East Africa
1
© 2013 Gaffney Cline & Associates. All Rights Reserved.
GCA Disclaimer and Copyright Notice GCA Disclaimer The material and opinions expressed in this presentation are those of the authors. While they reflect what is believed to be informed opinion, they are not represented as being the opinions of the any of the sources of information. Readers are urged to obtain independent advice on any matter relating to the material contained herein.
Copyright Notice All materials in this presentation are protected by copyright law and may not be reproduced, distributed, transmitted, displayed, published or broadcast without the prior written permission of Gaffney, Cline & Associates. Unauthorized commercial publication or exploitation of text, images or content of this presentation is specifically prohibited.
2
© 2013 Gaffney, Cline & Associates. All Rights Reserved.
Agenda • Overview – Area of Interest – Active Companies • Subsurface Overview – Regional Geology – Petroleum Systems • Latest Activities • Technical Challenges
3
© 2013 Gaffney Cline & Associates. All Rights Reserved.
Area of Interest
SOUTH SUDAN SOUTH SUDAN
ETHIOPIA ETHIOPIA
UGANDA KENYA KENYA
TANZANIA TANZANIA
10004500m
4000-4500m
MOZAMBIQUE MOZAMBIQUE
10002500m
1,267
0 kilometres
Source: Petroview (Deloitte) 4
© 2013 Gaffney Cline & Associates. All Rights Reserved.
An Independent’s View of East Africa... • One of the last areas on Earth where onshore billion
barrel accumulations can still be found with good contract terms • Ability to assemble massive acreage position of almost 300,000 km2 (74 MM acres, equivalent to 1,200 North Sea blocks) • New discoveries in Uganda and Kenya have raised industry interest level and will bring much needed infrastructure to the region • Existence of distinct petroleum systems...rifts across East Africa
5
© 2013 Gaffney Cline & Associates. All Rights Reserved.
Active Companies Country and Active Operating Companies: • Mozambique, Tanzania (deep water dry gas) – Anadarko, Eni, Statoil/Exxon, Bg/Ophir, Sasol, Total, Petronas, Petrobras, Shell, Orca, Heritage, Aminex, Afren, Tullow
• Uganda, Kenya (waxy shallow rift oil, deepwater – dry gas only?) – Tullow/CNPC/Total, and Tullow/Africa Oil (Kenya Onshore) – Apache, Anadarko, Afren, Taipan, Ophir Energy, Pan Continental and Origin (Offshore)
• S. Sudan (Cretaceous age, rift valley, high viscosity/waxy crude) – Petronas, Total, CNPC
• Ethiopia (modest discoveries – Oil/Gas/Condensate, shallow oil, deeper
gas) – Tullow, Marathon, Africa Oil, South West Energy, Transglobal Petroleum, Calvalley Petroleum, Afar Exploration, Petrotrans, Pexco
6
© 2013 Gaffney Cline & Associates. All Rights Reserved.
Country Comparison Country
Oil Reserves Gas Oil Production Mbbl/d Bbbl Resources Tcf 2011 Est.
Southern Sudan
5*
3*
345 prior to war – Building up to 150-200 this year
-
Poor
50
Uganda
1-1.2
0
-
-
Poor
20.3
-
-
Poor
13
Kenya
Inflation Rate %
Mozambique
0
100+
-
335.5
Poor
3.4
Tanzania
0
30+
-
75.4
Poor
19
Ethiopia
0.43
1-2
-
-
Poor
20
Nigeria
37.2
180
~ 2,590
3,382.6
Fair
12.8
* For Sudan (prior to division of country)
7
Gas Production MMcf/d Infrastructure 2011 Est.
© 2013 Gaffney Cline & Associates. All Rights Reserved.
source: The World Fact Book Jan 2011+
SUBSURFACE OVERVIEW
8
© 2013 Gaffney Cline & Associates. All Rights Reserved.
Regional Geology
Source: Hidden Treasures
Source: Science Direct 9
© 2013 Gaffney Cline & Associates. All Rights Reserved.
Regional Geology & Structural Style • An active rift environment containing the Ethiopian and East African Rift systems • Formation of numerous rift basins, classic horst and graben geometries • Continued extension will see the Somalian Plate break free from the Nubian Plate
Source: East Africa's Great Rift Valley: A Complex Rift System by James Wood and Alex Guth - Michigan Technological University 10
© 2013 Gaffney Cline & Associates. All Rights Reserved.
Cretaceous Aged Rifts
Selected East African Petroleum Systems Sudan
1. 2. Ethiopia
3. South Sudan Democratic Republic of the Congo
East African Rift Complex Muglad – Anza Basin Deepwater / Ultradeepwater
Kenya
Each of the Petroleum Systems has different characteristics and critical success factors.
Uganda
Tanzania
Zambia
Mozambique
Zimbabwe
Source: The basemap is a Space Shuttle radar topography image by NASA 11
© 2013 Gaffney Cline & Associates. All Rights Reserved.
Gas Discoveries Oil Discoveries
East African Rift Complex • Western and Eastern Branches of the Tertiary Rift Basin have subtly different geological histories • Recent Success in both Branches
– Western Branch (Uganda) – Albert Basin Discoveries (Tullow/Heritage) – Eastern Branch (Kenya) – Ngamia Discovery (Tullow) • Significant recent exploration activity – Total/CNPC farm-in to Tullow (Albert Basin) – Tullow farm-in to Africa Oil Acreage in Kenya – Marathon Petroleum into Africa Oil Acreage in Kenya – Deemed a “Hot Play”, will recent success be continued? Eastern Branch Ngamia-1 Well (projected)
Source: Talbot et al. 2004 Eastern Branch
12
© 2013 Gaffney Cline & Associates. All Rights Reserved.
Rift Reservoirs • Sandstone reservoirs interbedded
with shale and occasionally volcanics • Reservoir thickness and quality variable • Local sediment sources – Volcanic input – Complex diagenesis – Quartz, Carbonate and Clay cements
• Reservoir productivity likely to be
affected – are some stratigraphic levels better than others? • Lacustrine Type 1 source rocks – Oils tend to be high viscosity and waxy Source: Tiercelin et al 2004
13
© 2013 Gaffney Cline & Associates. All Rights Reserved.
Muglad (South Sudan) – Anza (Kenya) Basin • Cretaceous Aged Rift
Basin • Proven and Productive in South Sudan • More recently proven productive in Kenya
Source: NOC Kenya
14
© 2013 Gaffney Cline & Associates. All Rights Reserved.
Muglad/ Anza - Sudan + Kenya • Cretaceous aged Sandstone Reservoirs • Structural traps • Reservoir Quality can be variable • Oils tend to be high viscosity and waxy • Some gas reported in Kenya • Reservoir depths from 1,500 – 3,500+ m
Source: GeoExpro 15
© 2013 Gaffney Cline & Associates. All Rights Reserved.
Deep/Ultra Deep Water - Rovuma Delta • The Rovuma Basin, situated in the
north of Mozambique, is part of an extended East African marginal basin which includes parts of the coastal plains and continental margins of Tanzania and Kenya. • The basement of the basin is composed of crystalline and metamorphic rocks of pre-Cambrian age. • The sedimentary fill is represented by continental terrigenous Karoo sediments, marine and lagoonal Jurassic deposits, and marine and deltaic rocks of Cretaceous and Cenozoic age. Source: Wentworth Resources
16
© 2013 Gaffney Cline & Associates. All Rights Reserved.
Deep/Ultra Deep Water - Mozambique Anadarko Offshore Area 1 • Prosperidade complex: ~17 – 30+ Tcf • •
• • • • Source: Anadarko 17
© 2013 Gaffney Cline & Associates. All Rights Reserved.
gross recoverable resources Atum & Golfinho: ~15-35+ Tcf gross recoverable resources 2012 successful Barquentine-2 flow test – 90-100 MMscf/d facility constrained – 100-200+ MMscf/d well design Completing Appraisal program (Multiple flow tests planned) Reserve certification expected in 2013 FID targeted in late 2013 Anticipate first sales in 2018
Mozambique – Offshore Area 4 • Area 4 is located in deep water up to a depth of 2,600 m in the Rovuma Basin and
covers an area of 17,646 km2 in a previously unexplored geological basin; • In April 2013 Eni successfully completed the Area 4 appraisal plan with the drilling and
testing of Mamba South 3 which encountered 214 meters of gas pay in high quality Oligocene and Eocene reservoirs. • The well results have exceeded expectations and Eni has updated the estimate of the Mamba Complex and Coral discoveries to 80+ Tcf of gas in place.
9 wells drilled on Area 4 to date
Mamba North East 2 Mamba South 3
3D Seismic Wells to be drilled Discoveries Gas Discovery Encountered Oil
Source: ENI 18
© 2013 Gaffney Cline & Associates. All Rights Reserved.
Latest Activities - Deep Water Gas Play Mozambique and Tanzania • US Geological Survey estimate 441 Tcf of gas lies off East Africa (incl. Kenya, Mozambique, Tanzania). • Anadarko plans to have 2 x 5 MMt/y LNG trains in Mozambique in
place by 2018 scope for 2 more to follow every 2 years (enough gas to support 10 trains or more for 20 years) • Anadarko & ENI claim combined Mozambiquan discovered
resources in excess of 100+ Tcf – ENI Mozambique plans to share in LNG projects • Tanzania – 20 Tcf between 8 discoveries. LNG developments
2020 onwards – The basin floor play due to be drilled in 2013
19
© 2013 Gaffney Cline & Associates. All Rights Reserved.
Latest Activities - Inland Waxy Crude Play Uganda and Kenya
• Tullow estimates P50 reserves 1.1 Bbbl in Lake Albert Basin • Estimated $20 Bn to be invested by Tullow and partners with a view to
production in 2016 – EA-1 (Total operator), EA-2 (Tullow operator), EA-3 (CNOOC operator) – FID depends on investment in refinery project and/or export pipeline • Tullow’s discovery in Kenya (Ngamia) may have found 50+ MMbbl –
Ngamia#1 well currently being tested • Tullow 2nd discovery on 31st October 2012 (Twiga South-1 in Kenya block
13T) confirms the string of pearls concept • Tullow commenced drilling at the Etuko prospect. This well will target a new
play area in the Lockichar Basin where a working petroleum system has been confirmed by recent discoveries at Ngamia and Twiga. (Prospective resources ~231 MMBbl) South Sudan • Back on production Q1 2013
Source: World Oil Online 20
© 2013 Gaffney Cline & Associates. All Rights Reserved.
Technical Challenges • Onshore waxy oil, hundreds/thousands moderate tech
wells – High long term maintenance/OPEX – Artificial Lift, sand control, chemicals, corrosion • Deep water offshore, high tech, 10-20 well batches – Lower OPEX – Primarily gas, deep mono-bores, subsea, negligible work-overs • Will we find a deep water oil prone play in the next 18 months?
21
© 2013 Gaffney Cline & Associates. All Rights Reserved.
Promising E. Africa Frontier Basins May , 2013 More excitement to come!
Blocks L8 Apache 1 well? Blocks L9, L15 - Ophir 1-3 wells Blocks L10A, 10B – BG 1-2 wells Basin floor fan in Tanzania
Map Source: Petroview (Deloitte)
Block 1 – Anadarko ? Blocks 2, 5 – Statoil/Tullow 1-2 wells Blocks 3,6 – Petronas/Total 1-2 wells
22
© 2013 Gaffney Cline & Associates. All Rights Reserved.
© 2013 Gaffney Cline & Associates. All Rights Reserved.
GCA Disclaimer and Copyright Notice GCA Disclaimer The material and opinions expressed in this presentation are those of the authors. While they reflect what is believed to be informed opinion, they are not represented as being the opinions of the any of the sources of information. Readers are urged to obtain independent advice on any matter relating to the material contained herein.
Copyright Notice All materials in this presentation are protected by copyright law and may not be reproduced, distributed, transmitted, displayed, published or broadcast without the prior written permission of Gaffney, Cline & Associates. Unauthorized commercial publication or exploitation of text, images or content of this presentation is specifically prohibited.
2
© 2013 Gaffney, Cline & Associates. All Rights Reserved.
Agenda • Overview – Area of Interest – Active Companies • Subsurface Overview – Regional Geology – Petroleum Systems • Latest Activities • Technical Challenges
3
© 2013 Gaffney Cline & Associates. All Rights Reserved.
Area of Interest
SOUTH SUDAN SOUTH SUDAN
ETHIOPIA ETHIOPIA
UGANDA KENYA KENYA
TANZANIA TANZANIA
10004500m
4000-4500m
MOZAMBIQUE MOZAMBIQUE
10002500m
1,267
0 kilometres
Source: Petroview (Deloitte) 4
© 2013 Gaffney Cline & Associates. All Rights Reserved.
An Independent’s View of East Africa... • One of the last areas on Earth where onshore billion
barrel accumulations can still be found with good contract terms • Ability to assemble massive acreage position of almost 300,000 km2 (74 MM acres, equivalent to 1,200 North Sea blocks) • New discoveries in Uganda and Kenya have raised industry interest level and will bring much needed infrastructure to the region • Existence of distinct petroleum systems...rifts across East Africa
5
© 2013 Gaffney Cline & Associates. All Rights Reserved.
Active Companies Country and Active Operating Companies: • Mozambique, Tanzania (deep water dry gas) – Anadarko, Eni, Statoil/Exxon, Bg/Ophir, Sasol, Total, Petronas, Petrobras, Shell, Orca, Heritage, Aminex, Afren, Tullow
• Uganda, Kenya (waxy shallow rift oil, deepwater – dry gas only?) – Tullow/CNPC/Total, and Tullow/Africa Oil (Kenya Onshore) – Apache, Anadarko, Afren, Taipan, Ophir Energy, Pan Continental and Origin (Offshore)
• S. Sudan (Cretaceous age, rift valley, high viscosity/waxy crude) – Petronas, Total, CNPC
• Ethiopia (modest discoveries – Oil/Gas/Condensate, shallow oil, deeper
gas) – Tullow, Marathon, Africa Oil, South West Energy, Transglobal Petroleum, Calvalley Petroleum, Afar Exploration, Petrotrans, Pexco
6
© 2013 Gaffney Cline & Associates. All Rights Reserved.
Country Comparison Country
Oil Reserves Gas Oil Production Mbbl/d Bbbl Resources Tcf 2011 Est.
Southern Sudan
5*
3*
345 prior to war – Building up to 150-200 this year
-
Poor
50
Uganda
1-1.2
0
-
-
Poor
20.3
-
-
Poor
13
Kenya
Inflation Rate %
Mozambique
0
100+
-
335.5
Poor
3.4
Tanzania
0
30+
-
75.4
Poor
19
Ethiopia
0.43
1-2
-
-
Poor
20
Nigeria
37.2
180
~ 2,590
3,382.6
Fair
12.8
* For Sudan (prior to division of country)
7
Gas Production MMcf/d Infrastructure 2011 Est.
© 2013 Gaffney Cline & Associates. All Rights Reserved.
source: The World Fact Book Jan 2011+
SUBSURFACE OVERVIEW
8
© 2013 Gaffney Cline & Associates. All Rights Reserved.
Regional Geology
Source: Hidden Treasures
Source: Science Direct 9
© 2013 Gaffney Cline & Associates. All Rights Reserved.
Regional Geology & Structural Style • An active rift environment containing the Ethiopian and East African Rift systems • Formation of numerous rift basins, classic horst and graben geometries • Continued extension will see the Somalian Plate break free from the Nubian Plate
Source: East Africa's Great Rift Valley: A Complex Rift System by James Wood and Alex Guth - Michigan Technological University 10
© 2013 Gaffney Cline & Associates. All Rights Reserved.
Cretaceous Aged Rifts
Selected East African Petroleum Systems Sudan
1. 2. Ethiopia
3. South Sudan Democratic Republic of the Congo
East African Rift Complex Muglad – Anza Basin Deepwater / Ultradeepwater
Kenya
Each of the Petroleum Systems has different characteristics and critical success factors.
Uganda
Tanzania
Zambia
Mozambique
Zimbabwe
Source: The basemap is a Space Shuttle radar topography image by NASA 11
© 2013 Gaffney Cline & Associates. All Rights Reserved.
Gas Discoveries Oil Discoveries
East African Rift Complex • Western and Eastern Branches of the Tertiary Rift Basin have subtly different geological histories • Recent Success in both Branches
– Western Branch (Uganda) – Albert Basin Discoveries (Tullow/Heritage) – Eastern Branch (Kenya) – Ngamia Discovery (Tullow) • Significant recent exploration activity – Total/CNPC farm-in to Tullow (Albert Basin) – Tullow farm-in to Africa Oil Acreage in Kenya – Marathon Petroleum into Africa Oil Acreage in Kenya – Deemed a “Hot Play”, will recent success be continued? Eastern Branch Ngamia-1 Well (projected)
Source: Talbot et al. 2004 Eastern Branch
12
© 2013 Gaffney Cline & Associates. All Rights Reserved.
Rift Reservoirs • Sandstone reservoirs interbedded
with shale and occasionally volcanics • Reservoir thickness and quality variable • Local sediment sources – Volcanic input – Complex diagenesis – Quartz, Carbonate and Clay cements
• Reservoir productivity likely to be
affected – are some stratigraphic levels better than others? • Lacustrine Type 1 source rocks – Oils tend to be high viscosity and waxy Source: Tiercelin et al 2004
13
© 2013 Gaffney Cline & Associates. All Rights Reserved.
Muglad (South Sudan) – Anza (Kenya) Basin • Cretaceous Aged Rift
Basin • Proven and Productive in South Sudan • More recently proven productive in Kenya
Source: NOC Kenya
14
© 2013 Gaffney Cline & Associates. All Rights Reserved.
Muglad/ Anza - Sudan + Kenya • Cretaceous aged Sandstone Reservoirs • Structural traps • Reservoir Quality can be variable • Oils tend to be high viscosity and waxy • Some gas reported in Kenya • Reservoir depths from 1,500 – 3,500+ m
Source: GeoExpro 15
© 2013 Gaffney Cline & Associates. All Rights Reserved.
Deep/Ultra Deep Water - Rovuma Delta • The Rovuma Basin, situated in the
north of Mozambique, is part of an extended East African marginal basin which includes parts of the coastal plains and continental margins of Tanzania and Kenya. • The basement of the basin is composed of crystalline and metamorphic rocks of pre-Cambrian age. • The sedimentary fill is represented by continental terrigenous Karoo sediments, marine and lagoonal Jurassic deposits, and marine and deltaic rocks of Cretaceous and Cenozoic age. Source: Wentworth Resources
16
© 2013 Gaffney Cline & Associates. All Rights Reserved.
Deep/Ultra Deep Water - Mozambique Anadarko Offshore Area 1 • Prosperidade complex: ~17 – 30+ Tcf • •
• • • • Source: Anadarko 17
© 2013 Gaffney Cline & Associates. All Rights Reserved.
gross recoverable resources Atum & Golfinho: ~15-35+ Tcf gross recoverable resources 2012 successful Barquentine-2 flow test – 90-100 MMscf/d facility constrained – 100-200+ MMscf/d well design Completing Appraisal program (Multiple flow tests planned) Reserve certification expected in 2013 FID targeted in late 2013 Anticipate first sales in 2018
Mozambique – Offshore Area 4 • Area 4 is located in deep water up to a depth of 2,600 m in the Rovuma Basin and
covers an area of 17,646 km2 in a previously unexplored geological basin; • In April 2013 Eni successfully completed the Area 4 appraisal plan with the drilling and
testing of Mamba South 3 which encountered 214 meters of gas pay in high quality Oligocene and Eocene reservoirs. • The well results have exceeded expectations and Eni has updated the estimate of the Mamba Complex and Coral discoveries to 80+ Tcf of gas in place.
9 wells drilled on Area 4 to date
Mamba North East 2 Mamba South 3
3D Seismic Wells to be drilled Discoveries Gas Discovery Encountered Oil
Source: ENI 18
© 2013 Gaffney Cline & Associates. All Rights Reserved.
Latest Activities - Deep Water Gas Play Mozambique and Tanzania • US Geological Survey estimate 441 Tcf of gas lies off East Africa (incl. Kenya, Mozambique, Tanzania). • Anadarko plans to have 2 x 5 MMt/y LNG trains in Mozambique in
place by 2018 scope for 2 more to follow every 2 years (enough gas to support 10 trains or more for 20 years) • Anadarko & ENI claim combined Mozambiquan discovered
resources in excess of 100+ Tcf – ENI Mozambique plans to share in LNG projects • Tanzania – 20 Tcf between 8 discoveries. LNG developments
2020 onwards – The basin floor play due to be drilled in 2013
19
© 2013 Gaffney Cline & Associates. All Rights Reserved.
Latest Activities - Inland Waxy Crude Play Uganda and Kenya
• Tullow estimates P50 reserves 1.1 Bbbl in Lake Albert Basin • Estimated $20 Bn to be invested by Tullow and partners with a view to
production in 2016 – EA-1 (Total operator), EA-2 (Tullow operator), EA-3 (CNOOC operator) – FID depends on investment in refinery project and/or export pipeline • Tullow’s discovery in Kenya (Ngamia) may have found 50+ MMbbl –
Ngamia#1 well currently being tested • Tullow 2nd discovery on 31st October 2012 (Twiga South-1 in Kenya block
13T) confirms the string of pearls concept • Tullow commenced drilling at the Etuko prospect. This well will target a new
play area in the Lockichar Basin where a working petroleum system has been confirmed by recent discoveries at Ngamia and Twiga. (Prospective resources ~231 MMBbl) South Sudan • Back on production Q1 2013
Source: World Oil Online 20
© 2013 Gaffney Cline & Associates. All Rights Reserved.
Technical Challenges • Onshore waxy oil, hundreds/thousands moderate tech
wells – High long term maintenance/OPEX – Artificial Lift, sand control, chemicals, corrosion • Deep water offshore, high tech, 10-20 well batches – Lower OPEX – Primarily gas, deep mono-bores, subsea, negligible work-overs • Will we find a deep water oil prone play in the next 18 months?
21
© 2013 Gaffney Cline & Associates. All Rights Reserved.
Promising E. Africa Frontier Basins May , 2013 More excitement to come!
Blocks L8 Apache 1 well? Blocks L9, L15 - Ophir 1-3 wells Blocks L10A, 10B – BG 1-2 wells Basin floor fan in Tanzania
Map Source: Petroview (Deloitte)
Block 1 – Anadarko ? Blocks 2, 5 – Statoil/Tullow 1-2 wells Blocks 3,6 – Petronas/Total 1-2 wells
22
© 2013 Gaffney Cline & Associates. All Rights Reserved.
