Equatorial Guinea announces winners of EG Ronda 2019 bidding round
MALABO, EQUATORIAL GUINEA - Equatorial Guinea’s Ministry of Mines and Hydrocarbons has announced the winners of the 2019 licensing round for its oil, gas and mining acreage.
Officially launched in April, the round received interest from 53 international and national companies, with 17 companies submitting official bids and seven companies awarded concessions for nine blocks.
Block EG-27 (formerly Block R) in the Niger Basin, was awarded to Russian energy multinational Lukoil and GEPetrol. Block EG-23 in the Niger Basin, which hosts the Estaurolita gas discovery, was granted to WalterSmith, Hawtai Energy and GEPetrol. EG-09 in the Duala Basin was awarded to Noble Energy and GEPetrol. In the Rio Muni Basin, EG-18 was awarded to Africa Oil Corporation and GEPetrol; EG-03 to Vaalco Energy, Levene Energy and GEPetrol; EG-04 to Vaalco Energy, Levene Energy and GEPetrol; EG-19 to Vaalco Energy, Levene Energy and GEPetrol; Block P to Vaalco Energy, Levene Energy and GEPetrol; and Block EG-28 to GEPetrol.
“This demonstrates that Equatorial Guinea can attract significant interest of investors in the petroleum community. Hopefully, next year we will attract even more investments to our country,” H.E Gabriel Obiang, remarked.
The Ministry of Mines and Hydrocarbons has also signed a cooperative agreement with Russian geological research company Rosgeo and Venezuelan state-owned oil company PDVSA for the study of prospective onshore mining area on the country’s mainland.
The Ministry aims to sign production sharing contracts as soon as possible to enter into the next phase of negotiation. To work more collaboratively with potential investors, all of the blocks were offered on a drill-or-drop basis, with a reduction of signature bonuses to a minimum of $1 million and elimination of all pre-qualification requirements. The drill-or-drop policy provides each company with an initial two-year period to explore, process seismic data, define well locations, bring in additional investment, if necessary, and begin drilling. Only after this period, in which a company has the opportunity to evaluate and reduce its risk from the data obtained, will the company have to decide whether it wants to proceed with the exploration well or relinquish its license.
Equatorial Guinea’s next licensing round will take place in 2020 and will include a different set of criteria by which to select potential blocks and new acreage on which to bid.