LUKOIL is continuing its expansion in West Africa. Company for $300 million bought 40% of the project offshore Senegal, in which after three years is planned to start the first field with the production of 5 million tons of oil per year. The sum of transaction, according to analysts, a small Russian company. Investment in African projects is more risky than in Russia, but in the case of Senegal, the agreement on production section gives LUKOIL the opportunity to obtain a good yield, according to analysts.LUKOIL has announced that it is acquiring 40% in the project of rufisque, Sangomar and Sangomar Deep (RSSD) offshore Senegal for $300 million By agreement of the parties, the seller — Cairn Energy PLC — can receive up to an additional $100 million after the start of production. The transaction will be closed after fulfilment of the suspensive conditions, including approval by the government of Senegal. Blocks with a total area of 2.2 thousand sq km located in the deep offshore of Senegal, 80 km from the coast. The RSSD project is implemented on the terms of the agreement on production section. Operator — Australian Woodside (owns 35%), other shareholders — the Australian FAR (15%) and the Senegalese state-owned Petrosen (10%). Within the project there are two fields: FAN and Sangomar, recoverable reserves latest LUKOIL is estimated at 500 million barrels of oil equivalent. Start Sangomar with the design production level of 5 million tons of oil per year and is scheduled for 2023.West Africa in recent years has become one of the strategic regions for LUKOIL. Because of the complexity with the expansion of the resource base in Russia, the company is actively buying shares in offshore international projects at an advanced stage of production to minimize risks. Recently, LUKOIL has acquired a 25% in the project Marine XII in Congo for $768 million, and 5% in concessions Ghasha in the UAE, and at the end of November 2019 increased from 18% to 40% of its stake in exploration block 132 in Nigeria. Also, the Russian company is discussing with the state GEPetrol entry into the project development unit EG-27 on the shelf of Equatorial Guinea with a share of 80% (20% from GEPetrol). In addition, at the beginning of 2021 can be investment decision on the project “Etinde” offshore Cameroon, where LUKOIL owns 37.5%. By the end of this year the company expects approval from the government of Ghana a development project on block Tano offshore fields Pecan.According to him, the influence on the indicator will be less than 10%. “This transaction continues the practice of recent years LUKOIL on the acquisition of the studied fields, after the mid-2010s, the results of exploration of the company on the number of fields in West Africa have not yielded the expected results,” he said.Andrey Polishchuk from Raiffeisenbank agrees that, as new projects in Russia is quite scarce, the company is looking to further investments abroad. According to him, since the project in Senegal find��Xia in the early stage of development, it is difficult to say how successful it will be. “It is obvious that the company has to take risks. And it would be preferable to invest in Russian projects, more familiar and often highly profitable,”— said the expert. But, he explains, the RSSD project under the terms of the agreement on section of production, which should increase the chances of a refund with attractive returns.Olga Matushenko
