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Zengas
I've just had a top up of our gas contracts as per the Company website and they total 276 mmscfd.
Whilst accepting that some of these are on a 80% take or pay basis, presumably we have to have sufficient gas at any one time to fulfil any one customer's total requirements ?
Can you please explain to me how this reconciles with the current design capacity of 200 mmscfd.
If Nigeria can increase it's oil exports mainly through oil and with the additional reforms supporting it I can see Naira trading below 1000 against by end of 2024. Any significant refinery surplus which can be exported will bring in US dollars inflow to Nigeria, whilst domestic oil refinery product providing fuel to Nigeria should alleviate dollar import pressure of importing fuel from foreign countries.
Therefore it's highly important for Nigeria to get all it's refinery in full flow this year to export markets whilst also meeting domestic demand.
Some additional significant news on Naira today
https://africa.businessinsider.com/local/markets/nigerias-central-bank-resumes-sale-of-dollars-to-bureau-de-change-operators/z3hdnyd
https://www.bloomberg.com/news/articles/2024-02-27/nigeria-delivers-jumbo-rate-hike-to-aid-its-battered-naira
Trust sorry just seen your question
The 2 trains do 100 mmcf/d ie 200 mmcf/d total design capacity.
One was run at 110-120 on test from memory.
They are both being upgraded to 110 mmcf/d each according to the section in the annual report which gives more detail re pressure etc.
So they should be safely capable of doing 220 mmcf/d instead of the name plate 200 mmcf/d.
I'd need to understand or see the pressure rating explained to fully understand why the increased pressure is needed ?
They can add a modular bolt-on processing train when needed is my understanding so could lift production further when demand/contracts are there.
Dangote Refinery can meet 100% of Nigeria’s demand for refined petroleum products and has a surplus for exports.
The Refinery can also help the naira appreciate against the dollar in a number of ways.
Increased production and export of refined petroleum products can generate foreign exchange earnings for the country, thereby increasing the supply of dollars in the foreign exchange market.
Despite the risks involved in daily operations, the refinery could be a game changer for Nigeria’s economy and currency with proper management and support from the government and stakeholders.
The refinery, which has a capacity of 650,000 barrels per day, is expected to meet 100% of Nigeria’s demand for refined petroleum products and have a surplus for export.
The refinery is also expected to create thousands of jobs, boost fuel supplies across Africa, and generate foreign exchange earnings for Nigeria by exporting 40% of its products.
The refinery is seen as a game-changer for Nigeria’s economy and the downstream petroleum products market in the entire African region.
This is a huge achievement for Nigeria, as it will reduce its dependence on fuel imports and save foreign exchange.
Nigeria’s significant expenditure on fuel imports puts pressure on the demand for foreign currency, particularly the dollar.
By reducing or eliminating the need for fuel imports through the Dangote Refinery’s production, it would reduce the demand for dollars in the importation of fuel. This decreased demand for foreign currency can help strengthen the naira against the dollar.
By exporting excess refined products to other countries, especially in Africa, the refinery will earn foreign exchange for Nigeria and increase its reserves. Increased dollar supply can help stabilize or strengthen the naira, boost the confidence of investors, and strengthen the naira’s value.
As the Dangote Refinery produces more fuel domestically, it would reduce Nigeria’s dependence on imported fuel and conserve foreign exchange reserves.
Higher foreign exchange reserves provide stability and confidence in the currency, which can positively impact the exchange rate. Nigeria’s external reserves are around $35 billion, representing 6 months of imports only.
The opportunity cost of subsidizing petroleum products, which includes loss of export revenue, will be gained thus boosting external reserves.
This decreased dependence on imports can help mitigate the impact of imported inflation, as the prices of locally produced petroleum products would be less influenced by global market dynamics.
Additionally, by eliminating the costs associated with importation, such as shipping, customs duties, and other related expenses, the overall cost of fuel consumption for Nigerians could potentially decrease.
https://nairametrics.com/2023/05/23/how-dangote-refinery-can-strengthen-the-exchange-rate/
Huge news considering Nigeria spends $30b on fuel imports and should greatly improve the dollar liquidity.
Exclusive: Nigeria's new Dangote refinery to export first fuel cargoes
LONDON/BRUSSELS, Feb 15 (Reuters) - Nigeria's Dangote oil refinery has issued tenders to sell two fuel cargoes for export, the first from the newly commissioned refinery, a tender document showed and trading sources with knowledge of the matter told Reuters.
Nigeria has for years relied on expensive imports for nearly all the fuel it consumes but the $20 billion refinery is set to turn it into a net exporter of fuel to other West African countries, in a huge potential shift of power and profit dynamics in the industry.
Dangote declined a Reuters request for comment.
The first cargo is 65,000 metric tons of low-sulphur straight run fuel oil, which Dangote has awarded to Trafigura and is due to load at the end of February, three of the sources said. Trafigura declined to comment.
At least one refiner said they had been offered the cargo by Trafigura without elaborating further.
The second tender is for about 60,000 tons of naphtha loading on Feb. 23-29, a tender document seen by Reuters showed. The deadline for submissions of bids closed on Thursday afternoon, a trader who participated in the tender told Reuters.
Sources told Reuters last week that the refinery was preparing to deliver its first fuel cargoes to the domestic market within weeks.
https://www.reuters.com/business/energy/nigerias-dangote-refinery-export-first-fuel-cargoes-2024-02-14/
There is discontent in every country in the world at the moment rocky, tell me a country where there isn't a political, social, economic or geopolitical crisis.
Whilst I am fully cognisant that that the risk is always heightened in African countries, I would be surprised if it led to a coup in Nigeria the probability is never zero as one would never want to tempt fate but I would still say the probabilities are on the lower end of the spectrum.
A lot of the crisis has been driven by de-valuation of Naira, but that's an active decision that the federal government took short to attract foreign direct investment short term pain for long term gain.
Whatever is going on there is a lot of discontent and anything can happen when this gets out of control in African countries as we have seen all to often over recent times:-
https://www.bbc.co.uk/news/world-africa-68402662
Zengas - On the below does the below mean we had 200 mmcf/d as processed export capacity prior to the CPF so with the CPF facility we are able to transport processed gas volumes of 400 mmcf/d. Still quite unsure as to the detail behind it
I think the company needs to highlight the benefits of this capital expenditure it terms of what it means for the accugas asset, it's important for the company to highlight the detail as it better informs the market of the potential accugas has as sometimes value can simply be misinterpreted if the company does not make an effort in articulating it's benefits even thought they could be transformational but sometimes can be lost due to the fact that market has not been fully informed of the benefits.
Trust - the compression project was to increase the gas export pressure to a maximum 81 bar and deliver 110 mmcf/d per train (x 2) if i've read it right. A $45m capex project with completion later this year.
Rockyride - it’s fake news…… It’s quite difficult to do a coup in Nigeria given the way its political structure and constitution is set up. I would put the chance of it happen below 1%
https://x.com/hqnigerianarmy/status/1761839691312119986?s=46&t=bdVeLrGB139mDog1SFRNlw
Scroll down to the Nigerian coup article
TY Z - Would be great to see after all the years, having drilled 5 from 5. With everything going on in the company we will get good news at some point but after the Coup in Niger, I was not expecting this to come home to please us TY. With very little if anything priced in ATM for Niger, it would be great to see your minimum as per examples above but around 7p on to the SP. With the Nigeria compression project due to complete within the next 4 months, getting closer to ICC decisions, SS hopefully with AD sometime in the next 5 weeks, renewables as another possible hydrocarbon acquisition we have a lot to play for. I have a few tasty questions outstanding with IR but they have been a bit thin on the ground over recent times due to sick absences. I wont even mention the DRF deal which we all so eagerly await.
RR once the R3 project was sanctioned for development and close proximity especially to the pipeline just 30 km away, those 2C should be reclassified as 2P and be worth at least $120-$140m ($4/barrel) imo as they are new long life production compared to mid-life/mature assets.
Phase 1 initial production to 1.5k bopd then phase 2 with inter field flowlines and moving to 5k bopd. Personally hoping that with the upside potential in deeper levels and pressure communication on one of the bigger fields (Amdigh) it may double those reserves at little cost (but wait and see approach).
146 prospects/targets identified so yes i believe 2.8 billion bl recoverable estimate. I think they'll only every drill a fraction but if they can get to 3-400 mmbls reserves with production/pipeline access then they should be worth $1b+ particularly when we're paying $1250m for some 300 mmbls supposed reserves in S.Sudan thats mid-late life. Niger pipeline is to expand to 300k bopd with pumping stations. No reason why we can't get to 300 mbls reserves alone from the low hanging fruit at 75% COS on the Sokor alternances.
Trust - the compression project was to increase the gas export pressure to a maximum 81 bar and deliver 110 mmcf/d per train (x 2) if i've read it right. A $45m capex project with completion later this year.
Anyone know the finer detail around CPF facility and what that does for us operationally for the accugas asset don’t think I have seen the detail behind it and what or how that transforms the company
Hopefully Niger is back in play now…………
Https://www.energyintel.com/0000018d-c744-d02b-abed-e7653b6b0000
Hi Z - quick question if I may:-
If Niger came on initially at 1.5kboepd transported via the new pipeline and moved 35mboe from 2C to 2P what would you value that at to us. And additionally what would you value it at 5kboepd?
My concern here is that we are quoting 35mboe 2C even before any well tests. Hope to god Amdigh + the other 4 do commercially produce.
Do we have about 2.8bn boe risked recoverable here to shoot for?
Obviously we’d have to fork out the CAPEX and construct our tie-in pipeline at Agadem. But David Clarkson told me this could be done in less than 3 months (could already be done for all we know) as it’s a very simple, modular, plug and play design.
Back to the good old days convo LOL
Brilliant find Zengas and lots of news outlets reporting now.
Acquisitions or not savannah should get equipment in Niger in March and start operations in April / May. I hope they stop dilly dadle and final start paying Niger the attention it deserves sometimes concentrating on what you have is the best way to move forward.
Need to see a serious plan for Niger out in place now for the year
Updated 3:50 PM GMT, February 24, 2024
ABUJA, Nigeria (AP) — West Africa’s regional bloc known as ECOWAS has lifted travel, commercial and economic sanctions imposed on Niger that were aimed at reversing the coup staged in the country last year, a senior official announced Saturday.
https://apnews.com/article/west-africa-ecowas-niger-mali-burkina-faso-abuja-ae53abf8464dce5487cd7a3d73e0a9c0
Https://nairametrics.com/2024/02/09/president-tinubu-signs-amended-electricity-bill-into-law/
Another week chalked off, all quiet on the savannah front, anyone got live trackers on where savannah staff are at
Hello SailPlane,
Circa March/April 2022.
Best, 🐸
..wonder how long ago that was taken...
https://www.energyvoice.com/oilandgas/africa/ep-africa/546940/savannah-clocks-another-south-sudan-extension/
Thanks for this Tier, and for your superb contribution too.
Very best, 🐸