The Johannesburg-based company has “the possibility of an OML,” or oil-mining license, for a project that is in production phase in Nigeria, the continent’s largest economy and crude producer, Mboweni, 55, said yesterday in an interview. He declined to provide more detail on the stage of negotiations or the location of the asset.
SacOil is buying assets in Nigeria and has operational blocks in Malawi, Botswana and Democratic Republic of Congo, whose government has opened up dozens of exploration blocks. Companies such as BP Plc have bought assets off Namibia on a bet that the southern African nation’s coastal shelf may mirror that of Brazil across the Atlantic, while Anadarko Petroleum Corp. is working in waters off Mozambique in the southeast of the continent, home to the biggest gas finds in a decade.
Royal Dutch Shell Plc (RDSA) selling operations in Nigeria “is good for us” and the company is also “sniffing around” for prospects in Namibia among other areas in Africa, Mboweni said.
Some of the company’s investors prefer oil and gas prospecting companies because of the potential for capital appreciation, he said.
“The debate within the company is whether we’re going to stay upstream oil and gas or vertically and horizontally integrated,” he said.
SacOil isn’t interested in assets in South Africa, he said. The country’s semi-desert Karoo region may hold as many as 390 trillion cubic feet of natural gas and Total SA (FP) last week started operations to drill the country’s first deep-water well.
“We don’t have the capacity for that,” Mboweni said. “You could spend a lot of money and not get anything” from South African exploration, he said.
The company’s shares have more than doubled over the past 12 months in Johannesburg. They rose 1.9 percent to 55 cents at 12:08 p.m.
SacOil Chief Executive Officer Thabo Kgogo, who previously served as state-owned PetroSA’s chief operating officer, started the job last month. “His plan is that he needs something small, now, that produces say about 5,000 barrels,” Mboweni said. “Something that generates cash.”
As the debate over the direction of SacOil goes on, Mboweni envisages a company that will rival the majors.
“It’s astounding that with such major natural resources in Africa, we don’t have a pan-African giant,” Mboweni said. “That is part of the philosophy underpinning SacOil’s existence; we have to be that giant pan-African oil and gas company.”
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