US Chevron Starts Equatorial Guinea Gas Flow
US major Chevron reported first gas from the Alen gas monetisation (AGM) project in the Douala Basin offshore Equatorial Guinea February 26. The project consists of a 70-km pipeline with a capacity of 950mn ft³/day. It said the gas would be processed through onshore existing facilities, "maximising development of current and future regional gas resources."
Energy minister Gabriel Mbaga Obiang Lima said the investment was "crucial to the economy of Equatorial Guinea and the region. The Gas Mega Hub is an Investment that has created jobs during difficult economic times."
The Alen backfill project entails producing 580bn ft³ of reserves over six years and transporting it to the existing gas-processing facilities in Punta Europa for LNG, liquid petroleum gas and gas condensate processing. The project represents a direct foreign investment of about $475mn, according to the host government.
And with the prospective closure of deals with Cameroon and Nigeria, he said, "we intend to incentivise the industry, drive economic growth, and generate revenues for regionals governments to help finance education, hospitals and infrastructure. It is possible with natural gas and we are committed to doing it with new technologies and investments.”
Cameroon has resources in the Yoyo-Yolanda cross-border field, which could represent the second phase of the AGM project. A bilateral agreement between Equatorial Guinea and Nigeria allows for the potential to transport Nigerian gas to Bioko Island. This, on top of talks with Cameroon, could potentially trigger additional investments in Punta Europa, including the construction of a second LNG train and implementation of other new projects. Equatorial Guinea and Nigeria met for talks on gas flows February 23.
Equatorial Guinea launched the Equatorial Guinea Gas Mega Hub in 2019 to make the most out of existing infrastructure and support the country's gas industry and employment. It had expressed dissatisfaction with Marathon's pace of investment upstream and threatened to find another operator. That year, US producer Marathon signed a definitive agreement to process third-party Alen Unit gas through existing infrastructure in Punta Europa, with first gas expected this year.