Cameroon Producers Eye Gas Deal
Jersey-registered New Age (African Global Energy) has signed a letter of intent (LoI) with London-listed Victoria Oil & Gas on the supply of gas from the Etinde field it operates off the coast of Cameroon.
The LoI initiates talks on a 20-year supply contract that would see New Age deliver at least 25mn ft3/day to Victoria’s subsidiary Gaz du Cameroun (GDC) in the first three years, rising to 30mn ft3/day afterwards, New Age’s London-listed venture partner Bowleven said in a stock filing on February 5.
The LoI will remain valid March 31 2021, when the binding contract is expected to be signed. The contract’s finalisation is subject to Etinde’s developers taking a final investment decision at Etinde. Bowleven expects this milestone in the third quarter of this year.
The company has a 25% stake in the field, while New Age and Russia’s Lukoil have 37.5% each.
Confirming the agreement, Victoria said in a statement that GDC intended to use Etinde’s gas to supplement supplies from its own onshore licences in the area to planned and existing power plants in the energy-starved Douala market. It will need to build a 60-km pipeline to receive the field's volumes.