The Government of Equatorial Guinea plans to break ground on the landmark Bioko Oil Terminal project before the end of the year, after signing a development and financing deal with Arabian Energy of Saudi Arabia in early May and promoting the project at last month’s AOP conference.
The storage project is of vital importance to Equatorial Guinea and West Africa, with the construction of the $500 million, 1.2 million-cubic-meters facility creating western Africa’s largest distribution hub for petroleum products and crude oil.
Arabian Energy and Equatorial Guinea will coordinate on the development, financing, implementation and construction of the Bioko Oil Terminal and additional partners are lining up to invest, said H.E. Gabriel Mbaga Obiang Lima, the Minister of Mines and Hydrocarbons of Equatorial Guinea. Potential investors include Nigerian independent Oranto Petroleum, which announced an interest in the project in late May.
Equatorial Guinea has already demonstrated a clear ability to attract a diverse range of investment partners and bring innovative projects to fruition. The Punta Europa gas complex, which produces a wide-range of gas products, from LNG to Methanol, is an example of this. Fortuna FLNG, which will be the only deepwater FLNG facility in Africa, is one of only two LNG projects globally expected to reach FID in 2017.
“The Bioko Oil Terminal is a first of its kind storage facility for West Africa and would bring to the region energy security and transport economies of scale and efficiencies like we have never seen before,” said H.E. Gabriel Mbaga Obiang Lima, the Minister of Mines and Hydrocarbons of Equatorial Guinea, in a release. “We welcome the addition of Arabian Energy and look forward to working together to move this project to realization.”
The 22-tank storage facility will be built in two phases. Phase one of the Bioko Oil Terminal will include refined products, while phase two will incorporate crude oil. Similar projects are also gaining speed across Africa, and they can’t come fast enough for the oil and gas storage-starved region.
In South Africa, Oiltanking MOGS Saldanha is constructing an 8.8 million-barrel capacity storage terminal, which is expected to be operational in the second half of 2018. In its final phase, the terminal’s capacity will be expanded to 13.2 million barrels. Backed by Marquard & Bahls, a German company, the project in Saldanha Bay is one of the larger storage projects being undertaken in Africa.
Similarly, Vopak announced this year it is expanding its South African storage facilities, including building a new inland terminal with a capacity of 100,000 cubic meters in Gauteng province, and expanding the Vopak Terminal Durban by 130,000 cubic meters.
Traders like Vitol and Glencore have also expressed an interest in investing further in Africa’s storage space. Even then, however, the number of storage and terminal projects announced in western Africa are few and far between. The Bioko Oil Terminal, with geographic position that serves the Gulf of Guinea and southern coastal nations well, will be key to providing energy security and efficiencies that are much needed for regional producers and traders.