Equatorial Guinea
New oil discovery offshore Equatorial Guinea

afrol News, 26 March - A New York-based oil exploration company, the Amerada Hess Corporation, has announced yet another discovery of oil offshore Equatorial Guinea, for the first time in rather shallow water. The company has developed into the leader in oil exploration and development in the small Central African dictatorship.

Amerada Hess Corporation yesterday reported that it had made an oil discovery offshore Equatorial Guinea on Block G in the Rio Muni Basin. The discovery, named Elon, "was made by the G-8 well and encountered 157 feet of net oil pay. The well was drilled to a total depth of 5,977 feet in approximately 210 feet of water," the company states.

The G-8 well is located about 15 miles northeast of Amerada Hess' Ceiba Field and 6 miles southeast of the recently announced Akom discovery. "Importantly, the G-8 well has established an extension of the play fairway into the shallower water portion of the Rio Muni Basin," said Brian Maxted, Amerada Hess' executive in charge of West Africa operations.

Amerada Hess has developed into a major player in the Equatoguinean oil boom. The global energy company, engaged in the exploration for and the production, purchase, transportation and sale of crude oil and natural gas, in August 2001 completed the acquisition of ordinary shares of Triton Energy Limited, operating in Equatorial Guinea. Triton basically made its wealth on Equatoguinean oil. Together with its own previous operations in the country, the acquisition of Triton made Amerada Hess one of the most important operators in Equatorial Guinea, if not the most important.

In the end of February, the same company could announce another oil discovery offshore Equatorial Guinea. The discovery on Block G in the Rio Muni Basin, named Akom, was estimated at 162 feet of net oil pay. 

Maxted thus said that "Possible development scenarios are being evaluated for the Okume, Oveng, Ebano and Akom discoveries while exploration drilling continues. The imminent arrival of a third drilling rig, the Sovereign Explorer, will permit us to accelerate our drilling offshore Equatorial Guinea."

Also in November last year, Maxted could announce "a significant discovery" in the Okume oil wells. Maxted said he was "extremely pleased with the success of our Okume appraisal drilling," and called it "another important milestone in the development of Equatorial Guinea's hydrocarbon industry."

The Equatoguinean national economy is booming due the recent start in producing and exporting offshore oil. GDP grew by an incredible 70 percent in 2001, a growth rate that is not expected to be lowered in 2002. With an oil production of 200,000 barrels a day (2001), the country reaches over one tenth of the Nigerian production (1.8 million barrels daily, according to the latest OPEC quota). However, it has only 0.4% of Nigeria's population (450,000 as to Nigeria's 120 million). 

While GDP per capita has risen from an estimated US$ 450 in 1996 to an estimated US$ 2,200 in ten years (2001) after the oil boon started in 1997, the average Equatoguinean citizen has not seen much of the oil revenues. Poverty indicators, except GPD per capita, are unchanged since 1996. Most of the revenues are directed to the ruling elite of the country (no official book-keeping exist) and to foreign oil companies, which have made the gross of investments.

Amerada Hess, for example, owns an 85% working interest in and is the operator of Block G and adjacent Block F of the Ceiba Field, while the government of Equatorial Guinea has a carried 5% interest in the production of the Ceiba Okume, Oveng, Ebano, Akom and Elon fields.

The Equatoguinean opposition has asked foreign companies not to involve themselves in operations based on the natural resources belonging to the Equatoguinean people as long as there exists a government not elected by this people. Several oil companies have avoided Equatorial Guinea for political reasons, but there exist no sanctions against the country. 

Sources: Based on Amerada Hess and afrol archives 

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