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Saturday 26 October 2013

Ethiopia to get $4 billion investment for leap into geothermal power

Ethiopia has signed a preliminary agreement with a U.S.-Icelandic firm for a US$4 billion private sector investment intended to tap its vast geothermal power resources and help it become a major exporter of energy for East Africa.
Reykjavik Geothermal, whose Icelandic geothermal expertise is backed by U.S. investors, signed a deal with Ethiopia on Wednesday to construct a 1,000 MW geothermal power plant, Africa's largest, in the volcanically active Rift Valley.
When complete, the project will be Ethiopia's biggest foreign direct investment, run by its first privately owned utility. In an economy traditionally dominated by state spending, the government has suggested that the nascent sector could be a model for increased private investment.
"This is an epic moment for all of us ... bringing Ethiopia to the forefront of geothermal development," said Reykjavik Geothermal CEO Gudmundur Thoroddsson, who signed the deal with Mihret Debebe, his counterpart at the state-run Ethiopian Electric Power Corporation (EEPCO), in Addis Ababa.
Ethiopia currently suffers frequent blackouts because of a lack of power. But it is due to boost its generating capacity from 2,000 MW to 10,000 MW within the next three years, much of it coming from the 6,000 MW Grand Renaissance Dam under construction on the Nile.
Experts put its hydropower potential at around 45,000 MW and its geothermal potential at 5,000 MW, but Reykjavik says the accessible geothermal resources could be nearer 15,000 MW.
"For 50 years, everyone has known that there was potential, but the initial risk and initial cost of developing geothermal is high," said Reykjavik Geothermal managing director Thorleifur Finsson.
"After we managed to develop many sites in Asia and America, eyes have been opened that there is a possibility and ... today's technology has minimized that financial risk," he said. "There is huge potential."
PRIVATE FINANCE
Power will be extracted from under the volcanic Corbetti Caldera crater by pumping water to a depth of more than 1,000 meters to be superheated in geological strata where the temperature is around 350 degrees Celsius (660 Fahrenheit).
Finsson said it was envisaged that the first 500 MW of power from the Corbetti Caldera would come onstream in 2018, and the second 500 MW by 2021, but that finance had so far only been committed for a first phase of exploration drilling.
Depending on the results of this, he said he expected "financial close at around end of December 2014 or beginning of 2015". He said the power purchase agreement was expected to commit EEPCO to buy the station's output for 25 years.
Ethiopia, Africa's second most populous country, has also been one of the continent's fastest growing economies, with 9.7 percent growth in fiscal 2012/13.
However, much of this is the result of heavy public infrastructure spending; the International Monetary Fund has said balance of payments pressures and the difficulties faced by the private sector - whose share of Ethiopia's GDP is the sixth lowest in the world - raise doubts about its growth model.
At the unveiling of the geothermal project in New York last month, Prime Minister Hailemariam Desalegn, in office for just over a year, suggested this might have to change if Ethiopia was to meet its expanding power generation ambitions.
"My vision is that over the next 30 years, we will need to harness as much as 80,000 MW of hydro, geothermal, wind and solar power, not just for Ethiopia, but for our neighboring countries as well ...
"We will need to partner with the private sector to bring in significant private investment going forward. From that perspective, this 1,000 MW project with RG is not that large - but it's a great start. What Africa needs now is not just aid, but trade and investment."
By Aaron Maasho
Additional reporting and editing by Kevin Liffey
Source: Thomson Reuters, 2013.

Friday 25 October 2013

East Africa Oil & Gas Summit opens in Nairobi on October 29th as part of the Kenya@50 Celebrations

Advertiser's Blog

The 2nd East Africa Oil and Gas Summit (EAOGS) which opens in Nairobi next week has officially been announced as part of the Kenya@50 Celebrations. The Summit which includes a strategic conference and exhibition is taking place on the 29th and 30th October at the Intercontinental, Nairobi.

‘’Following on from the huge success of the summit last year, we are very proud that the East Africa Oil & Gas Summit is officially part of the Kenya 50 Celebrations. As President Kenyatta unveils plans for country wide celebrations of Kenya’s 50 year anniversary of independence, we are honoured that the East Africa Oil & Gas Summit has been highlighted as a key event to launch the start of Kenya’s Celebrations’’ said Danny Grogan, Managing Director of the organising company; Global Event Partners (K) Ltd.

EAOGS is set to welcome 400 delegates from over 180 regional and international companies and the Summit features 18 headline sponsors, including Ernst & Young, Afren, NOC Kenya, Africa Oil, ABS, Barclays, CFC Stanbic Bank and Newport Africa.

Rosie Topp, Global Event Partners Ltd
rtopp@gep-events.com
UK Direct line: +44 20 3488 1193
UK Mobile: +44 7581 130130
UK Direct line: +44 20 3488 1193
UK Mobile: +44 7581 130130
---------------------------------------------------------------

EAOGS 2013 will bring together regional National Oil Companies, Ministries, IOC's, independent oil companies, service companies, legal advisors and investors to debate the oil and gas road map for the region. The Speaker line-up features Sumayya Atthmani, CEO, National Oil Corporation, Kenya; Henry Rotich, Mohamed Lino Benjamin, Director General of Petroleum, Ministry of Petroleum, Mining and Industry, South Sudan Cabinet Secretary for the National Treasury, Kenya Galib Virani, Director, Afren East Africa Exploration; Hassan Hassan, Managing Director, Operations,  Simba Energy; Silvester Kasuku, Director General/CEO, LAPSSET Corridor Development Authority. The speaker line up so far features 40 regional and international experts representing both government and private sector companies.

The Ministry of Energy and Petroleum in Kenya are looking forward to welcoming the international community to Nairobi to unite all the key players in the market and examine how to drive the oil and gas industry forward in Kenya and across East Africa. At  the recent EAOGS press launch The Principal Secretary at the Ministry of Energy and Petroleum, Kenya, Eng. Joseph Njoroje spoke about the necessity to build up Kenya’s infrastructure to ensure the successful development of the hydrocarbon industry for the benefit of all parties: ‘’We want to be a good example of the hydrocarbons in Kenya… The most important success factor of this industry is setting up of the infrastructure so that by the time you are extractive industry reaches its maturity stage, the infrastructure should be in place to avoid wastage and to avoid pilferage, to ensure the industry itself brings in the benefits to the investor, to the country and to the local community. ‘’ said the Principal Secretary.

He also spoke of his commitment to the EAOGS programme and the importance of knowledge transfer so Kenya is ready to develop the hydrocarbon sector: ‘’I have been assured by the team from Global Event Partners that this Summit is one of a difference. Global Event Partners are ready to engage the stakeholders including our Ministry so that they can identify the gaps in awareness and focus more in their summit in filling those gaps. ‘’

EAOGS 2013 will build on the success of the 2012 Summit which was co-hosted by the Ministry of Energy, Kenya and Global Event Partners (K) and was a resounding success welcoming 326 delegates from over 170 regional and international companies attended with delegates coming from 29 countries.

Danny Grogan, Managing Director of the organisers Global Event Partners (K) Ltd explained the success factor behind the EAOGS Summit ‘’EAOGS benefits from  the continued support and guidance from the Kenyan Ministry of Energy and Petroleum and the National Oil Company which positions EAOGS as the event of choice for all the leading industry companies. And Grogan concluded:  ‘’EAOGS looks set to break new ground and attract 400 domestic and international participants to Nairobi this October.’’

Press contact
Organisers:
EAOGS is organised by Global Event Partners (K) Ltd, a specialist international event organiser in the oil and gas, infrastructure and financial sectors. Our team at Global Event Partners has more than 40 years’ experience in organising leading industry conferences and exhibitions around the world.

Global Event Partners is affiliated to the dmg::events network. dmg::events are the organisers of world renowned oil and gas events including Gastech, ADIPEC, the Global Petroleum Show and the  World Heavy Oil Congress and are a subsidiary of the Daily Mail and General Trust plc, one of the largest media companies in the UK. www.gep-events.com             


Tuesday 22 October 2013

World Geothermal Energy Summit 2013


Advertiser's Blog


When: 5th to 6th of December 2013

Where: Kenya & Olkaria Geothermal Field, Kenya - Nairobi



Connecting Technology, Financing and Regulation towards a Sustainable East African Geothermal Energy Portfolio.

According to the African Union Commission (AUC), the Geothermal Risk Mitigation Fund, launched last month in Kenya, Uganda, Tanzania, Rwanda and Ethiopia and administered by German insurance company, KfW, will provide more than Sh5 billion (50 million euros) to compensate companies or government bodies that are unsuccessful in undertaking exploration drilling of geothermal prospects.

This fund entails that organisations which take insurance cover with KfW get back 80 per cent of the money invested in the exploratory activities if it drills a well with capacity to produce less than 5MW. Kenya expects to benefit significantly as it is estimated to hold more than two thirds of the geothermal potential in the region, estimated to be over 10,000MW. This is why, the 4th World Geothermal Energy Summit 2013 will be held in Nairobi, Kenya on 5-6th December 2013.



The 4th annual WGES will discuss the opportunities to ensure your return on capital (ROC) in this ebullient emerging market as you solidify your East African geothermal energy business, including:

• Contract formats and indicative power costs under Joint Venture and Energy Conversion Agreements.
• Geothermal risk mitigation.
• Land acquisition and management and
• Human resettlement strategy and execution.

For more details on how to register and attend: http://www.arcmediaglobal.com/geothermal/


Friday 11 October 2013

400 Oil & Gas Leaders meeting in Nairobi in 3 weeks’ time for International East Africa Oil & Gas Conference

Advertiser's Blog


Blogger's note:
The 2nd East Africa Oil and Gas Summit (EAOGS) is set to take place from the 29th to 30th October in Nairobi, Kenya. The turnout is bigger and better this year, compared to last years event, despite of the recent Westgate Mall terrorist attack in Westlands, Nairobi. This reveals that foreign oil and gas industry stakeholders still have confidence in Nairobi and Kenya at large. 

Nairobi continues to attract many business travelers and potential investors as it continues to solidify its pre eminent position as East Africa's financial and logistics hub. It also looks set to become the hub for the emerging eastern and central Africa oil and gas industry. 

The organisers of the EAOGS, the Global Event Partners (K) Ltd., look set to host a successful event and have every confidence that it will provide value for money, in a safe and secure environment for its participants.



See the press release by the EAOGs summit 11th October 2013 below:


The 2nd East Africa Oil and Gas Summit (EAOGS) is set to welcome 400 delegates from over 150 regional and international companies on the 29th and 30th October at the Intercontinental Hotel, Nairobi. Despite the recent events in Westgate, delegates and sponsors are continuing to book from all over the world as now more than ever companies want to show their support and belief in the huge opportunities that the oil and gas sector has to offer throughout East Africa.  In the last 10 days 3 new Gold sponsors; NOC Kenya, CFC Stanbic Bank and Milio, have joined the event and EAOGS 2013 now boasts 15 headline sponsors, a 200% increase in sponsors compared with last year’s summit.

The Ministry of Energy and Petroleum in Kenya are looking forward to welcoming the international community to Nairobi to unite all the key players in the market and examine how to drive the oil and gas industry forward in Kenya and across East Africa. At  the recent EAOGS press launch The Principal Secretary at the Ministry of Energy and Petroleum, Kenya, Eng. Joseph Njoroje spoke about the necessity to build up Kenya’s infrastructure to ensure the successful development of the hydrocarbon industry for the benefit of all parties: ‘’We want to be a good example of the hydrocarbons in Kenya… The most important success factor of this industry is setting up of the infrastructure so that by the time you are extractive industry reaches its maturity stage, the infrastructure should be in place to avoid wastage and to avoid pilferage, to ensure the industry itself brings in the benefits to the investor, to the country and to the local community. ‘’ said the Principal Secretary.

He also spoke of his commitment to the EAOGS programme and the importance of knowledge transfer so Kenya is ready to develop the hydrocarbon sector: ‘’I have been assured by the team from Global Event Partners that this Summit is one of a difference. Global Event Partners are ready to engage the stakeholders including our Ministry so that they can identify the gaps in awareness and focus more in their summit in filling those gaps. ‘’

EAOGS 2013 will bring together regional National Oil Companies, Ministries, IOC's, independent oil companies, service companies, legal advisors and investors to debate the oil and gas road map for the region. The Speaker line-up features Sumayya Atthmani, CEO, National Oil Corporation, Kenya; Galib Virani, Director, Afren East Africa Exploration; Hassan Hassan, Managing Director, Operations,  Simba Energy; Silvester Kasuku, Director General/CEO, LAPSSET Corridor Development Authority. The speaker line up so far features 33 regional and international experts representing both government and private sector companies and the full list of confirmed speakers, participating companies and the latest programme are available to view on the website eaogs.com.

EAOGS 2013 will build on the success of the 2012 Summit which was co-hosted by the Ministry of Energy, Kenya and Global Event Partners (K) and was a resounding success welcoming 326 delegates from over 170 regional and international companies attended with delegates coming from 29 countries.

Danny Grogan, Managing Director of the organisers Global Event Partners (K) Ltd explained the success factor behind the EAOGS Summit ‘’EAOGS benefits from  the continued support and guidance from the Kenyan Ministry of Energy and Petroleum and the National Oil Company which positions EAOGS as the event of choice for all the leading industry companies. And Grogan concluded:  ‘’EAOGS looks set to break new ground and attract 400 domestic and international participants to Nairobi this October.’’

Press contact
Rosie Topp, Global Event Partners Ltdrtopp@gep-events.com
UK Direct line: +44 20 3488 1193
UK Mobile: +44 7581 130130
UK Direct line: +44 20 3488 1193 UK Mobile: +44 7581 130130

---------------------------------------------------------------

Organisers:
EAOGS is organised by Global Event Partners (K) Ltd, a specialist international event organiser in the oil and gas, infrastructure and financial sectors. Our team at Global Event Partners has more than 40 years’ experience in organising leading industry conferences and exhibitions around the world.

Global Event Partners is affiliated to the dmg::events network. dmg::events are the organisers of world renowned oil and gas events including Gastech, ADIPEC, the Global Petroleum Show and the  World Heavy Oil Congress and are a subsidiary of the Daily Mail and General Trust plc, one of the largest media companies in the UK. www.gep-events.com

Tuesday 8 October 2013

Nigeria closes US$ 1.3 billion hydro deal

The government of Nigeria has signed an agreement with a consortium of China National Electric and Engineering Corporation and SinoHydro for the construction of the 700 MW(megawatt) Zungeru hydro-electric power project. Three quarters of the project is being financed by a major Chinese bank, to the tune of US$1.3-billion dollars, and the remaining quarter is likely to be paid for by the government of Nigeria. The plant, which is likely to be completed in four years, was captured in the 2012 to 2014 medium-term borrowing plan approved by the national assembly. 

Nigeria's finance minister Ngozi Okonjo-Iweala told Reuters this project is likely to create thousands of jobs for Nigerian engineers, technicians and artisans during the construction phase, benefiting the local economy. The project, which will be a boost to the country's 4,5 gigawatt electricity capacity, is part of the government's efforts to curb electricity shortages in the country.

African Energy Resources to sell off licences

African Energy Resources has entered into a binding letter of intent to sell its Zambian uranium licences to Karoo Exploration for US$ 2-million dollars  in cash and US$500 000 dollars in equity. The sale, according to the website Proactive Investors, will give the company extra cash in a tough capital raising environment, allowing it to focus on developing its coal projects in Botswana.

African Energy had previously flagged that it was pursuing divestment options for non-core uranium projects, which contain Measured, Indicated and Inferred Resources of more than 11 million pounds of U3O8. African 


Energy is focused firstly on developing its Sese Integrated Power Project to build an initial 300 megawatt power station, with its own dedicated coal mine, on a small part of the Sese deposit. Secondly, the Sese export project aims to ship processed Sese coal to Asia.

Mandatory blending of biofuels in South Africa

Mandatory blending of biofuels with petrol and diesel for South Africa will come into effect from October 1 2015, energy minister Ben Martins said. The regulation is in line with the cabinet decision taken in 2007 to use biofuels as a means of diversifying the country’s energy supplies. A five-year pilot project was envisaged with the aim of achieving a 2% biofuels penetration into the national liquid fuels pool.

According to the department of energy, cabinet-approved incentives such as a 50% rebate on the general fuel levy for biodiesel manufacturers and a three-year accelerated depreciation on the investment had failed to attract investors, and so a more effective regulatory support was needed. The date for the start of the blending has taken into consideration the time needed to finalise the biofuels pricing framework, which will happen before the end of this year.

Egypt and OPEC sign power plant deal

Egypt and the Organisation of the Petroleum Exporting Countries (OPEC)'s Fund for International Development (OFID) have signed a US 70-million dollar loan agreement to finance the South Helwan Power Plant.

The agreement is aimed at meeting growing electricity needs, especially as Egypt has suffered recently from repeated power cuts caused by high summer time energy use. Prime minister Hazem el-Beblawi, electricity minister Ahmed Imam and international co-operation minister Ziad Bahaa el-Din attended the signing ceremony. The project will benefit households, agricultural workers, businesses and industries, and in turn, help create jobs and boost the economy.

Nigeria hands over privatised plants

Nigeria has handed over its spun-off power companies to private buyers who paid a total of US 2,5-billion dollars in a series of open auctions. President Goodluck Jonathan presented the share certificates and licences to the new owners of six power generation companies and nine distribution firms that had paid up in full, at a ceremony in Abuja.

The public companies now gone private are among the 18 successors of the now defunct Power Holding Company of Nigeria. At least US$20-billion dollars have gone into several power reform programmes in the past 14 years of civilian rule, much of it wasted. The holding company was split into six generation, 11 distribution and one transmission companies. All the generating and distributing firms were sold separately

Monday 7 October 2013

Kenya seeks investors to build coal, natural gas power plants

As part of it’s +5000Mw in 40 months program, Kenya has invited bids from investors for the development of two power plants with a combined output of up to 1,800 megawatts (MW) from coal and natural gas, according to details from Ministry of Energy and Petroleum.
The ministry said it is seeking investors to develop a 700-800 MW natural gas fired plant near the port city of Mombasa.
“The proposed project will be a 700-800MW power plant to be located on a 300 acre parcel of land at Dongo Kundu or any other appropriate location between Mombasa and Kilifi,” the ministry said in a statement.
The ministry also plans to build a 900 to 1,000MW coal power plant in Lamu. Already, the government wants to develop a US$5.5 billion mega port in Lamu to link landlocked South Sudan and Ethiopia to the Indian Ocean.
This bidding process marks the beginning of a road map that will see Kenya increase electricity generation capacity by 5,000MW from the current 1,644MW to 6,700 MW in 40 months. On the list of projects expected to increase demand for electricity includes construction of the standard gauge railway, setting up of Konza city and other ICT towns.
For more details on the tender documents, please click on the link below.

Also planned is construction of an oil pipeline from South Sudan to Lamu as well as the mining industry, irrigation projects and demand by the newly formed county governments.
“We are also going to upscale power purchase agreements, which have been taking too long to conclude as well as deal with transmission and distribution challenges,” said Joseph Njoroge, Principal Secretary-Ministry of Energy and Petroleum. With increased generation capacity, the generation cost in $ cents is projected to reduce from 11.30 to 7.41.
Commercial and industrial tariff will also fall from US$c14.14 to US$c9.00 and domestic tariff from US$c19.78 to US$c10.45.
The 5000 MW additional generation capacity will be developed from geothermal-1646 MW, Natural Gas 1,050 MW, Wind 630 MW and coal 1,920 MW, all under the framework of public private partnership (PPP).
According to Davis Chirchir, Cabinet Secretary, Ministry Of Energy and Petroleum the country has a power deficit of 500 MW at present and 1,664 MW that has been developed over the past 50 years.
“What we have was designed for supply to homes and not industry and that is why many manufacturers are either struggling or have shut their operations, relocating to cheaper destinations,” he said
The Ministry is expected to shortly publish requests for proposals inviting Independent Power Producers (IPPs) to participate in generation while the Government concentrates in transmission and distribution.
The government has already allocated Sh80 billion in the 2013/14 budget, a large bulk of which would be used in transmission and distribution.
With capacity of 1,664 MW against a maximum-recorded demand of about 1,410MW, Kenya is under pressure to boost power generation as east Africa’s biggest economy is expected to expand at more than 5 per cent.
The government last month said it wants to add 5,000 MW to Kenya’s power output by 2017 to accelerate growth, which is expected to push Kenya’s power demand up to 15,000MW by 2030.
For more details on the tender documents, please click on the link below.