- What Is An Oil Field?
- Description Of An Oil Field
- Oil Fields In Africa
Oil fields also represent the entire Petroleum Industry; however, in order to categorize the Oilfield work more accurately, the petroleum industry is categorized broadly into three categories, i.e., Upstream Midstream and Downstream.
‘Upstream‘ is about extracting oil and natural gas from the ground; ‘midstream‘ is about safely moving them thousands of miles; and ‘downstream‘ is converting these resources into the fuels and finished products we all depend on.
What Is An Oil Field?
Also according to Petropedia, oil fields are land from where crude oil and natural gas is produced. It can extend to multiple miles as hydrocarbon reservoirs generally spread over a large area below the earth’s surface. Multiple oil or gas wells can be drilled in a single Oilfield. Succinctly an Oilfield can be defined as a surface area which is on top of the subsurface accumulated hydrocarbon.
Description Of An Oil Field
Oil fields spread over a large area of land, it holds multiple oil wells drilled or being drilled or newly permitted wells that an E&P organization is about to drill. As so many wells are operational in the Oilfield, it contains an extensive associated infrastructure such as drilling rigs, gathering systems, pipelines, tank batteries, and many more.
In the entire globe there are more than 65,000 Oilfields, both onshore and offshore, the largest ones being the Ghawar Field in Saudi Arabia and the Burgan Field in Kuwait.
Oil fields also represents the entire Petroleum Industry; however, in order to categorize oil fields work more accurately, the petroleum industry is categorized broadly into three categories, i.e., Upstream Midstream and Downstream.
Tens of thousands of oil fields have been discovered. However, the concentration of 94-percent of known reserves is in fewer than 1500 major oil fields. The locations of oil fields have been the origin of past geopolitical conflicts and environmental concerns.
Oil Fields In Africa
The African continent is home to various oil-producing countries & oil fields in the world. Africa accounted for more than 7.9 million barrels per day in 2019, which is about 9.6% of world output. This level of production is down somewhat from the heights of 2005 to 2010 when African production was nearly 10 million barrels per day. The major production declines between 2010 and 2015 were mostly due to lower global oil prices. Output stabilized between 2015 and 2019. However, the coronavirus pandemic and a production dispute between Saudi Arabia and Russia in early 2020 dramatically reduced oil prices. As a result, future levels of oil production in Africa and around the world were highly uncertain as of June 2020.
Natural resources Africa presents the oil-producing countries in Africa.
Nigeria is considered the oil-producing giant of Africa. Nigeria produced more than 1.9 million barrels of oil per day in 2014 to rank as the 11th-largest oil producer in the world. The country produced around 2 million barrels per day between 2015 and 2019 plus having 37 billion barrels of proved crude oil reserves.
Nigeria continues to lead the way as the continent’s biggest producer despite sporadic supply disruptions, aging and insufficiently maintained infrastructure and unplanned economic fluctuations.
The state-owned Nigerian National Petroleum Corporation (NNPC) is responsible for regulating Nigeria’s oil and gas sector, as well as developing its oil and gas assets. The NNPC relies heavily on international oil companies to fund development and provide expertise. Most large onshore oil production operations in the country are operated as joint ventures between the NNPC and private oil firms, with the NNPC as majority owner. Comparatively costly and complicated offshore oil developments are typically organized under production-sharing contracts. The terms of these contracts can be adjusted to provide appropriate incentives to international operators. The largest global oil companies operating in Nigeria include Chevron, Exxon Mobil, Shell, Total, and Eni.
Perhaps one of the most significant of Africa’s oil projects to watch in 2019 is the Bonga Southwest project. Estimated to contain recoverable reserves of nearly one billion barrels of oil and expected to deliver 350,000 b/d the Bonga Southwest and Aparo Oil Fields will be exploited by a spread-moored FPSO with the capacity to handle 225,000 b/d of oil, 270 MMcf/d of gas and have a storage capacity of 2.5 million barrels. Upwards of 44 wells are planned with a 98 kilometre 16-inch gas export pipeline.
With oil and gas exports being the backbone of Nigeria’s economy, the country continues to explore new projects to facilitate this. One major midstream project to watch over the next few years is the Trans-Saharan Gas Pipeline which will provide an outlet for Nigerian gas, allowing it to join export routes from Algeria to Europe exporting between 20bcm and 30 bcm per year. The 4,300-km pipeline will begin in Brass in south Nigeria and pass through Niger to Beni Saf on the Algeria coast, from where gas will be piped to Almeria in Spain and is intended to reduce gas flaring in Nigeria by the equivalent of 250,000 bpd of gas and to contribute to Algeria’s plans to increase gas exports to Europe. Although in the early stages of development, the pipeline is expected to start-up in 2022.
Nigeria has a sizeable nameplate refining capacity of 445,000 b/d that exceeds domestic demand, however despite this the country continues to import petroleum. Why? Because Nigerian refineries typically operate below full capacity due to operational failures, fires and sabotage. To combat this the Nigerian government is planning a series of new refineries. One of the largest of these planned refineries is the Dangote Refinery and Polypropylene Plant situated in the Lekki Free Trade Zone. Once completed in early 2020, the refinery will produce 153,000 b/d of gasoline, 104,000 b/d of diesel, 73,000 b/d of jet fuel, 4,109 b/d of LPG and 12,300 b/d of fuel oil.
Angola is Sub-Saharan Africa’s second largest oil producer behind Nigeria and has a well-established oil and gas industry- particularly its upstream sector which is underpinned by prolific deepwater acreage which was first explored in the 1990s.
Angola produced over 1.4 million barrels of oil per day in 2019, continuing a trend of declining production. Angola was producing around 1.8 million barrels per day in 2015, but output decreased steadily during the rest of the decade. This decline was partly due to a cut that the nation agreed to as a member of the Organization of Petroleum Exporting Countries (OPEC). Angola offers access to abundant offshore and deep-water oil reserves in the South Atlantic. However, the development of these oil resources could be delayed by sharply lower oil prices in 2020.
The Sociedade Nacional de Combustiveis de Angola, also known as Sonangol, is Angola’s state-owned oil company. It historically oversaw virtually all oil and gas development in the country. However, President Lourenço made substantial efforts to form a new independent regulatory organization called Agência Nacional de Hidrocarbonetos e Biocombustìveis (ANHB). Some of the most significant international oil companies that were operating in Angola included BP, Chevron, Exxon Mobil, Total, Statoil, Eni, and China National Offshore Oil Corporation, also known as CNOOC.
Angola’s upstream oil sector is dominated by offshore, deepwater fields. Bengo, Longa, Omal, Zenza, Zenza South, Caporolo, Cubal and Chissonga are examples of these fields that are currently in the process of being developed. Situated within Block 16 these fields cover an area of some 4,900 square kilometres and are situated in depths of 200-1,500 metres, around 100 kilometres from the coast. The development of these fields is being led by Total in collaboration with Sonangol and Ocyan and will involve the use of a tension-leg wellhead platform (TLWP) linked to an FPSO with extensive subsea infrastructure also likely to be deployed.
Despite being Africa’s second largest oil producer Angola current imports around 80% of its fuel due to a lack of domestic refineries. In late 2018 Sonangol announced its ambition to change this situation by pursuing new refinery projects. One of which is the Lobito Refinery (also referred to as ‘Sonaref’). The refinery is planned to have a capacity of 200,000 b/d and will process heavy crude from the Kuito and Delta fields. Once operations commence in 2022 the refinery will process an array of products including premium gasoline, diesel, jet fuel, kerosene and liquefied petroleum gas (LPG).
Although Algeria has experienced political turmoil in recent years, with popular uprisings threatening to topple long-term leader Abdelaziz Bouteflika, it has managed to avoid the revolutions that have affected other nations across the Maghreb. From an energy perspective, Algeria holds much promise. It currently supplies large volumes of natural gas to Europe, with energy exports forming the foundation of the national economy. According to OPEC, Algeria has the 16th largest oil reserves in the world.
Algeria produced approximately 1.3 million barrels of oil per day in 2019 to maintain its position among the top tier of African oil producers. However, production is down substantially since 2005, when Algeria’s output was almost 1.7 million barrels of oil per day. OPEC production cuts and a lack of foreign investment played major parts in the nation’s declining oil output. Algeria also exports substantial amounts of natural gas, most of which go to Europe.
Entreprise Nationale Sonatrach is Algeria’s state-owned oil and gas company. Sonatrach is the largest company in Africa and continues to dominate the oil industry in Algeria. However, lower oil prices led to some reforms in 2019, including a lower tax burden. International oil majors involved in Algerian oil production include BP, Total, and Exxon Mobile.
The Touat Gas Field is a 15,392 square-kilometre block situated in the south west of the country which is estimated to hold gas reserves between 60 billion and 120 billion cubic metres. Once running, the project hopes to reach a peak production of 4.5 billion cubic metres of gas a year. Anticipated to start-up in the first half of this year, the Touat Gas Field project will initially see the construction of a gas-processing plant with a capacity of 500 million cubic feet a day and will also include a link into Sonatrach’s central gas transport grid, via a 100km gas pipeline. A total of 25 gas wells will be drilled in the first phase of development.
Energy exports are an absolutely integral part of Algeria’s economy so it’s no surprise to see several midstream projects being sanctioned. Perhaps the most notable being the Skikda Export Terminal Upgrade. This project will see the Skikda port upgraded with a new LNG jetty to almost double its current capacity of 130,000 cm to allow vessels of up to 220,000 cm to dock at the 4.5 mtpa LNG terminal. Other elements of the upgrade include expansion of the oil export terminal port, to handle tankers ranging between 50,000 and 250,000 tonnes as well as the conversion of the existing Skikda LNG terminal to handle liquid petroleum gas (LPG) and methyl tert-butyl ether (MTBE) exports. The Skikda Export Terminal Upgrade project is expected to start-up in the third quarter of 2020.
Although Algeria launched a refinery modernisation drive more than a decade ago, its downstream industry continues to struggle to meet domestic demand. The Eastern Algeria Phosphate Integrated Complex mega project should change this. The project will see the construction of a phosphate and natural gas integrated complex which will include a concentrating mill, acid plant, fertiliser factory, container terminal operating system and corresponding supporting infrastructure. With a total investment of $10 billion the Eastern Algeria Phosphate Integrated Complex should make a big contribution to Algeria’s downstream sector when it starts-up in 2022.
Egypt is the largest non-OPEC oil producer in Africa and the third-largest natural gas producer on the continent. Despite recent political unrest, it remains a strategically important global energy player- a situation enhanced by its position as a major transit route for oil shipped from the Persian Gulf to Europe and the United States.
Egypt produced about 630,000 barrels of oil per day in 2019, with output remaining remarkably steady. The country became much more stable between 2014 and 2019. Egypt is also the largest oil producer in Africa that was not a member of OPEC. On the other hand, the government’s pro-market reforms reduced subsidies for the oil industry.
Egypt’s state-owned oil company, Egyptian General Petroleum Corporation (EGPC), historically dominated oil production in the country. EGPC partners with several international oil companies in offshore and onshore production operations in Egypt. Eni and BP are major shareholders in offshore Egyptian production assets. Furthermore, the Egyptian government has worked to make the country more attractive to foreign investment. Reforms include reducing subsidies to EGPC and reducing the amount of payments in arrears to international oil companies.
Egypt’s offshore oil fields have attracted international attention, with perhaps the most high-profile projects of late being BP’s West Nile Delta Development. Located around 40km from the coast of Egypt the West Nile Delta development has estimated reserves of around 5 Tcf of gas and 55 million barrels of condensates. The first part of the project focused on the development of the Taurus and Libra fields. The second part of the project was the development of the Giza and Fayoum fields (which have just achieved first gas at the time of writing). The third phase of the project will see the development of the Raven field, with production expected in late 2019.
Like many other African nations energy exports play an important role in Egypt’s economy. As such, Egypt’s Ministry of Petroleum is keen to sanction and progress midstream projects that will help transport oil and gas. One such project is the Tina to New Capital Gas Pipeline which will support the export of natural gas produced at the Zohr gas field. The pipeline will be a 50km, 42-inch gas line with 35 MMcm/d capacity. The Egyptian Natural Gas Company (GASCO) is currently overseeing the project which is expected to be completed in mid-2019.
Egypt’s has the largest refining sector in Africa, however the majority of its refineries are operating at levels lower than capacity due to aging and maintenance issues. The expansion and modernisation of this refining capacity is a priority for Egypt’s leadership and several new large-scale projects are planned. One of which is the Mostorod Refinery project situated in an industrial area 10km north of Cairo. Co-located next to an existing refinery at Mostorod, project will see the construction of a 81,500 b/d vacuum distillation unit, a 39,600 b/d hydrocracker, a 16,700 b/d delayed coker, a 23,600 b/d Diesel hydrotreating unit and a 13,000 b/d catalyst reforming unit. It’s expected that the refinery will be able to produce 2.3 million tonnes of diesel, 600,000 tonnes of jet fuel and 522,000 tonnes of gasoline, in addition to butane gas and naphtha.
As of June 2020, Libya was embroiled in a civil war between the Government of National Accord (GNA) and the Libyan National Army (LNA). International oil companies were active in Libyan oil production before the wars following the overthrow of Muammar Gaddafi. However, the future will remain cloudy until the instability is resolved.
Libya produced almost 1.2 million barrels of oil per day in 2019, up more than 100% since 2016. This fantastic increase was primarily the result of a temporary reduction in armed conflict within the country. Furthermore, Libya was exempt from the 2016 OPEC production cuts because output had already fallen from 1.7 million barrels per day in 2010. Unfortunately, production fell dramatically in early 2020 as the civil war in Libya intensified. Despite its troubles, the country contains the largest proven reserves of oil in Africa.
Although Ghana has traditionally been a smaller oil and gas producer, production is expected to accelerate over the next five years with the start of new offshore projects. Crude exports form an important part of Ghana’s economy, whilst natural gas is predominantly used to fuel the country’s domestic power plants. Ghana’s national oil company is the Ghana National Petroleum Corporation (GNPC) which is responsible for the exploration, development, and distribution of petroleum and which is a partner in all oil and natural gas developments across Ghana.
Ghana’s upstream sector should have a positive 2019 as production continues to grow from offshore fields such as Twenboa-Enyenra-Ntomme (TEN) and Offshore Cape Three Points (OCTP). Average production for the TEN field in 2017 was 56,000 b/d whilst production for the OCTP field is expected to peak this year at 45,000 b/d. Other Ghanaian upstream developments to watch this year are the Teak, Akasa and Mahogany East discoveries where test wells have indicated sizeable reserves. Tullow Ghana in collaboration with Anadarko, GNPC and PetroSA will develop the fields using four production wells which are expected to start-up in 2020.
In order to support the Ghana 1000 Project- a major gas-to-power project which will provide approximately 1,300 MW of combined cycle power generation to Ghana’s western regions- Shell and Endeavor Energy are developing a FSRU, which will have a capacity of 3.5 mtpa. A subsea pipeline will link the FSRU to onshore facilities which will then supply the Ghana 1000 project. It’s expected that the FSRU will start-up sometime in 2020.
Ghana has a relatively small downstream sector with only one refinery- the Tema Oil Refinery (TOR), which has a design capacity of 45,000 b/d. In order to boost the country’s refinery throughput, plans have been made to construct a new refinery at Takoradi. The Takoradi New Oil Refinery will process 150,000 barrels of crude oil a day with an annual capacity of 7.5 mtpa. Although the project is at planning stage, the Ghanaian government is aiming for a start-up date in 2022.
Ever since substantial natural gas reserves were discovered in Mozambique’s Rovuma basin (upwards of 100 trillion cubic feet of proven reserves), the country has been the darling of the international oil and gas industry with many analysts suggesting that it could become a key LNG exporter. Although the country’s current domestic oil and gas industry is limited, expect this to develop rapidly.
With the Rovuma basin offering such huge natural gas reserves, Mozambique is expected to experience intense upstream production activity over the coming decade. One of the most notable upstream projects is the Offshore Area 4 Coral Field Upstream Development which will develop the block’s estimated 7 to 10 Tcf of gas. The development plan will involve the use of a FLNG vessel to exploit the gas reserves at the block, as well as extensive subsea infrastructure.
With so much natural gas soon to be available, it’s no surprise to see Mozambique exploring a plethora of midstream LNG projects. The Mozambique LNG Project is one of the biggest and will involve the construction of an LNG plant fed by the offshore Golfinho field and Mamba-Prosperidade complex. Facilities to be constructed include two trains, each with a capacity of 6 mtpa for a total of 12.8 mtpa, two LNG storage tanks, each with a capacity of 180,000 cubic metres, condensate storage, a multi-berth marine jetty and associated utilities and infrastructure. Start-up of the project is expected to take place in 2024.
At present Mozambique’s downstream sector is effectively non-existent. Currently Mozambique does not produce any crude oil or have any refining capacity and relies on imports to satisfy all of its oil product demand. This should change with the construction of Mozambique’s first refinery. Although very much in the feasibility study stage the Mozambique New Refinery will process crude supplies from the Rovuma basin, Mozambique basin, and imported feedstock from the international market. Although details of the refinery are scant at this stage, it is predicted that the refinery could be up and running by 2024.
Hotly tipped as the ‘next big thing’ following significant deepwater finds, Senegal is seen by many industry analysts as being a ripe location for relatively low-cost LNG clusters. With the Yakkar field containing 15 trillion cubic feet of natural gas, and the Greater Tortue Complex containing massive amounts of natural gas Senegal’s aspirations to become a major hydrocarbon producer could come to fruition in the very near future.
Senegal’s Greater Tortue Complex is arguably what started the firing pistol on the country’s upstream development. With a mean gross resource estimate for the Greater Tortue Complex of more than 15 trillion cubic feet of gas, the field has attracted the attention of BP which will be exploiting the complex with a spread-moored FPSO. It’s expected that start-up of the project will be achieved in 2022.
Linked to the Greater Tortue Complex project above, the Greater Tortue-Ahmeyim FLNG project will consist of two near-shore FLNG vessels that will be located 8km offshore straddling the Mauritania/Senegal maritime border. The FLNGs will be fed solely by the Greater Tortue Complex. Whilst capacity for the two FLNGs has yet to be confirmed it is understood that they will have a combined capacity of at least 2.5 mtpa. We expect to see this project start-up during the first half of 2022.
Senegal’s downstream sector is currently sparse and unsophisticated with the only refinery being the 25 kbpd Mbao refinery built in 1963. With demand for diesel and petroleum expected to more than double in the next 20 years Senegal will need to increase its refining capacity. It is understood that Petrosen (Senegal’s national oil company) has commissioned a study to look into the option of repairing and modernising the existing refinery, and a decision on a new refinery will be based on the outcome of this study.
South Africa has a highly-industrialised, energy intensive economy, however limited proved reserves of oil and natural gas mean it is reliant on imports from Middle Eastern and West African producers. As a result of this, South Africa makes extensive use of its large coal deposits to meet the majority of its energy needs. It is also home to a sophisticated synthetic fuels industry which accounts for nearly all of the country’s domestically produced petroleum. The country’s recent deepwater discovery however, raises the spectre of increased upstream activity for South Africa.
South Africa has small amounts of proved crude oil reserves, and its production levels are very small. According to the Oil & Gas Journal, South Africa’s proved crude oil reserves are about 15 million barrels. However, the deepwater Orange Basin near Namibia is believed to hold substantial oil and natural gas resources. The most pertinent upstream development to note in 2019 however is the discovery at the Brulpadda prospect around 175 kilometres off the southern coast of South Africa. The Brulpadda find is estimated at around 1 billion barrels and is currently being developed by French oil major Total.
With such a large reliance on imports for oil and natural gas, South Africa has a well-developed midstream sector consisting of import and storage terminals. The government is proposing to develop this sector of the country’s energy industry further with construction of a new LPG import and storage terminal at Richards Bay. The terminal will have a storage capacity of 22,600 tonnes and will feature four mounded tanks, each capable of storing more than 5,500 tonnes. The terminal will also be capable of sea-borne re-exports to neighbouring countries.
With South Africa consuming the second-largest amount of petroleum in Africa (behind Egypt), the country has a well-developed downstream sector. Petroleum products are largely derived from South Africa’s domestic refineries and its CTL and GTL plants. As of January 2017, South Africa has a crude oil distillation capacity of 493,000 b/d. Yet, due to ever increasing domestic demand South Africa needs to expand its downstream capacity further still. One such expansion is the Sasol Synfuels Secunda Upgrade. The project will involve several upgrade contracts, including a five-year term agreement, providing the management support, coordination and supply of hot-work resources to undertake off-site prefabrication and on-site welding maintenance work on the existing gas, Tar Phenosolven & Sulphur (TPS) and oxygen plants. The upgrade work is expected to be completed in 2020.
List Of Oil Fields In Africa
|Dalia (oil field)||Angola||1997|
|Zelten oil field||Libya||1956|
Source Credit: Fircroft & Investopedia