* Graphic of oil majors' Africa reserves https://tmsnrt.rs/2MbStPz
By Bate Felix
PARIS, Aug 16 (Reuters) - Shortly after launching a newproject in Angola, French oil major Total said it wassearching for more resources in Africa, including in Senegal andMauritania.
The company is historically strong in Africa and, buoyed byrising oil prices and improved terms for its multi-billiondollar Kaombo contract in Angola, it is doubling down.
Guy Maurice, Total's head of exploration and production inAfrica, told Reuters that the company had completed seismicsurveys and planned to start drilling exploratory wells inSenegal and Mauritania in West Africa.
He did not give a specific timeframe, but a source familiarwith the matter said the drilling would begin at the end of thisyear or in early 2019.
Total has broken ranks with some of its rivals in recentyears and largely ignored the rush to U.S. shale. It is lookingto eke out conventional oil and gas resources, seeking projectsin sub-Saharan Africa and the Middle East.
The strategy carries risks. It has left the company exposedto political instability that has deterred some competitors.
And although production costs in its sub-Saharan Africa oiland gas operations have fallen from $2.1 billion in 2014 to $1.3billion in 2017, they remain the highest among six geographicregions Total operates in, according to its 2017 annual report.
Total started production at the deep offshore Kaombo Northproject in Angola at the end of July. It has also announced itwill launch another field in the southern African country, Zinia2, which is expected to pump oil in 2020.
The company has a bigger presence in Africa than its rivals,although several of them are also major producers there and haveinvested billions of dollars in recent projects.
Exxon Mobil, for example, bought a 25 percent stake in Eni'sRovuma development in Mozambique last year for $2.8 billion.
Total has the largest proven reserves in Africa among theworld's top oil companies last year, according to a Reutersanalysis of company statements.
With 1.7 billion of barrels of oil equivalent (boe) inreserves in sub-Saharan Africa, it outstrips Eni's 1.5 billion.For the African continent as a whole, Chevron has 1.34 billionboe, Exxon Mobil 1.1 billion and Royal Dutch Shell 630 million.
NO CHAMPAGNE
Investors and analysts are looking closely at whether Totalcan keep a lid on costs in Angola, where it has struggled torein in spending in recent years and in 2014 needed oil pricesat around $70 a barrel to break even.
Total's Maurice told Reuters that a renegotiation with theAngolan government and suppliers had allowed Total to shave off$4 billion from the initial $20 billion budget for Kaombo.
On Zinia 2, capital expenditure was reduced by more than 50percent to $1.2 billion from $2.8 billion, he added. Whileprices have rebounded since the 2014 market collapse, nothingcan be taken for granted, said Maurice.
"Prices have gone from $26 per barrel to over $70, but weare not going to be bringing out the champagne, becausevolatility is still there. We could still fall back to $50 perbarrel tomorrow."
"At higher oil prices at $120 per barrel, you don't look tooclosely at what you spend," said Maurice, referring tonegotiating contracts with suppliers and the government.
He said the company's break-even oil price had come down asa result of its cost savings, but did not specify the price.
'LAST GUYS STANDING'
The $16 billion Kaombo project - Kaombo North, plus KaomboSouth which is due to start up next year - will produce anestimated 230,000 barrels of oil per day at peak, according toTotal, and is expected to increase Angola's output by 10percent.
Zinia will add another 40,000 barrels per day.
"A lot of the majors have had their heads turned by tight(shale) oil in the U.S., but Total has not really gone thatroute. They're still focused on West Africa, and Angola's a bigpart of that," said Adam Pollard, a senior research analyst onAfrica oil and gas at Wood Mackenzie.
For Angola, an oil-dependent OPEC member and Africa's secondlargest crude exporter, Total's commitment was important becauseits output had been declining steadily due to the lack ofinvestments in its ageing offshore fields.
In Nigeria, Total's Egina field is expected to startproduction in December and it will make a final investmentdecision on its Ikike tie-back project this year, as well as itsLake Albert project in Uganda.
The company expects these projects to help it increase itsAfrican production by 7 percent to 750,000 barrels of oilequivalent per day in 2020 compared with 2014. It has alsobought oil blocks in Guinea, Namibia, South Africa and Kenya.(Additional reporting by Stephen Eisenhammer in Luanda andDuncan Miriri in Nairobi; editing by Pravin Char)
