Equatorial Guinea plans to push through a new hydrocarbon framework next week, with formal approval set for Monday. Minister of Hydrocarbons and Mineral Development Antonio Oburu Ondo said the package "brings a lot of competitiveness, more flexibility" to contractual terms and will offer "a wide range of contractual options based on risk appetite."
The near term aim is straightforward: restart drilling campaigns. "We don't have a target per se, but what we are focusing on is to make sure that companies start their drilling campaigns," Ondo noted while speaking at a conference in Cape Town.
Production has withered to 20,000 barrels a day in September, compared with 140,000 barrels a day six years earlier, according to data compiled by Bloomberg. The International Monetary Fund expects the economy to contract 1.7% this year. As the smallest member of OPEC, the country is trying to arrest the slide by reopening talks with companies and widening deal structures.
Officials said they would consider one-on-one talks about open blocks, and they have created special economic zones aimed at drawing investment. Ondo noted that companies evaluate "fiscal, legal, geological, you name it" factors before committing capital, adding, "Without a positive outcome that comes out of this analysis, I doubt it very much that they would invest."
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Investments by Chevron Corp in natural gas stand out as a rare positive, with Meren Energy Inc and Vaalco Energy Inc also active. ExxonMobil Holdings Corp., once a major producer in the country, exited in 2024 after almost three decades.
The spoils of the oil boom have largely flowed to the country's power brokers, among them President Teodoro Obiang Nguema Mbasogo, in office since taking power in 1979. Despite decades of output, the nation still posts some of the continent's weakest social indicators and has a poor human rights record.
Even with departures from The Organization of the Petroleum Exporting Countries and Equatorial Guinea's own declining output, the government still sees value in the alliance. "It's always a good thing to be part of a group, right? Especially a group with such an influence," Ondo said.
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