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Reports that Russian crude is being transhipped off the West African coast and in Egypt signal a fast-changing  oil market as Asian buyers access cheap crude rejected by western buyers. This has implications for African producers, while market sources say there are also signs of Russian crude ending up in products sold in Africa

Toronto Stock Exchange (TSX)-listed Tenaz Energy Corporation has pulled out of its takeover of SDX Energy after only 20.2% of the London AIM-listed firm’s shareholders voted in favour of the deal. In further corporate manoeuvres, Egypt-Morocco-focused SDX has lined up a new anchor investor, Aleph Commodities, with which it is working on a “refreshed and ambitious strategy”.

Houston-based independent Vaalco Energy is to acquire Canada’s TransGlobe in an all-share transaction valued at $307m, creating a larger Africa-focused independent exploration and production company.

Within months of offering the company to a receptive market, UK private equity (PE) investor Actis and partner Mainstream Renewable Power announced on 18 July that they had signed an agreement to sell Lekela Power to Egyptian/UAE-based Infinity Group (and its Abu Dhabi-based ally Masdar) and Lagos-based multilateral Africa Finance Corporation (AFC).

Cairo has not budged on its commitment to Rosatom and the Dabaa nuclear project, regardless of international sanctions and other western attempts to diplomatically and financially isolate Russia over Ukraine. Construction has begun in earnest at Dabaa, which says much about the underlying strength of Cairo-Moscow relations, but the project’s real drivers are domestic and regional, writes John Hamilton.

A 1.1 GW wind power project by Acwa Power and Hassan Alam Utilities (HAU) is the first to be agreed since regulations were changed to allow wind turbines to almost double in height, indicating the authorities intend to move quickly. A key outstanding question is whether the price of the power purchase agreement remains the same as that for earlier projects.

Egypt has taken major strides towards the government’s long-stated objective of establishing itself as the hub of the eastern Mediterranean gas trade, with agreements signed with Israel, the European Union and Chevron in June. The concept fits in with Europe’s response to the Ukraine war by offering an alternative to Russian gas.

Denmark’s Vestas has said the 241.5MW Gulf of Suez wind power plant is expected to reach commercial operations in Q4 22 or Q1 23. Fernando Iwan Glazer, head of marketing for Vestas’ African operations, told African Energy the project was proceeding on schedule.

London (LSE)-, Irish- and Ghana Stock Exchange-listed Tullow Oil’s merger with Capricorn Energy (ex-Cairn Energy) brings together two FTSE250 independent exploration and production companies to create an Africa-focused entity with a bigger portfolio and longer pockets. Capricorn’s balance sheet complements Tullow’s regional depth, but questions remain over who gains most from the merger and the deals promised to follow.

Toronto Stock Exchange (TSX)-listed Tenaz Energy Corporation is buying Egypt- and Morocco-focused gas producer SDX Energy in an all-share $27m acquisition backed by SDX’s management and board. The deal will see SDX delist from London’s AIM market and brings an ambitious Canada-based independent into North Africa.

Authorities in Cairo are anxious to get some high-profile green hydrogen (GH2) schemes going as quickly as possible. This means international companies that have signed MoUs with the government to develop schemes are in a race against time to complete a six-step project preparation plan before COP27 opens in November.

Not all headwinds are fair for Egypt’s ambitious plans for regional energy leadership. The achievement of some of the lowest wind and solar generation tariffs anywhere in Africa has been one of the signal achievements of Egypt’s renewable energy strategy to date, but rates will now go back up given supply bottlenecks with China and other issues.

A high level government authorisation doubling the permitted height of wind turbines in all areas of Egypt could dramatically increase the amount of green power generation capacity that can be developed.

Galvanised by the possibilities presented by green hydrogen (GH2), the Cairo authorities have drawn up an extraordinary vision for transforming the Egyptian energy sector and economy in the coming decades. The plans include tens or possibly hundreds of gigawatts of renewable power, barrages of electrolysers, an entirely new export-focused energy infrastructure, plus renewables-powered sea water desalination projects to break the millennia-old dependence on the River Nile. Most of the technology, financing and fully worked-out strategies have yet to be put in place, but the government aims to sign the first commercial deals at the COP27 summit in November. African Energy gives details of this policy in a series of articles

With less than six months to go before COP27 opens at Sharm El Sheikh, a power shift is under way as energy and momentum drain from the United Kingdom’s presidency and build in Egypt’s camp. The early signs are that the next event will have a very different tone and character from COP26 in Glasgow, with considerably less emphasis on making big policy claims that may be hard to keep and a focus on getting climate-related business deals signed.