Lagos — Equatorial Guinea has granted oil and gas companies two-year extensions on their exploration programmes, a statement from the hydrocarbons minister said.
The move is an effort to keep investments flowing into the nation’s energy industry amid a historic drop in oil demand and prices brought on by the new coronavirus.
The outbreak, and lockdowns worldwide aimed at containing it, have slashed 30% from fuels demand and dragged global oil prices to 20-year lows. Companies have cut billions from investment budgets and suspended projects as a result.
“The granting of these extensions has been deemed suitable to create an enabling environment for international and African companies to keep investing in Equatorial Guinea and ensure a quick recovery of our industry,” Minister Gabriel Obiang Lima said in the statement.
The extensions were granted by ministerial order.
Obiang Lima said last week that virtually all oil and gas projects and licensing rounds are on hold in the Central African nation as it braces for an extended oil downturn because of the pandemic.
Equatorial Guinea relies on oil and gas for around 90% of state revenue. Oil companies operating in Equatorial Guinea include Exxon Mobil, Marathon Oil Corp, Kosmos Energy, and Noble Energy.
