By Antonio Oburu Ondo, Minister of Hydrocarbons and Mineral Development, Equatorial Guinea
ExxonMobil has concluded its operations in Equatorial Guinea after almost three decades, fulfilling its intention, stated in 2022, to leave when its licenses expired.
The departure of the American giant marks the close of a significant chapter in our Country’s petroleum history — one which brought us into OPEC membership. It also opens a promising new chapter.
ExxonMobil’s Achievements in Equatorial Guinea
ExxonMobil’s presence has done much to benefit our nation’s economy and our people’s quality of life.
Mobil Corporation’s discoveries in Equatorial Guinea in the mid-1990s, followed by Exxon’s acquisition of Mobil, resulted in an unprecedented petroleum boom for the country, with the leading impetus for the escalation coming from Exxon’s Zafiro field.
The boom gave us what Energy Voice termed “one of the highest rates of gross domestic product per capita in Africa.” Along with this tremendous growth in GDP came Equatorial Guinea’s 2017 full OPEC membership, fortifying our status within the industry.
ExxonMobil’s work here has also helped open Equatorial Guinea for investment from other oil and gas majors and independent companies, including Chevron, Marathon Oil, Kosmos Energy, Panoro, EG LNG, Africa Oil Corporation, Trident Energy, etc.
During its tenure in Equatorial Guinea, ExxonMobil emphasized training and employing local residents for existing and future projects. It has long focused on assisting economic growth and improving quality of life in countries where it operates, including our country. For example, ExxonMobil Foundation’s Malaria-fighting initiatives, begun in 2000, have provided funding for research, the delivery of bed nets to prevent mosquito bites, the administration of antimalarial treatments, and the distribution of rapid diagnostic kits. ExxonMobil also supported the Grassroots Soccer program, which delivers a malaria prevention and sports curriculum in Equatorial Guinea.
Nor has ExxonMobil stopped with helping humans. It has provided considerable support for the Bioko Biodiversity Protection Program (BBPP) for more than 15 years. The BBPP brought Drexel University and the National University of Equatorial Guinea together as research partners to protect our wealth of wild animal species, from gorillas to chimpanzees, elephants to leopards.
As part of its BBPP efforts, which include cultural and learning programs, ExxonMobil also funded the creation of the Moka Research Center, the region’s first scientific field station. This facility educates locals about safeguarding indigenous species and hosts students and other visitors, from researchers to eco-tourists.
In short, ExxonMobil leaves a trail of positive impacts to Equatorial Guinea as it departs, plus inspiration for potential future impacts by new industry partners.
Transition of Operations to GEPetrol
The transfer of oilfield assets from Exxon to our national oil company, GEPetrol, as operator, has been a seamless one, with Exxon seeing to the safe transfer for all parties concerned.
The transition marks the beginning of a new and exciting era for GEPetrol and Equatorial Guinea. Having held the position of Managing Director of GEPetrol, I can speak from experience about its capacity to grow the country’s petroleum production.
So, with growth in mind, our national oil company will be moving into a new stage of production and exploration, that shall include the important redevelopment of Zafiro Field. As we do so, we’ll be working with independents like Kosmos Energy, Africa Oil Corp., Panoro Energy, Trident Energy, as well as Chevron and Marathon Oil, EG LNG (liquefied natural gas), to build a world-class hydrocarbon sector.
Not only will we be providing energy to meet international demand, but we will also be meeting the needs of our own population.
The Gas Mega Hub and Our New Petroleum Agenda
Equatorial Guinea’s oil and gas reserves are of an absolute importance.
To access, process, and transport those reserves, we are prioritizing drilling campaigns and the establishment of our offshore Gas Mega Hub (GMH). With the GMH, we gain the ability to move our production to regional and global markets and employ it for our own industries and manufacturing.
The hub’s output can also provide in-country poverty relief and climate improvement — propelling economic growth and providing fuel for clean cooking.
The centerpiece of the GMH is Punta Europa Park on Bioko Island, which features a 3.7 million metric tonnes per annum (MMtpa) LNG plant and a 1.1 MMtpa methanol plant. Gas supply to the park came from Marathon Oil until 2021, when Noble’s gas resources from its Alen field began supplementing it, followed by tail gas from Marathon Alba field in 2023.
I am glad to announce that more supply is on the way. In August of this year, Equatorial Guinea signed a bilateral agreement with Nigeria to jointly construct the Gulf of Guinea Gas Pipeline Project to supply gas feedstock to the GMH.
We have also signed an agreement with Cameroon to jointly develop oil and gas fields along our shared coastal borders. This agreement, too, aims to supply the GMH and help raise Equatorial Guinea’s status as a regional hub for industry infrastructure.
Developments like these under our Mega Hub initiative mean that, as the Africa Energy Chamber has stated, “The country is well on its way to becoming a global oil and gas hub.”
Zafiro Field
As new operator of the highly potential Zafiro field, GEPetrol is pursuing plans to increase the field’s production. Development there is stated to start at the opening of 2025, with three phases to be executed within the year.
Pivotal to this effort will be GEPetrol’s technical services contracts with third parties. The agreements will provide services to onshore support bases; a unit for production, storage, and offloading. Engaging more service companies and financial institutions to improve production in this field, it is process we are already tackling.
Near the Zafiro field, PSCs recently signed an agreement with Chevron for development of previous ExxonMobil holdings — blocks EG-06 and EG-11 — which will also contribute to reinvigorating our country’s hydrocarbons industry.
Making Investment in Hydrocarbons Attractive
The ministry is putting measures in place to boost profitability for investors. A group of fiscal reforms that have taken effect this year include:
A corporate income tax reduction from 35% to 25%
A dividend tax reduction from 25% to 10%
Enhanced security for American investors via improved returns.
We will not stop there. We are committed to reviewing our hydrocarbons laws and regulations implement something that is better and modern. By designing a world-class fiscal regime, we can stabilize the market and attract hydrocarbon investors into the country.
Our domestic processing infrastructure is an added attraction for investors looking for a good ROI.
As we have stated before, the Ministry of Hydrocarbons and Mineral Development will remain “available to all investors, current and potential, in order to continue strengthening confidence in the sector and among its actors. This open-door policy has yielded good results and taken oil and gas blocks out of our shelves. More blocks are to be taken out”.
The government is going to continue being a friend and a facilitator of its investors.
Minister Antonio Oburu Ondo will participate at African Energy Week: Invest in African Energy 2024 – scheduled for 4-8 November in Cape Town.
Distributed by APO Group on behalf of African Energy Chamber.