Equatorial Guinea is a small country with a population of 857000 people, tucked away just below Cameroon, on the coast of Western Central Africa. Besides the mainland the country has 5 tiny volcanic offshore islands that make up its whole. The country’s capital Malabo is located on one of these – Bioko Island. The country has also been blessed with a rich supply of gas condensate reserves, which amount to more than 4.6 tcf. At the recent CWC LNG & Gas Series: 8th Asia Pacific Summit, we managed to sit down and speak with His Excellency Minister Gabriel Mbaga Obiang Lima of Equatorial Guinea’s Ministry of Mines & Hydrocarbons to find out more about the LPG industry there.
The Alba Plant
His Excellency began the session by telling us more about the Alba LPG Plant on Bioko Island. His Excellency told us that the Alba field has been producing gas for the country since 1991 and with majority of the gas initially being flared. Production of LPG however, began in 1997 – initial extraction was at 1700 bbl/d and went up to 2400 bbl/d in 1998. He explained that since 2005, the plant has been modernized and now produces 8,000 bpd of butane, 14,000 bpd of propane and 6,000 bpd of condensed gas. He said that this has been made possible thanks to the development of the Alba Plant on the field by Marathon Oil and Geogas who have greatly assisted in expanding the plant and commercializing the production there. The plant has storage capacity for 1.3 million bbls of condensate and 730,000 bbls LPG. His Excellency also went on to tell us that, earlier this year, the country’s national gas company – Sonagas begun marketing the State’s share of LPG produced at the Alba Plant. The company has already opened negotiations with offtakers and is looking to market its LPG production stake to international buyers. Currently Equatorial Guinea supplies some African nations like Cameroon and Ivory Coast with LPG from the plant.
He said that the Government believes this is a major step for local content in Equatorial Guinea and reiterated what he said to the media, “Sonagas marketing its share of LPG fulfills one of the major objectives envisaged by the State in creating the company a decade ago – that Sonagas increases its capacity across the spectrum of gas activities. The company is evolving to take on more of the gas business throughout the entire value chain.”
His Excellency also told us that because demand within the country is low, that they fulfil all their domestic needs for LPG through the gas produced at the Alba plant. The government is trying to increase demand across the country as there is currently competition from other types of fuels such as Kerosene and Diesel. The Government feels that it can increase demand of the gas by simply making more gas available and plans to allocate more of what is produced at the plant locally. The only two gas distributors in the country; Sonagas and Geogas have so far been doing a great job of growing demand in the country and he believes that they will continue to improve circulation of the gas in the Equatorial Guinea in the future.
His excellency said that the Government strongly supports the use of the gas in the country but it is the poor perception of people that the gas is dangerous and that they are also much more comfortable using kerosene, as it is what they have been using for years and it is what they know. The cost of LPG for a 13kg cylinder is 5000 Central African Francs (7.96 USD) on the island and 8000 Central African Francs (12.73 USD) on the mainland. These prices are subsidized by the government and the LPG subsidy has been in place for more than 10 years.
In addition to this His Excellency told us that to further increase use of gas, they plan to increase their exploration efforts by drilling more wells in the field for further discoveries. Further discoveries will allow them to offtake more gas to surrounding nations which will allow them to beef up their own local infrastructure and develop an LPG transportation system. His Excellency told us that at the moment, the country predominantly uses LPG for household cooking purposes but they are now looking into the fuel to be used for fueling a fleet of vehicles. The government has already purchased 10 fuel transportation vehicles that run on LPG and there are plans to supply a large fleet of public buses. This plan is still in the initial phases however and will take some time before it goes live.
In April last year the country also set up a new filling plant in Bata which has been developed by TiApm. This goes hand in hand with the Government’s plans to increase demand on the mainland. The Bata filling plant has a 500 bottles/hour filling capacity and 300 MT storage capacity. The plant will greatly assist in serving the whole country in increasing its use of LPG as well as increase their ability to provide cylinder for export to neighbouring countries. His excellency sees the future of LPG in the country as being bright and with so much room for growth and a decent supply of the gas, he is extremely optimistic on the outlook of the local industry there.
(LPG Business Review)
H.E. Minister Gabriel Mbaga Obiang Lima