West Africa could be the new go-to spot for oil and gas exploration. The latest from the region is that Ivory Coast is angling to increase its oil production to 200,000 barrels per day within five years.
Presently, production hovers around 32,000 bpd. The increase is a big leap, but Ivory Coast believes it can be pulled off based on recent exploration and discoveries.
Ever since Ghana, adjacent to Ivory Coast, discovered a huge oil field back in 2007 and started production by late 2010, West Africa has become a target of speculation by oil investors and developers.
Vanco Cote d’Ivoire, an oil company in the region, stated recently that it has discovered light oil on an offshore block off Ivory Coast, just half a year after Britain’s Tullow Oil (LON: TLW) made similar comments about a nearby block.
"With these discoveries and the projected investments, Ivory Coast will be able to realise its target of raising output from around 32,000 barrels per day now to around 200,000 bpd in the five years ahead," Ibrahima Diaby, head of hydrocarbons at the Ministry of Mines, Petroleum and Energy told Reuters in an interview.
Nearly ten years of political strife and a civil war in 2011 has caused Ivory Coast’s oil output to drop by almost half. Technical problems have compounded the issue.
But fourteen new production sharing agreements have been reached since the resolution of the civil war, and international oil giants like Total (NYSE: TOT), Anadarko (NYSE: APC), and others have gotten in on the rush.
Ghana and Ivory Coast have modified their heated rhetoric, and it’s possible some joint efforts may come to pass in the future. Diaby further comments that Ivory Coast’s government signed three exclusive exploitation deals for natural gas fields last year, and production could go up to about 250 million cubic feet per day. Presently, those levels are at around 170 mmcfd.
Ivory Coast is the world’s leading producer of cocoa, but it is trying to diversify its economic portfolio by looking into energy and mining. About $1.6 billion is expected to go into energy investments, with state firm Petroci and European and North American partners likely involved.