BMI View: With an FID on Golar LNG and a stronger - than - expected oil production growth, Cameroon benefited f ro m an upward revision in both oil and gas production over our forecast period. In addition, the country will now become an LNG net exporter from 2017 onward, an important tool for exports diversification , notably after the large oil price drop over the past year. Nevertheless, we maintain that Cameroon remains a modest oil and gas producer and more exploration will need to take place to boost its long-term prospects further.
|e/f = BMI estimate/forecast. Source: National sources, BMI|
|Crude, NGPL & other liquids prod, 000b/d||80.8||95.6||97.5||99.5||102.2||105.3||104.2|
|Refined products production, 000b/d||43.2||43.2||43.2||58.3||59.5||60.1||60.7|
|Refined products consumption & ethanol, 000b/d||40.7||43.1||45.7||48.4||51.3||54.4||57.1|
|Dry natural gas production, bcm||0.3||0.3||0.3||1.9||2.7||2.9||2.9|
|Dry natural gas consumption, bcm||0.6||0.7||0.7||1.2||1.2||1.3||1.3|
Ongoing exploration provides much-needed upside risk to Cameroon's oil and gas reserves. The country's offshore basins are the most prospective, with the Rio del Rey Basin to attract the most interest. In the context of bearish oil prices, we believe that Cameroon stands to benefit from companies refocusing investments towards more proven and shallow-water offshore plays.
In December 2015, Bowleven submitted the Bomono Exploitation Authorisation Application (BEAA) to the Cameroon authorities as planned. As of early 2016, the company reported that its extended flow test programme at the Moambe and Zingana wells on Bomono is now complete, with promising results which support plans for initial supply of between 51-61mn cubic metres of gas per day, geared towards power generation. In April 2016, the company secured a one-year extension to the Bomono exploration permit as it seeks approval towards development of the finds. The company has also reportedly begun discussions with potential gas offtakers and signed an MOU ENEO.
In February 2016, Victoria Oil and Gas further expanded its presence in the area by reaching an agreement with Glencore Exploration Cameroon Limited and Afex Global Limited to acquire a 75% interest in Cameroon's Matanda PSC, with AFEX retaining a 25% share. The North Matanda field is estimated to hold an estimated P50 'gas-in-place' volume of 1.8 Tcf and 'condensate-in-place' of 136 Mmbbl. A work programme was submitted for further seismic and well drillings targeted by Q416.
We have recently increased our Cameroon oil production forecast as a result of stronger-than-expected oil production growth over 2015. We now expect production will continue on a slow, but upward trajectory to above 100,000b/d until 2020, with upside risks based on pending development plans.
We maintain our current refining forecast, keeping it unchanged this quarter. There are no updates on progress toward the Limbe refinery expansion plans. We note increasing downside risks to the project over the coming quarters, with the government critically lacking funds due to falling oil prices.
A small boost in crude oil production should maintain Cameroon's status as a net crude oil exporter in the medium term. The refinery expansion project should help boost Cameroon's small net refined products exports by 2017.
We have revised up our Cameroon natural gas production forecast following the final approval made by Golar and Perenco on the Cameroon floating liquefied natural gas (FLNG) project. The project will see production ramp-up by a further 1.6 billion cubic metres (bcm) over 2017-2018 to feed to LNG terminal.
Gas consumption is still very small, but is slowly ramping up as gas supply agreements with power generation companies and manufacturing companies are being put into place. The ramp-up will continue to 2019, by which time gas production ramp-ups will be geared toward the Golar FLNG project, resulting in a stagnation of gas available for domestic consumption unless production ramps up further.
Following a final investment decision (FID) on the Golar FLNG project in October 2015, we have included the FLNG project within our forecast period. The project will effectively turn Cameroon into a gas exporter from 2017 onwards, with LNG net exports of 1.5bcm-1.6bcm from 2018 onwards.
The Cameroon Oil & Gas Report has been researched at source and features BMI Research's independent forecasts for Cameroon including major indicators for oil, gas and LNG, covering all major indicators including reserves, production, consumption, refining capacity, prices, export volumes and values. The report includes full analysis of industry trends and prospects, national and multinational companies and changes in the regulatory environment.
BMI's Cameroon Oil & Gas Report provides professionals, consultancies, government departments, regulatory bodies and researchers with independent forecasts and competitive intelligence on the Cameroonian oil and gas industry.
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