Sharjah-based Petrofac will develop an offshore gasfield in Cameroon with Africa-focused oil exploration company Bowleven.
Petrofac to invest $500m in African gas project
Petrofac, the oil services provider based in Sharjah, will invest up to US$500 million (Dh1.83 billion) to develop an offshore gasfield in Cameroon with the Africa-focused oil exploration company Bowleven.
Under the agreement, Petrofac will provide engineering, procurement and construction services for production at the Etinde concession, in which Bowleven holds a 60 per cent stake. "This is in line with our strategy of providing our exploration-led customers with integrated project delivery services," said Andy Inglis, the chief executive of Petrofac's Integrated Energy Services (IES) division. In return, the company will receive a part of the revenue generated from Etinde, giving it a quasi-equity stake in the project.
Bowleven is currently appraising the concession, which consists of three blocks located in shallow waters. "[The deal] should help alleviate funding concerns and validate the Etinde project in the eyes of investors," said Jack Allardyce, an analyst at Singer Capital.
Before committing to production, Petrofac will draw up a field development plan. Etinde is the latest deal struck by IES under the leadership of Mr Inglis, the former head of exploration and production at BP, who joined Petrofac last year. The London-listed company is seeking to double its net profits in the five years to 2015. Exposure to risky but lucrative operations by IES will be crucial to the success of these ambitions.
Last month, Petrofac said it was on track to grow its net profit this year by at least 15 per cent.
"We are currently experiencing high levels of bidding activity, particularly in the Middle East, North Africa and the [former Soviet Union]. Given this bidding activity and our competitive positioning, we expect to grow group backlog over the coming months," said Ayman Asfari, Petrofac's chief executive.