP
Other deep-water activity is expected in 2013, with Kosmos
would fund 100% of the costs of various exploration operations,
Energy planning to drill a potentially controversial well in Q4
on its Cap Boujdour permit, which straddles the Moroccan making the deal a maximum of $215m. The carried costs
deep south and disputed Western Sahara. UK-based newcomer include a firm commitment by PXP to fund and drill an
Cairn Energy also plans a deep-water well in Q4 on its Foum exploration well primarily targeting the Toubkal prospect and a
Draa Block. second well targeting a prospect to be agreed. The PXP-funded
carried costs include Onhyms 25% share of exploration costs.
Pura Vidas managing director, Damon Neaves, said that
Plains Exploration enters among the Mazagan joint venture and our nearest neighbours,
Moroccan play we expect at least five exploration wells in the locality of
Mazagan to be drilled in 2014. This represents an
Also moving into Morocco is US minnow Plains Exploration unprecedented investment in exploration offshore Morocco
and Production Company (PXP), which is to pay Australian which will target significant resources and has the potential to
independent Pura Vida Energy $15m upfront for a 52% stake in alter the energy landscape in Morocco. The Toubkal well is
the Magazan deep-water permit. PuraVida, which will use the likely to be drilled in 2014.
funds to finance capital spending, including new work in
Gabon, will retain 23% and Moroccan state Office National des
GHANA
Hydrocarbures et des Mines (Onhym) 25%.
According to Australian Stock Exchange-listed Pura Vida, the
farm-out will provide funding for various exploration
Eni appraises Sankofa discovery
operations up to a maximum of $215m, including a firm Eni has successfully appraised the Sankofa oil discovery on the
commitment to fund and drill two exploration wells. It said Offshore Cape Three Points Block with the Sankofa East 2A
planned drilling would test multiple play types, including the well. The company estimates the overall potential of the Tano
giant Toubkal prospect, which it claims has a mean resource Basin discovery to be around 450m barrels of oil in place, with
potential of 1.5bn bbls. PXP will be appointed operator. recoverable resources of up to 150m barrels, and has begun

AFRICAN ENERGY ISSUE 247 31 JANUARY 2013 15


Upstream oil and gas

planning for commercial development of the oil reserves.


COUNTRIES AND MARKETS
Studies are also under way for the development and
commercialisation of the blocks gas reserves, in line with a GABON: Pura Vida takes Nkembe Block
memorandum of understanding signed last year by Eni and Australias Pura Vida Energy has signed a production-sharing
block partners Vitol and Ghana National Petroleum Corporation contract for the offshore Nkembe Block. It will operate the block
with the Ministry of Energy (AE 238/11). The MoU focuses with an 80% stake, alongside the state of Gabon, with a 20% carried
particularly on the domestic gas market, in which Eni and its interest. The Nkembe Block covers 1,210km2 in water depths of
joint venture partners aim to play a prominent role. 50-500 metres, about 20km off the coast of Gabon, close to several
Development of Ghanas domestic gas infrastructure is lagging producing oil fields. Mitsubishi has a recent discovery in the Batanga
formation in the adjacent block to the north, while Total has
well behind oil, and has been held up by wrangling over
production from the Batanga formation in nearby fields adjacent to
competing priorities for the resource.
the Nkembe Block to the north-east, and Perenco from similar
Eni estimates overall recoverable resources in the block of reservoirs to the east of the block. Pura Vida has acquired existing
approximately 450m barrels of oil equivalent, including gas, well and seismic data on the Nkembe Block, and will also purchase
associated liquids and oil. 845km2 of previously acquired 3D seismic data from WesternGeco.
Pura Vidas founding directors Damon Neaves and David
Sankofa East 2A was drilled 8km south-west of the Sankofa East Ormerod were previously at Tap Oil; Ormerod also spent a year
X1 discovery well and confirmed the extension of the oil managing Sterling Energys Senegal and Guinea Bissau assets.
accumulation in the Cenomanian sequence. The well was
drilled in 990 metres of water and reached a total depth of 4,050
COMPANIES AND PEOPLE
metres, encountering 23 metres of gas and gross condensate pay,
and 76 metres of gross oil pay in Cretaceous sands. WILTON RESOURCES: Khelils advisory role
Just before Eni farmed into the block in September 2009,Vitol Former Algerian energy and mines minister Chakib Khelil, now
announced a gas discovery with the Sankofa-1 well. Sankofa, in private practice with consultancy company Mantral, has joined
which has potential to become the first development of non- Calgary-based Wilton Resources as a senior adviser. The Canadian
associated gas from the Ghana offshore, was followed in 2011 by start-ups ambition is to become a significant international oil and
gas player through the acquisition and development of high-impact
the Gye Name-1 well 16km to the east, which encountered gas
world class assets. It has an Algerian pedigree, as Wiltons founders
and condensates.
led by president Richard Anderson are the managerial team
which used to run First Calgary Petroleums (FCP), a Canadian
NAMIBIA company that benefited enormously from its Algerian dealings
during the decade that Khelil was in office. Wilton presents itself as
Galp farm-in approval paves the successor company to FCP a title that has provoked
considerable comment in Algiers. Wilton has also retained former
way for drilling Nigerian petroleum resources minister and Opec secretary-general
Rilwanu Lukman as an adviser. The two industry veterans
The government has approved the farm-out of a 14% stake in attempted early last year to launch a consultancy group with former
three offshore petroleum exploration licences (PELs) to Iraqi oil minister Issam Chalabi and Libyas former oil minister
Portugals Galp Energia by Brazils HRT Participaes em Shukri Ghanem (AE 230/21). The Chalabi, Ghanem, Khelil &
Lukman Associates venture fell apart when Ghanem died in
Petrleo SA. The farm-out, announced in November, relates to
mysterious circumstances near his residence inVienna last April (AE
PEL 23 in the Walvis Basin and PELs 24 and 28 in the Orange
227/1).
Basin. HRT will remain as operator.
With this formal approval by the government of Namibia, first well, on the Wingat prospect on PEL 23, by the end of Q1.
HRT has fulfilled all the requirements of the farm-out Wingat is located in 1,000 metres of water, and drilling
agreement and we can confirm we will commence operations operations are expected to take about 60 days.
in Q1 2013 for our exploratory campaign in Namibia, said
HRT chief executive Marcio Rocha Mello. SOUTH AFRICA
On 15 January, HRT said the semi-submersible drilling rig
Transocean Marianas had arrived offshore Ghana on its way to
Namibia. The company said the rig would take three weeks to
Thombo Petroleum launches
reach Namibian waters and would then undergo mandatory seismic survey
maintenance for the next 21 days before starting HRTs drilling
Thombo Petroleum has announced the start of 3D seismic
campaign in the Walvis and Orange basins.
acquisition over the A-J1 graben in Block 2B, off the west coast
The Marianas is expected to be on location to start drilling the of South Africa (AE 243/12). The survey, by WesternGeco, aims

16 AFRICAN ENERGY ISSUE 247 31 JANUARY 2013


Upstream & Downstream hydrocarbons and markets

to reveal the extent of the A-J1 oil discovery, drilled by Soekor


in 1988, and to look at other prospects and leads in the graben Aminex loses chief executive
which have been identified from existing 2D seismic data.
Aminex chief executive Stuard Detmer has left the company after 15
The 686km2 survey is due to complete in February. Swedens months to pursue other business interests. Aminex chairman Brian
Crown Energy has an option to acquire Thombo, which has 75% Hall, who had stepped back from the day-to-day running of the
company after Detmers appointment, has returned as executive
in the block alongside Afren, with 25%. Thombo is a privately
chairman, the post he retired from in December 2011.
owned company with South African shareholders. Thombos
directors include Energy Africa founder John Bentley. The company has been frustrated by delays in bringing the Kiliwani
North gas field on line, which have affected cash flow and
development plans for the Ntorya discovery, but Aminex announced an
Kinetiko widens CBM area $8m loan from Argo Capital Management on 17 January. The loan
will provide working capital, particularly for the companys Tanzanian
The Petroleum Agency SA has accepted Kinetiko Energys sixth operations, and the company hopes to repay the loan from proceeds of
technical co-operation permit (TCP) application, for 3,823km2 the sale of its US assets, which is currently under way.
of gassy coalfields east of the Amersfoort project. This increases The company has also launched a farm-out process for its Ruvuma
the Australian companys potential coalbed methane Basin licence, and said on 29 January it had extended the bidding
exploration area to 15,707km2. period for its proposed farm-out at the request of several interested
parties. The bidding process is now likely to be completed in March,
The Amersfoort project (Kinetiko 49%, South Africas Badimo
Aminex said.
Gas 51%) covers an area of 1,601km2 in Mpumalanga, and
Kinetiko now has six TCP applications covering 14,106km2
(Kinetiko 100%) of prospective land, of which four TCPs are 2013. These wells will be followed by two to three more on the
granted and cover 7,890km2. southern licence, following approval by the regulator. The pilot
Three pilot production wells are being drilled on the northern programme will determine gas flow rates and recoverability,
Amersfoort licence, and are scheduled for completion in Q1 from which first gas reserves should be defined by Q2.

Anadarko awards multiple FEED contracts for


Mozambique LNG
Anadarko has awarded FEED contracts for the onshore and offshore elements of its planned liquefaction plant, but
development may not be plain sailing, writes Thalia Griffiths

A
nadarko Petroleum Corporation has awarded multiple procurement, construction, installation and commissioning
contracts to carry out front-end engineering and design contracts.
(FEED) work for the first phase of its planned liquefied
Anadarko, as operator of Offshore Area 1, and Eni, as operator
natural gas (LNG) facility in Cabo Delgado Province. For the
of Offshore Area 4, signed heads of agreement on 21 December
onshore element of the project, Bechtel, CB&Is joint venture
establishing basic principles for the co-ordinated development
(JV) with Chiyoda Corporation, and the Fluor/JGC JV, will all
of their common natural gas reservoirs. PTTEP, which bought
carry out studies for a multi-train liquefaction plant with a
Cove Energy last year, said the agreement was designed to
nominal train capacity of 5m t/yr of LNG, and an overall LNG
facilitate a work programme whereby the two operators will
park plan that will allow for future expansion of the facility to
conduct separate, but co-ordinated offshore development
approximately 50m t/yr.
activities, while jointly planning and constructing common
The offshore installation FEED work will be carried out by onshore liquefaction facilities at Cape Afungi.
Technip, a JV of Subsea 7 and Saipem, and a JV of McDermott
First commercial LNG sales from the facility are planned for
and Allseas, which will come up with a full engineering,
2018, though Rio Tintos $3bn writedown from its
procurement, installation and commissioning plan for the
Mozambique coal project, announced on 17 January, offers a
plants subsea production systems.
timely reminder of the infrastructure challenges of developing
Anadarkos partner PTTEP said that, once the designs and big projects in frontier countries. Rio Tinto bought Australias
estimated costs were submitted, an LNG contractor and Riversdale Mining for $3.7bn in 2011, when other big mining
offshore contractor would be selected for engineering, companies were more cautious about bidding because of

AFRICAN ENERGY ISSUE 247 31 JANUARY 2013 17


Downstream hydrocarbons and markets

concerns about how to export the coal.


COUNTRIES AND MARKETS
In Mozambique, the development of infrastructure to support
the coal assets is more challenging than Rio Tinto originally ALGERIA: Shake-up in Medgaz ownership structure
anticipated. Rio Tinto sought to transport coal by barge along Spanish groups Iberdrola and Endesa (now part of Italys Enel) have
the Zambezi River, but this option did not receive formal found a buyer for their respective 20% and 12% stakes in the Medgaz
approvals, Rio Tinto said in a statement. It said these company that runs the gas pipeline linking north-western Algeria to
infrastructure constraints, combined with a downward revision southern Spain. The Belgian/Canadian Fluxys consortium has
to estimates of recoverable coking coal volumes, had led to a concluded a 233m ($313m) transaction to become the largest
reassessment of the overall scale and ramp-up schedule for the shareholder in Medgazs capital, as the Spanish firms decided to exit
project, but added: Rio Tinto continues to engage with the as part of efforts to curb debt. In early January, Spanish distributor
government of Mozambique on all transport infrastructure Gas Natural Fenosa (GNF) announced it had signed a 61.9m deal
options. with Algerian state company Sonatrach to take a 10% interest in
Rio Tinto said it expected to include a non-cash impairment Medgazs capital. This followed a mid-2012 agreement for
charge of $14bn in its 2012 full-year results on 14 February. Sonatrach to cede part of its 36% stake in Medgaz in exchange for
As well as the $3bn from Rio Tinto Coal Mozambique, this taking a 3.8% interest in GNF. These deals are subject to approval
includes reductions in the carrying values of Rio Tintos by the Medgaz board, and will reduce Sonatrachs stake to 26%.
aluminium assets (mostly Rio Tinto Alcan but also Pacific Fluxys would control 32% of Medgaz, with Spains Cespa holding
Aluminium) in the range of $10bn-$11bn. 20% and Frances GDF Suez 12%.

Chief executive Tom Albanese has stepped down, as has Doug ANGOLA: Trafigura completes Sonangol sale
Ritchie, who led the Mozambique coal acquisition.
Trader Trafigura has completed the sale of a 20% stake of its
Mozambique is often held up by the donor community as an midstream and downstream subsidiary Puma Energy to Angolan
example of successful post-conflict recovery and economic state oil company Sonangol for an undisclosed sum (AE 217/20).
development, but the reality is more nuanced. Since the The agreement announced 29 September 2011, is an important
development of the Pande and Temane gas fields and the Mozal first step in Puma Energys strategy to open up its capital to strategic
aluminium smelter, there has been a significant delay. The and public investors alike,Trafigura said. The companies, through
government has talked up a range of projects, such as the their affiliates Sonagas and DT Holdings, have also agreed to develop
Mphanda Nkuwa hydro project, but there has been little joint investment opportunities in gas and natural gas liquids, and
progress on the ground. their trading. The agreement follows 10% stakes taken by Sonangol
Eni and Anadarko will look closely at Rio Tintos experience as part of Pumas acquisition of BPs downstream assets.
as they co-ordinate on their proposed gas liquefaction project.
COTE DIVOIRE: SIR financing
Many observers assume Mozambique will advance more
rapidly and smoothly than Tanzania, which is less experienced Socit Ivoirienne de Raffinage (SIR) has signed an agreement for a
with foreign investment and less open to foreign investors in $120m structured financing to enable the Abidjan refiner to import
policy terms, but a development on this scale is a huge crude supplies. The financing, signed on 15 January, was led by
challenge for the Mozambican state as well as the companies Banque Atlantique-Cte dIvoire, along with Chaabi International
involved. Bank, a subsidiary of Moroccos Banque Centrale Populaire. The
Ivorian and Moroccan banks are both subsidiaries of holding
BENIN/REGION company Atlantic Business International. Banque Atlantique has
also arranged financings for the 71,000 b/d refinery in previous
years. SIR supplies the domestic market as well as neighbouring
Gasol links with Azeris for LNG countries and energy supplies are a key element in Cte dIvoires

supply efforts to recover from its civil conflict and restore its status as the
biggest economy in the West African franc zone.
Afren affiliate Gasol has signed a strategic alliance agreement
with Azerbaijans Socar Trading SA (STSA) in relation to its Originally launched to export gas from Equatorial Guinea
proposed liquefied natural gas (LNG) import project in Benin. and Nigeria, Gasol is now pursuing a new strategy based on
STSA will supply the LNG for the project and assist Gasol with supplying gas within West Africa. Gasol is 65% owned by
the provision of a floating gas storage and regasification vessel Africa Gas Development Corporation, owned by Liberian
in Cotonou harbour. The project involves the regasification of energy and mining entrepreneur Ethelbert Cooper, who was
LNG to supply power and industrial customers in Benin, Togo also a co-founder of Afren. Another 14.9% is owned by Afren,
and Ghana, replacing supplies promised, but not delivered, by while 20% is traded on Londons Alternative Investment Market
the West African Gas Pipeline (WAGP) (AE 245/19). (AIM).

18 AFRICAN ENERGY ISSUE 247 31 JANUARY 2013


Finance and policy

STSA is the international marketing and development arm of from Afrens oilfields in Nigeria and send that through the
Socar, the state oil company of Azerbaijan. Gasol said the WAGP. But as Afrens gas is unlikely to be available before
strategic alliance would ensure the supply of LNG and the 2017, Gasol is looking to stimulate gas markets in the meantime
storage and regasification vessel on competitive terms. through LNG imports.
Our alliance with STSA represents a major step towards our Gasol has signed a joint venture agreement with Benins Socit
goal of bringing gas to Benin,Togo and Ghana, which remain BenGaz to form a gas marketing company called Cogaz SA.
significantly gas constrained in their power plants and BenGaz has a 2% stake in the WAGP and is owned by Edgar
industries, chief operating officer Alan Buxton said in a Yves Monnou, an influential former foreign minister and
statement. In line with the boards new strategy, the strategic ambassador to Paris. All natural gas to be sold by Cogaz will be
alliance with STSA provides Gasol with access to LNG and a purchased from Gasol or one of its affiliates, and Gasol has a
storage and regasification vessel, but just as importantly, STSAs memorandum of understanding for Cogaz to supply gas to the
experience in the development of such projects. STSAs Benin-Togo Communaut Electrique du Benin (CEB). Currently
expertise and experience will, I am sure, provide significant the only offtakers of WAGP gas are the CEB and Ghanas Volta
assurance to the lenders to our LNG import project.
River Authority, which are not receiving anything like the
The medium-term strategy for Gasol is to take associated gas quantity contracted from Nigerian marketer NGas.

Griffiths Energy guilty of Chad bribery


Griffiths Energy International has been hit with a record fine for paying bribes as part of its efforts to secure
exploration acreage in Chad, after the companys new management uncovered evidence of wrongdoing and
reported it to Canadian police

G
riffiths Energy International has pleaded guilty to bribery was bought by Chinas Sinopec in December 2008. Other new
charges and agreed to pay a record C$10.35m fine related executives and directors followed, and they discovered Griffiths
to its operations in Chad. The Alberta Court of Queen's bribery activities as they prepared for an initial public offering
Bench found that the company had paid US$2m to the wife of (IPO). The company set up a committee to investigate itself
the Chadian ambassador to the United States and Canada as and reported the matter to the Canadian police. The IPO was
part of its efforts to acquire oil and gas properties in Chad. subsequently cancelled (AE 225/16).
According to a statement filed in court, Griffiths Energys late Griffiths Energy regrets the actions of the prior management
founder Brad Griffiths and his business partner Naeem Tyab and board. When we discovered the contracts, we blew the
spent six months in 2008 establishing contacts within Chads whistle and co-operated with the authorities because this is
embassy and inquiring about oil and gas leases there. Griffiths how Griffiths Energys current management and board conduct
died in July 2011 in a boating incident. business, Guidry said in a statement. The negotiated
According to the statement, Griffiths Energys outside legal resolution addresses the interests of all stakeholders. Now that
counsel advised against paying off ambassador Mahamoud the matter is closed, Griffiths Energy can focus all of its
Adam Bechir because he was a government official. Instead, attention on oil exploration, development and production in
Griffiths paid a fee to a company owned by the ambassadors Chad.
wife, handing over a $2m consultancy fee in February 2011. Griffiths said: The company affirms that no influence was
Griffiths Energy signed three production-sharing contracts actually obtained as a result of providing the benefits to the
(PSCs) with the Ndjamena government in 2011; the 2,744km2 foreign public official, and that the award of its production-
Mangara/Badila PSC, which comprises the DOB and DOI sharing contracts was not in any way connected to the
blocks, the 22,206km2 Doseo/Borogop PSC, made up of the improper promises and benefits indirectly provided to the
Doseo and Borogop blocks, and the 826km2 DOH PSC. The foreign public official. These proceedings have no impact on
blocks consist mostly of acreage relinquished by ExxonMobil. the security and veracity of the companys significant licence
The state has a 25% back-in right. area in Chad and the case is now closed.
Once Griffiths obtained the exploration acreage, he appointed The company plans to start development with the Mangara
Gary Guidry as chief executive in July 2011 to bring in the field, to generate short-term cash flow. This would include
necessary oil expertise. Guidry was previously chief executive construction of a 120km pipeline, with anticipated capacity of
of Lundin Group company Tanganyika Oil Company, which 25,000 b/d, to transport production from Mangara to tie in

AFRICAN ENERGY ISSUE 247 31 JANUARY 2013 19


Finance and policy

with the Chad-Cameroon export pipeline.


Tyab brothers influential role
The conviction was brought under the 1999 Corruption of
Foreign Public Officials Act, which Canada has in the past been The names of the Griffiths Energy International co-founders, Naeem
criticised for doing too little to enforce. In March 2011, the and Parvez Tyab, may be familiar to those who follow the sometimes
Organisation for Economic Cooperation and Development shadowy world of Canadian oil minnows operating in Africa. The
criticised limits to the acts jurisdiction, insufficient numbers of other co-founder was the late Canadian financier and businessman
investigators, and weak penalties for convictions. In May 2011, Brad Griffiths, who died in mid-2011. The Tyabs served as directors
until July 2011, when a new board and management were appointed.
Transparency International suggested Canada was a long way
behind other developed countries, identifying it as one of 21 The brothers, along with another sibling, Nasim, have been active on
states undertaking little or no enforcement of their anti- the global investment scene for many years, and Naeem was very
bribery legislation, and the only G7 state in that category. involved in Griffiths Chad deal. According to the Globe and Mail,
which saw the agreed statement of facts filed at the Alberta Court of
Torontos Globe and Mail said the case marked the second Queen's Bench, Naeem Tyab travelled to Chad where Griffiths
conviction for the Royal Canadian Mounted Police (RCMP) Energy eventually secured oil and gas leases. He signed a so-called
since the force established teams dedicated to investigating consulting agreement with Chads ambassador to Canada as part of
foreign corruption. A case against Niko Resources in 2011 saw the firms hunt for oil in Chad. When Griffiths lawyers spiked that
the company pay C$9.5m for bribing former Bangladeshi idea, he signed an identical consulting agreement with a firm owned
energy minister Mosharraf Hossein by providing him with a by the ambassadors wife, according to the court document. When
that document expired, he signed the renewed consulting agreement
vehicle and paying his travel expenses on a trip to Canada and
with the same company, which translated into a $2m bribe, according
the US. to the court filing. The paper noted that it was Naeems Mogul
More recently, the Montreal-based engineering company Energy that was first used to start exploring opportunities in Chad
SNC-Lavalin has said it will look into fresh allegations Parvez Tyab was a director of the former Energy Africa and Elf
contained in a 59-page RCMP affidavit that former company Aquitaine geologist Alain Mizelles Prevail Energy, which in
executives paid some C$160m to late Libyan leader Muammar 2007-08 was awarded a stake in the Republic of Congo Mengo-
Qadhafis son Saadi Qadhafi, currently in hiding in Niger, to Kundji-Bindi project. In 2010, Norwegian company Pan Petroleum
steer contracts in Libya. According to The Globe and Mail, bought Montreal-based Prevails interest in that asset Pan later
which had applied to have the affidavit unsealed,Riadh Ben merged with Norse Energy and is now called Panoro Energy. At the
Aissa did not merely approve of alleged bribes. The former time it was thought Mizelle had brought Tyab who was often
described in the Canadian press as controversial or a controversial
SNC-Lavalin executive masterminded an intricate system for
promoter into Prevail because Tyab was head of the Egypt-focused
rewarding Saadi Qadhafi with more than $160m in bribes in Sea Dragon Energy, which held a stake in Prevail. Indeed, it is
exchange for engineering contracts in Libya, the Royal thought that Naeems Mogul Energy introduced Sea Dragon to Egypt:
Canadian Mounted Police alleges. Some of the payments in February 2007, Sea Dragon settled a claim made by petroleum
were labelled consulting commissions. SNC-Lavalin had a geologist Dr Ghareen Awad, who had sued the company over rights to
C$50m contract to build a new airport in Benghazi, which it an Egyptian oil concession. Awad said he had arranged the farm-out
has now lost. Ben Aissa, who was in charge of the companys of the property to Mogul Energy, which had sold part of its interest to
operations in Libya, is in prison in Switzerland, after being Sea Dragon.
arrested on suspicion of money-laundering and bribery in The third Tyab brother, Nasim, chairs the Vancouver-based Oracle
North Africa. Energy Corporation, at one time heavily involved in Yemen before
turning to operations in Texas and Romania, and more recently to
NIIGERIA Nigeria. In August 2012, Oracle signed a memorandum of
understanding with Nigeria-based Bolad Energy, to participate as
the technical and financial partner in the new marginal field bidding
IFC issues naira bond round expected to be announced by the Nigerian Department of
Petroleum Resources.
The World Banks International Finance Corporation (IFC) has
announced plans to issue a $50m local currency bond Bolad is chaired by Babatunde (Segun) Agboola, a former employee
(equivalent to 8bn naira) to support Nigerias domestic capital of Mobil Producing Nigeria (AE 218/14).
markets and increase access to local currency finance. The IFC
Naija bond will be the corporations first naira-denominated
bond and the first placement by a non-resident issuer in the Bond proceeds will support IFCs private sector development
countrys domestic capital markets. The IFC said the Naija programme.
bond was targeted at investors such as pension funds, insurers,
asset managers and banks wanting to diversify their portfolio Vibrant domestic capital markets are the foundation for lasting
while investing in high-quality assets. IFC bonds are rated growth and, in Africa, they can mobilise capital to close the
triple-A by Moodys Investors Service and Standard & Poors. financing gap for key sectors such as infrastructure and

20 AFRICAN ENERGY ISSUE 247 31 JANUARY 2013


Finance and policy

housing, said IFC vice president and treasurer Jingdong Hua. available funds that can be put to work in the local economy,
said IFC country manager Solomon Adegbie-Quaynor.
Chapel Hill Advisory Partners Limited and Standard Chartered
are lead managers of the transaction. In May 2012, IFC launched its pan-African domestic medium-
term note programme, focusing on Botswana, Ghana, Kenya,
The IFC Naija bond will support the governments efforts to Namibia, Rwanda, South Africa, Uganda and Zambia. IFC
deepen domestic capital markets in Nigeria. It will help pave has also obtained approvals to issue local currency bonds in
the way for other issuers in the domestic markets and makes Kenya.

DEVELOPMENT FINANCE SUDAN: China commits to $1.5bn loan to halt decline


With Khartoums finances in disarray following South Sudans
AfDB: Kaberuka looks forward to Abidjan return
independence (it has lost nearly three-quarters of its crude production,
The African Development Bank Group is expected to receive the which was around 450,000 b/d in H1 2011), China has agreed to
green light from our governors at our annual summit in Marrakesh in provide support. Finance minister Ali Mahmoud said the funds would
May to return to its headquarters in Cte dIvoire after a decade in come from an unidentified Chinese bank, with guarantees from state-
which the exiled multilateral has enjoyed Tunisian hospitality,AfDB controlled China National Petroleum Corporation,to bridge the fiscal
president Donald Kaberuka said in a 17 January speech to ambassadors gap and enhance our balance of payments. Mahmoud told Reuters
based in Tunis. The move will then start in a phased and gradual the loan would help to stem the budget deficit and stabilise the
manner, Kaberuka said. Fundamental for us are security, staff welfare Sudanese pound, which has depreciated sharply.
and business continuity. Ours is a very resilient institution and I assure
you the exercise will be conducted with a high level of professionalism.
CORPORATE FINANCE
AfDB: Bond pricing
On 16 January, the African Development Bank (AfDB) priced a $1bn
MADAGASCAR OIL: Share placing
fixed-rate US dollar global benchmark bond due 15 March 2018. The Madagascar Oil has carried out a share placing and open offer through
transaction pays a coupon of 0.875% and a spread of five basis points London-based natural resources investment bank GMP Securities
over mid-swaps, equivalent to 20.45 basis points over the UST 0.75% Europe to raise 49.5m ($78.4m) at 18p/share. The offering is fully
due 31 December 2017. Joint lead managers are BNP Paribas, underwritten by existing shareholders. GMP is joint bookrunner to
Deutsche Bank, JP Morgan and Nomura. In terms of spreads to the offering, which replaces a financing package announced on 18
Treasuries, this is the tightest ever transaction executed by the Bank December for a $15m short-term loan, plus $45m share subscription
and reflects strong investor demand for top-quality US dollar agreement. Todays announcement sees a pre-emptive issue of
denominated supranational product, the AfDB said. Strong interest common shares to all shareholders that has been demonstrated to be a
from central banks early on helped to create momentum within the considerable improvement on Decembers proposed financing
order book. Main drivers of the transaction were central banks and arrangement and will enable the company to realise the significant
other official institutions at 75%, with asset managers at 10%, banks at potential of its asset base in Madagascar, said GMP vice chairman
9% and corporates at 6%. The geographical distribution was well Simon Catt. Madagascar Oil is preparing to start continuous steam
balanced, with Asia and Americas at 31% and 30%, respectively, injection from the Tsimiroro steam flood pilot project in Q2 2013.
followed by Europe at 20% and the Middle East and Africa at 19%. Laurie Hunter and Mark Weller stepped down as chairman and chief
operating officer in December and were replaced by existing non-
EADB: Equity boost from AfDB executive directors Andrew Morris as non-executive chairman and
The African Development Bank (AfDB) board has approved a $24m Paul Ellis as chief executive.
equity investment in the Kampala-based East African Development
Bank (EADB) to strengthen its balance sheet and help improve its
international credit rating. Of the total, $10m will be paid in with RESOURCES
the balance in the form of callable capital. The AfDB said the
TANZANIA: Barrick raises $142m for gold project
transaction would support capital market development, government
revenue generation and foreign exchange, ultimately stimulating African Barrick Gold (ABG) on 22 January announced the conclusion
economic development and employment opportunities in the region. of negotiations with a commercial banks syndicate led by Standard Bank
EADB member states include Kenya, Rwanda, Uganda and Tanzania. for the provision of a $142m export credit-backed term loan. The
Its activities mainly take the form of loans, leases and equity facility repayable over seven years at a spread of 250 basis points over
participations. The AfDB said the project will help the EADB Libor will be used to expand ABGs Bulyanhulu process plant, with
consolidate the gains of its recent restructuring programme, and the construction of a new carbon-in-leach circuit. Chief executive
strengthen its capital base. This is a crucial condition for mobilizing Greg Hawkins said ABG had sufficient cash to fund the expansion, but
financial resources from capital markets at more affordable terms and what he described as this cost-effective form of project financing
meeting the growing demand for investment in the East African would allow for efficient capital allocation and enhanced returns. The
Community. facility is secured on the project,Tanzanias largest gold scheme.

AFRICAN ENERGY ISSUE 247 31 JANUARY 2013 21


Diar y

2013 20-21 March: Private Equity World Africa, London


Web: www.terrapinn.com
30 Jan-1 February: 4th Annual Anti-Corruption & Compliance
To be held in London. Web: www.ibcfinance.com/event/exportcredit 26-28 March: Cape V, Gabon
Web: http://cape-africa.com
4-5 February: CSP Today South Africa, Pretoria
Web: www.csptoday.com/southafrica/index.php 8-11 April: Power and Electricity World Africa, Johannesburg
Web: www.terrapinn.com
5 February: The Africa Summit, London
Organised by Economist Conferences. Web: www.economistconferences.co.uk 9-11 April: Liberian Mining, Energy & Petroleum Conference
Organised by AME Trade. Web: www.limep.com
6-8 February: East Africa Petroleum Conference & Exhibition
To be held in Tanzania. Web: www.eac.int 15-18 April: Exploration and Commodity Investment, Lusaka
18-21 February: Nigeria Oil & Gas, Abuja Organised by IQPC. Web: www.commoditiesafrica.com

A CWC event. Web: http://cwcnog.com 16-17 April: Botswana Coal and Energy Conference, Gaborone
19-21 February: Africa Energy Indaba, Johannesburg Organisd by IMM Events. Web: www.immevents.com
Web: www.energyindaba.co.za 16-19 April: 17th International Conference & Exhibition on
25-27 February: Gas/LNG as Alternative Resource LNG, Houston
To be held in Johannesburg. Web: http://neo-edge.com/event-line-up A CWC event. Web: www.lng17.org

25-28 February: Energy Process Excellence Africa 22-24 April: 19th Western Africa Oil, Gas & Energy, Windhoek
To be held in Cape Town. Web: http://www.energyprocessexcellence.co.za/ A Global Pacific event. Web: www.petro21.com/events/?id=794

26-28 February: East Mediterranean and North African Gas 23-25 April: Ghana Summit, Accra
Forum, Rome A CWC event. Web: http://cwcghana.com
Web: www.emnagasforum.com
25-26 April: 6th Annual Sub-Saharan Africa Oil Conference
27-28 February: Power Industry North Africa, Morocco To be held in Houston. Web: www.energycorporateafrica.com
Web: www.powerindustry-events.com/redirect.html
14-15 May: Africa Utility Week, Cape Town
27-28 February: Insuring Export Credit & Political Risk, London A Spintelligent event. Web: www.african-utility-week.com
Web: www.iiribcfinance.com/event/exportcredit
14-16 May: Energex Africa 2013: 3rd Intl Exhibition, Gauteng
28 February-1 March: AfroInvest Oil & Gas London 2013 Web: www.exhibitionsafrica.com
Organised by AfroInvest. Web: www.afroinvest2013.com
21-23 May: Angola International Oil and Gas Conference and
11-15 March: Flame 2013, Amsterdam Exhibition, Angola
Web: www.icbi-flame.com/FKN2348AE Web: www.aiogace.com/indexEN.html

12-14 March: Mozambique Gas Summit, Maputo 28-30 May: Uganda Mining, Energy & Oil & Gas
A CWC event. Web: www.mozambique-gas-summit.com An AMETrade event to be held in Kampala. Web: www.umec-uganda.com

12-14 March: World Biofuels Market, Netherlands 18-20 June: Zambian International Mining & Energy
Green Power Conferences. Web: www.worldbiofuelsmarkets.com Organised by AME Trade. Web: www.zimeczambia.com

17-19 March: Power Gen Africa, South Africa 18-20 June: Eastern Africa Oil, Gas & Energy, Nairobi
A PenWell event. Web: www.powergenafrica.com Web: www.petro21.com/events/?id=808

18-20 March: 8th Pipeline Technology Conference, Germany 18-21 June: Africa Energy Forum, Barcelona
Web: www.pipeline-conference.com Web: www.energynet.co.uk/AEF/AEF2013/index.html

19-21 March: Offshore West Africa, Ghana 24-26 June: North Africa Gas Summit, Rome
Organised by Penwell. Web: www.offshorewestafrica.com/index.html Web: www.north-africa-gas.com

22 AFRICAN ENERGY ISSUE 247 31 JANUARY 2013


African Energy view

Morocco pushes security from renewables with new solar tenders


Following its success at drawing in cheap financing and qualified bidders for The projects first phase attracted huge donor interest, allowing it to be
the 160MW first phase of the 500MW Ouarzazate independent power project developed at a very competitive price. Acwa won the bid after it offered a
(IPP), Moroccan Agency for Solar Energy (Masen) has issued significantly lower tariff than its rivals, of $0.0189/kWh; it will still get an
prequalification bids to install another 300MW at the southern site. According acceptable rate of return on this, executives told African Energy. Indeed, the
to prequalification documents for the so-called OZZ CSP Next programme, due Saudi company says that, even without subsidised pricing, it could have
for submission by 25 March, 200MW of this will come from concentrated solar brought in the Ouarzazate phase one job at $0.024/kWh which is competitive
power (CSP) and 100MW will be generated from a tower with storage capacity. for a peaking plant. The latest Morocco IPP bid for a baseload plant the coal-
Mines and energy minister Fouad Douiri says tenders will be issued later in fired Jorf Lasfar Electricity Company units 5 and 6 scheme, for which
2013, for groups to design, finance, build, operate and maintain the units. developer Abu Dhabis Taqa and offtaker ONEE have just reached financial
Bidders already lining up to participate include Alstom and Saudi Arabias close (see Power) came in at $0.013/kWh. Acwa has grown quickly by
Acwa Power International. Meanwhile, Masen is also seeking (by 21 developing projects in Saudi Arabia; its bids for Ouarzazate reflect a proactive
February) a technical consultant for phase two. internationalisation strategy, led by Paddy Padmanathan, who while at Black
& Veatch developed Algerias debut independent water and power project.
CSP is also the preferred technology for the first phase, being developed by a
group led by Acwa, and supported by 25-year power purchase agreements With international business reflecting on the terrorist attacks against Algerian
signed by Masen and state utility Office National de lElectricit et de lEau gas infrastructure, another argument used by Morocco to push the renewables
Potable (ONEE) (AE 240/8). With these ground-breaking schemes, Morocco is agenda is gaining greater substance: that of security. Officials such as Masen
on the way to meeting its plan to generate 2GW from solar power by 2020. head Mustapha Bakkoury and Agence Nationale pour le Dveloppement
According to Douiri, the government plans to tender for a 400MW-500MW solar des Energies Renouvelables et de lEfficacit Energtiques Sad Mouline
project in the Oujda region, by 2014, and other sites have been identified. have highlighted the long-term security, of price and supply, that wind and
solar programmes offer to carbon import-dependent Morocco.
Along with plans to generate at least 2GW from wind by 2020, this is an
ambitious programme, criticised by Moroccan politicians and others who argue The OZZ CSP Next prequalification document sets out objectives, including
that, while renewables are to be welcomed for providing clean energy, they optimising the generation mix while reducing dependency on primary energy
represent a costly long-term investment at a time of pressing short-term needs imports; encouraging the launch of a local renewables manufacturing industry;
and deteriorating domestic and external balances. However, the experience of and establishing the kingdom as the first North African developer of scalable
Ouarzazate so far offers a counter-argument, based on acceptable costs and solar generation. If the pricing is right and the leadership can stick to its long-
strategic concerns, which industry experts say will be even stronger as the cost term view which would span several elections then a Moroccan model may
of equipment falls in years to come. emerge for sustainable, secure energy planning, with renewables at its centre.

AFRICAN ENERGY

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