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EU date for Arzew probe; Higher fuel prices in Abidjan; Indians seek Chevron east Africa assets; Technip gets EPC contract for fertiliser project

Kenya Petroleum Refineries Ltd is inviting bids for an engineering, procurement and construction contract for a liquefied petroleum gas (LPG) import, handling, storage and bottling facility in Mombasa.

Sterling farmout; Lundin farms into CNOOC block

India’s Essar Oil and Gas has agreed to accept the Kenyan government’s proposal to let Libya’s Tamoil Africa Holdings take half of its share in the Mombasa refinery (AE 138/19). The 50% stake in Kenya National Petroleum Refineries previously owned by Shell, BP and Chevron was provisionally sold last year to Essar, subject to the government waiving its right of first refusal. However, Tamoil subsequently came in with a more attractive bid.

Woodside Energy’s partners in the Lamu basin have told the Australian company they are terminating its farm-in agreement (FIA) because it refused to drill a second well after the failure of the deep-water Pomboo well, Australia’s Global Petroleum said. “The termination notice has been given based on Woodside’s refusal to drill a second exploratory well in the project area in accordance with the FIA and its failure to take any steps to remedy this refusal, which the company considers to be a repudiation and breach of the FIA,”

The government is hoping a compromise proposal can end a dispute over ownership of the Mombasa refinery and allow a badly-needed upgrade to go ahead.

The government has opted not to renew the management contract granted to Manitoba Hydro International to run Kenya Power & Lighting Company (KPLC). The Canadian company started its two-year contract in July 2006, and met the ambitious target of 120,000 new customer connections for the first year, which included intensive rural electrification.

ANGOLA: CMIC contract for Luanda grid; KENYA: Bamburi Cement to increase biomass use; LIBERIA: Stanley to study Mount Coffee expansion; MOROCCO: Abdelmoumen STEP deadline; MOZAMBIQUE: EDM seeks bids to extend grid; NIGERIA: Chinese to build first coal-fired plant; TANZANIA: AfDB funding; UGANDA: French JV to supply Bujagali; UPDEA: European meeting to discuss reform study

The Greening Tea Industry in East Africa Project (GTIEA) is seeking bids by 21 April from consultants for feasibility studies of six small hydropower projects to be built at tea factories in four East African countries.

Kenya Electricity Generating Company (KenGen) registered a 38% fall in net profit to $25.8m for the six months to December 2007, despite an 8.2% rise to $86m in production revenue.

If pessimists are right, it may come to be seen as a balmy period when the strong macroeconomic figures registered by a majority of economies, and the upturn in investor interest from fixed income assets to downstream hydrocarbons mega-projects, suggested that economic positives could now outweigh the perennial political risk factors when assessing African business – the trend recorded by African Energy in 2006-07 (AE 129/22, 120/1).

Eskom was a key beneficiary of the flurry of contracts whose announcement accompanied President Nicolas Sarkozy’s state visit in February.

President Jakaya Kikwete has given his support for plans by Artumas Group to export compressed natural gas to Kenya, signalling an apparent change of heart by the Tanzanian government.

India’s Essar Energy Overseas has agreed to buy a 50% stake in Kenya Petroleum Refineries Ltd (KPRL) from Shell Petroleum, Chevron Global and BP Africa. The government holds the other 50% equity in the 4m t/yr Mombasa refinery. The shareholders had been looking to sell up because they were reluctant to finance a planned upgrade.

Caution remains the watchword, but continuing crisis means financial markets analysts are producing increasingly gloomy outlooks for the Kenyan economy and its corporate champions, write Kevin Godier and Jon Marks.