 Oil output in Equatorial Guinea is forecast to increase to a peak of 390,000b/d by 2013Equatorial Guinea Oil and Gas Report Q3 2009 - new market report just published
By: Mike King As regards natural gas, the region in 2008 consumed an estimated 107bn cubic metres (bcm), with demand of 177bcm targeted for 2013. Production of an estimated 211bcm in 2008 should reach 356bcm in 2013, which implies net exports rising from an estimated 104bcm in 2008 to 179bcm by the end of the period. Equatorial Guinea in 2008 consumed an estimated 1.37% of the region's gas, with its market share set to be 1.06% by 2013. It contributed an estimated 2.93% to 2008 regional gas production and, by 2013, will account for 1.85% of supply. In terms of the OPEC basket of crudes, the average price in Q109 was an estimated US$45.78 per barrel (bbl), down 13% from the US$52.51/bbl recorded during the previous three months. During the second quarter, there has been little change to our view of oil market developments. The report is forecasting an average OPEC basket price of US$51.30/bbl, with the March gains being retained in April, before further recovery to a possible US$57.00 is seen by June. For 2009, we are still assuming an average OPEC basket price of US$52.00/bbl (-45% year-on-year) For the whole of 2009, the assumption for gasoline is an average US$56.89/bbl, with the price peaking at a forecast monthly average of US$64.75 in December 2009. The overall y-o-y fall in 2009 gasoline prices is put at 44.1%. For gasoil in 2009, the forecast is for an average price of US$69.35/bbl, assuming a monthly high of US$94.48/bbl in December. The full-year outturn represents a 42.8% fall from the 2008 level. The monthly average jet fuel price is forecast to range from US$53.75 in February to US$96.76/bbl in December, proving an annual level of US$71.78/bbl. This compares with US$124.95/bbl in 2008. In 2009, GDP growth is forecast at 3.2%, following an estimated 10.1% in 2008. The predicted 2010 growth rate is 4.1%, followed by 1.9% in 2011. We expect oil demand to rise from an estimated 1,050b/d in 2008 to 1,340b/d in 2013. State oil company GEPetrol's primary focus is to manage the interest stakes of the government in various production sharing contracts (PSCs) and joint ventures (JVs) with international oil companies (IOCs). Thanks to IOC investment, oil output is forecast to increase from an estimated 370,000b/d in 2008 to a peak of 390,000b/d in 2012/13, before going into decline. Gas production should reach 6.6bcm by 2013, up from an estimated 6.2bcm in 2008. Consumption is expected to rise from 1.5bcm to 1.9bcm by the end of the forecast period, providing exports of 4.7bcm - in the form of liquefied natural gas (LNG). Between 2008 and 2018, we are forecasting a decrease in Equatorial Guinea oil and gas liquids production of 4.7%, with volumes peaking at 390,000b/d in 2012/13, before falling steadily to 353,000b/d by the end of the 10-year forecast period. Oil consumption between 2008 and 2018 is set to increase by 62.9%, with growth slowing to an assumed 5.0% per annum towards the end of the period and the country using 1,710b/d by 2018. Gas production is expected to rise to 7.1bcm by the end of the period. With demand rising by 62.9% between 2008 and 2018, there is scope for exports of around 4.7bcm. Details of the 10-year forecasts can be found in the Appendix to this report. Equatorial Guinea occupies ninth place in the updated Upstream Business Environment rating, and is now five points ahead of Sudan. It is in a reasonable position to move higher over the medium term. The county's score benefits from moderate oil and gas output growth prospects and attractive licensing terms. The country's risk environment is somewhat shaky, but this is hardly uncommon in the African region. The country is at the bottom of the league table in the updated Downstream Business Environment rating, with no high scores and progress further up the rankings unlikely unless the energy market grows rapidly or refineries are built. It is ranked 10th thanks to low scores for refining capacity, oil and gas demand, likely refining capacity expansion, nominal GDP and population. Angola is comfortably ahead of it in the regional rankings. http://www.companiesandmarkets.com/ # # # Browse thousands of market research reports covering major markets, companies and countries. Www.companiesandmarkets.com is a central source of market research reports from the world’s leading analysts and report publishers. End
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