American multinational energy corporation Chevron has signed an agreement with the government of Equatorial Guinea for Block EG09 – located in the Douala Basin on the border of Cameroon. The agreement grants Chevron 80% ownership with GEPetrol holding the remaining 20%.
Block EG09, previously explored by South Africa’s PetroSA, has the potential to hold sizeable oil and gas reserves owing to its close proximity to other Blocks where large-scale discoveries have been made. Notably, in August 2019, Noble announced the discovery of oil at the Aseng 6P well in Block 1 – which is already producing and located north of Block EG09. As Chevron takes over exploration, stakeholders are eagerly awaiting results.
Several major finds over the last decade emphasize the potential of the Douala Basin, leading to a number of exploration and production companies demonstrating an interest in key block including EG09. During the country’s 2019 bid licensing round – whereby 7 companies were selected and attributed concessions for 9 blocks – Block EG09 was awarded to Noble Energy and GEPetrol.
Chevron entered the Equatorial Guinean market after the company’s acquisition of Noble Energy for $13 billion in October 2020. By working closely with the government, Chevron will carry out a work program that will lead to the potential development of Block EG09.
“We welcome this agreement as this is a confirmation of the amazing prospects that still exist in Block EG09. With the right exploration game and technology, we believe that Chevron will be successful in delivering hydrocarbons that will further position Equatorial Guinea as a top African producer. We believe in the success of this block. Our government is committed to providing the support needed to deliver successful exploration and unlocking hydrocarbons in this basin,” stated H.E. Gabriel Mbaga Obiang Lima, Minister of Mines and Hydrocarbons, Equatorial Guinea.
Equatorial Guinea, despite being a relatively small country geographically, holds some of the largest oil and gas reserves in Africa – gas reserves are estimated at 1.5 trillion cubic feet while oil reserves are estimated at 1.1 billion barrels. With ambitions to establish the country as a Gas Mega Hub, the government has implemented a series of policy frameworks to incentivize investment and drive development. This agreement serves to enhance this ambition, demonstrating the exploratory potential of the country and the role that hydrocarbons will play in accelerating economic growth.