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Engen unit signs major E&P deal with Gabon

Feb. 3, 1997

Energy Africa, exploration and production unit of Johannesburg's Engen Ltd., has clinched a deal with Gabon's government to take a slice of the state interest in 28 exploration and production projects. Under the agreements, the government's rights in almost all exploration licenses currently in effect in Gabon, covering more than 80% of the country's onshore and offshore sedimentary basins, will be transferred to a new company.

Under the agreements, the government's rights in almost all exploration licenses currently in effect in Gabon, covering more than 80% of the country's onshore and offshore sedimentary basins, will be transferred to a new company.

Energy Africa Gabon SA, as the new venture will be known, will be owned 25% by Gabon and 75% by a joint venture company owned 50% by Energy Africa and 50% by an African investment group.

Energy Africa has not disclosed the value of the deal, saying only that the company can meet acquisition and projected development costs from existing cash resources.

Development prospects

The new company will have a stake in six potential developments:

40% in three satellites of onshore Rabi Kounga field-Niungo, Moukouti and Ganga-operated by Kelt Gabon SA, a unit of Kelt Energy plc, London, and being studied for development.
20% in Limande offshore discovery, being considered for development by operator Agip Gabon SA.
20% in Ablette and 27.5% in Turnix offshore discoveries, being studied for development by Kelt Gabon.

Exploration licenses

Energy Africa said the venture also has the right to take stakes in the following exploration licenses, in the event of a discovery:

10% in Akoumba and 25% in Kowe, operated by Marathon Oil Co.
40% in Akori, 20% in Apari, 20% in Falaba, 40% in Mikoume, 40% in Mpaga and 40% in Sika, operated by Elf Gabon.
40% in Bam Bam, Ineka, and Kenguerie, operated by Shell Gabon.
10-25% in Chaillu, Meboun, and Mpolo, operated by Occidental Petroleum Corp.
7.5% in Etame, operated by Vaalco Energy Inc., Houston.
10% in Gryphon and Phenix, operated by Amoco Corp.
25% in Migoumbi, operated by Total.
10% in Remboue, operated by Chauvco Resources Ltd., Calgary.
10% in Tolo and Otiti, operated by ARCO.
10% in Mondah Baie, operated by Santa Fe International Holdings Inc.

John Bentley, managing director of Energy Africa, said, "This transaction will ensure that Energy Africa has exposure to most exploration successes in Gabon, and the deepwater licenses in particular hold considerable potential."