Gabon’s new Minister of Oil and Gas HE Sosthène NGUEMA NGUEMA has embarked on an aggressive investment campaign, seeking to attract investment in deepwater exploration opportunities.
The newly appointed Minister of Oil and Gas of Gabon HE Sosthène NGUEMA is shifting its focus to deepwater oil and gas exploration under efforts to bring new projects online and mitigate Central and West African production decline. With 72% of the country’s deepwater acreage unexplored and only 28% developed to date, the country has set plans in motion to revise existing petroleum laws to offer fresh incentives that encourage deepwater exploration and investment.
As the voice of the African energy sector, the African Energy Chamber (AEC) commends the aggressive investment strategy being implemented by the Ministry of Petroleum. In recent months, we have seen an assertive Gabonese Government, through its NOC Gabon Oil, play a stronger role in the ownership, and commercialization of legacy assets with takeovers such as that of Carlyle owned Assala. Now, the shift to deepwater exploration offers new investment prospects for foreign operators. The AEC believes that ongoing regulatory reforms, a focus on deepwater investments and greater collaboration with international oil companies (IOC) will transform Gabon’s oil and gas industry, supporting greater production and the development of a new hub for refined product distribution in Central Africa. We believe that Gabon has a potential to produce close to 1 million barrels of oil per day.
With over two billion barrels of proven oil reserves and significant gas potential, Gabon has set a goal of holding production above 220,000 barrels per day (bpd) for the short to midterm The shift to deepwater exploration stands to play an instrumental part in supporting this goal by unlocking new discoveries across the country’s offshore basins mid to long term. Regulatory reform represents a cornerstone of the country’s exploration strategy, with potential improvements to petroleum legislation set to strengthen the competitiveness of investing in Gabon’s deepwater blocks. In 2019, the country introduced its Hydrocarbons Code. The new government seeks to go even further, recognizing the presence of stiff competition from other offshore destinations globally. The code featured amendments to production sharing contracts (PSC), state profitability and tax, therefore providing a quicker path to profitability for foreign operators. Looking ahead, further revisions of this code stand to support new investment, encouraging deepwater exploration and new forays by global operators.
Major players are already active in Gabon, with ongoing developments underscoring the potential available across Gabon’s offshore blocks. Exploration and production company BW Energy, for example, signed PSCs for exploration blocks Niosi Marin and Guduma Marin in 2024, covering an eight-year exploration period with a two-year extension option. BW Energy and its partner on the block VAALCO Energy have committed to drilling one well as well as carrying out a 3D seismic acquisition campaign. BW Energy also has stakes in the Dussafu license, which features 14 producing wells tied back to a FPSO through a 20km pipeline. Partners on the license include the state-owned Gabon Oil Company (GOC) and Panoro Energy. Independent oil and gas company Perenco spud the Hylia South West discovery in Gabon in early 2024, revealing substantial oil-bearing columns in the Ntchengue Ocean reservoir. Chinese oil firm CNOOC launched wildcat drilling on Blocks BC-9 and BCD-10 in early-2023 on the back of 1.4 billion barrels of recoverable resource potential, with future discoveries set to double Gabonese oil production while de-risking deepwater exploration. Despite these developments, much of Gabon’s deepwater potential remains underexplored, highlighting a strategic opportunity for both active and potential players.
Increased hydrocarbon production in tandem with future deepwater discoveries are expected to support Gabon’s broader goals of creating a regional petroleum hub in Gabon. Strategically positioned on the West coast of Central Africa, Gabon is making strides towards enhancing oil and gas refining, storage and distribution capacity. Major infrastructure projects signal the country’s intention to become a petroleum hub. Notably, Perenco is advancing the development of the Cap Lopez LNG terminal in Gabon, targeting first production by 2026. Situated at the existing Cap Lopez oil terminal, the $2 billion project will introduce a FLNG vessel designed to monetize offshore gas reserves and reduce flaring. The FLNG vessel will feature a production capacity of 700,000 tons of LNG and 25,000 tons of LPG, supported by a storage capacity of 137,000 cubic meters. The project complements the Batanga LPG facility, which came online in December 2023 with a target production capacity of 15,000 tons of LPG annually. Beyond LNG and LPG, Gabon is working towards enhancing refining capacity with plans to expand its sole operating refinery – SOGARA – from 1.2 million tons to 1.5 million tons of crude. This expansion would enable the country to achieve self-sufficiency in refined petroleum products by 2030.
The minister and his team have also prioritized the increase of storage capacity for refined products in the country from currently 60 days to 90 days of consumption in an effort to strengthen energy security and make shortages an element of the past.
“Deepwater exploration and production stands to transform Gabon’s economy, with potential discoveries supporting the development of a new petroleum hub in Central Africa. Through its aggressive investment campaign, commitment to regulatory reform and engagement with IOCs, the Ministry of Petroleum is strengthening the competitiveness of doing business in Gabon,” states Verner Ayukegba, Senior Vice President at the AEC.