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African Energy - Issue 407 - 16/01/2020

CFA franc to be replaced by eco, but initial change is largely symbolic

The move by the eight-member Union Economique et Monétaire Ouest Africaine (Uemoa) to end its 55-yearold currency union based on the French-guaranteed CFA franc will have a range of consequences for businesses and political relations. The new eco currency, whose creation was formally announced in Abidjan on 21 December by President Alassane Dramane Ouattara and the visiting French president, Emmanuel Macron, includes some major changes, notably ending control over franc zone institutions by the Banque de France and reducing the guarantee of the French state. But it does not yet represent an economic revolution: the eco’s introduction in the Uemoa will be subject to a steady transition, intended to avoid upsets in a region that has made considerable economic progress in the past decade, but remains prone to security concerns and potentially volatile populations.

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African Energy - Issue 406 - 19/12/2019

Competition heats up for Egyptian gas plant privatisations

The Egyptian government is considering a number of options for the sale of three gas-fired power plants built by Siemens between 2015 and 2018 which together added 14.4GW to the grid. A sale may be negotiated bilaterally or via a more time-consuming competitive auction; options include the eventual floating of a minority stake on the Egyptian Stock Exchange. The newly formed Tharaa sovereign wealth fund is already playing a decision-making role and is likely to retain the state’s long-term interest in the plants.

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African Energy - Issue 405 - 05/12/2019

Libya’s NOC defies uncertainty with bold investment plan

National Oil Corporation (NOC) chairman Mustafa Sanalla has unveiled a $60bn five-year investment plan to increase crude oil production from 1.25m b/d now to 2.1m b/d by 2024 and gas output to 3.5 bcf/d. Speaking at the Libyan British Business Council in Tunis on 26 November, he said that LYD15bn ($10.5bn) would come from state budgets and the remaining 80% from strategic investors.

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African Energy - Issue 404 - 21/11/2019

Petroleum bill set for release as South Africa government mulls gas options

Minister of mineral and energy resources Gwede Mantashe said on 7 November the new draft Petroleum Amendment Bill, which is currently before cabinet, would be released for public comment within the next three weeks. The bill was drawn up following criticism of the previous government’s efforts to lump oil and gas with mining in the Mineral and Petroleum Resources Development Act (MPRDA) Amendment Bill (AE 379/12).

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African Energy - Issue 403 - 07/11/2019

The United States’ Millennium Challenge Corporation (MCC) on 23 October withdrew $190m of grant funding to Ghana, the same day the government formally began the process of cancelling a concession agreement between the state-owned Electricity Company of Ghana (ECG) and Power Distribution Services Ghana Ltd (PDS). The cancellation follows controversy over the validity of payment securities provided by PDS as part of the transaction (AE 402/10, 398/15).

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African Energy - Issue 402 - 24/10/2019

Quiet spell in African generation growth continues into Q2

The second quarter of 2019 saw 1.8GW of generation capacity added to the grid in Africa. This was a notable increase on Q1, which saw the slowest growth this decade when compared with quarterly averages from previous years. However, 794MW resulted from a unit coming online at the long-delayed Medupi coal power plant in South Africa, which has been bringing online new units periodically since 2015 and has been under construction since 2007.

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African Energy - Issue 400 - 27/09/2019

Angola launches Namibe Basin bid round as new agency pursues sector reform

Angola has announced details of a forthcoming licensing round offering blocks in the Namibe and Benguela basins. The round is the first outing for the new Agência Nacional de Petróleo, Gás e Biocombustíveis (ANPG), created from splitting Sonangol’s roles as concessionaire and equity holder, and a first test for whether last year’s reforms to the country’s oil and gas laws can attract new licensing interest.

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African Energy - Issue 399 - 12/09/2019

Currency shifts begin to affect business in Côte d’Ivoire and beyond

The postponement of an infill drilling programme to expand production from the offshore Espoir field on Block CI-26 raised concerns in the industry when Canadian Natural Resources (CNR) announced the move in early August. In its Q2 2019 results statement, the Calgary-based operator said the postponement was “due to ongoing discussions with the government” and that the drilling programme would be “cancelled until such time as foreign exchange practices can be clarified”.

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African Energy - Issue 398 - 29/08/2019

Electricity supply boost will light up power struggle in Guinea

As generators hum into action and power cuts intensify during the dry season, it seems hard to believe that providing electricity to the population in Conakry and other urban centres will be a major selling point when, as is widely expected, President Alpha Condé launches his campaign to win a third term in 2020. But the pace of recent generation and transmission projects supports the view of many Conakry residents that ‘power is coming’. This is reflected in an upturn in business for the local agent of Turkish company Arçelik’s Beko brand and other white goods suppliers, offering fridges and other goods to consumers who do not yet have stable electricity supply but expect it to come very soon.

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African Energy - Issue 397 - 25/07/2019

Cautious optimism as Angola brings in wide-ranging energy reforms

There has been material progress reforming Angola’s opaque and nepotistic energy sector over the past year. Considerable work has gone into crafting new power sector regulations, and there have been notable changes to upstream licensing and the role of state oil and gas giant Sonangol, as well as important reforms to the downstream hydrocarbons sector. Investors and analysts canvassed by African Energy were impressed by the extent of the changes, although plenty of problems remain to be resolved.

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African Energy Gulf States Newsletter