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Jorf Lasfar Electricity Company (Jlec), owned by Abu Dhabi National Energy Company (Taqa), has reported a higher than initial estimated profit for 2013 – at MD415m ($50.7m) – on the back of MD4.9bn revenues. Income was down 16% on the year, but this was offset by a fall in the price of coal. Jlec, which listed on the Casablanca Bourse in December, announced a MD106.6/share dividend – equivalent to 24% of the initial public offering share price (AE 268/8).

The European Bank for Reconstruction and Development (EBRD) has approved a €65m sovereign guaranteed loan to Office National de l’Electricité et de l’Eau Potable (ONEE) to expand drinking water supply in the Azilal, Ben Guerir and Ouarzazate regions. The facility will also support the third phase of ONEE’s performance improvement programme for drinking water production and distribution. ONEE finance director Nawal Khalifa said the signing represented the EBRD’s second project with the state power and water utility following a €60m loan approved in March 2013 to support the long-running electricity access Programme d’Electrification Rurale Global (PERG) and implementation of a smart metering pilot study.

The Office National des Hydrocarbures et des Mines is inviting expressions of interest from consulting firms to provide technical advisory services to upgrade the Hydrocarbon Exploration Information System. The work includes upgrading the seismic processing and interpretation centres, updating the geoscience software, and studying and reviewing the electronic data management arrangements. Applications are due by 21 February.

Compagnie Marocaine des Hydrocarbures (CMH) has announced a minimum MD3bn ($362m) expansion plan, in the process taking a new name – Winxo – and including an estimated $100m-$120m project to build a petroleum products storage and distribution centre at Jorf Lasfar. Winxo president Hassan Agzenaï said his Holding Hogespar would finance 30%-40% of the programme from its own funds. The new Jorf Lasfar terminal on the Atlantic coast, with 600,000m3 storage capacity on a 22ha site, will add more than 50% of Morocco’s current products imports storage capacity, the company says. Some of this will eventually be exported, in line with Morocco’s policy of building export markets in north-west Africa, although this is not an immediate priority.

With big programmes to develop solar and wind generation, and several major thermal projects planned, Moroccan officials can demonstrate a dynamic business environment. Mustapha Bakkoury, head of solar agency Masen, can point to the $9bn Projet Solaire Marocain (PSM) development plan financed by international banks and agencies, local markets and equity. Along with a huge wind power programme and plans to exploit the gas – which could eventually involve building a regasification plant, probably at Jorf Lasfar – this represents a vision of development that governments dependent on five-year electoral terms might find impossible to implement, but which King Mohammed VI has personally pushed as part of a long-term energy security policy.

Cairn Energy is preparing to spud a well on the Juby Maritime III Block following a dry well on the adjacent Foum Draa Block. The well will drill down some 1,000 metres below the 1969 Cap Juby heavy oil discovery in the Upper Jurassic to target a Middle Jurassic carbonate prospect. Cairn said operations would begin once the FD-1 exploration well had been plugged and abandoned. The Cajun Express semisubmersible drillship spudded the FD-1 well in late October in 1,500 metres of water, targeting a Late Jurassic/Early Cretaceous deep-water turbidite slope fan and channel complex.

South Korea’s SK Innovation has farmed into Kosmos Energy’s Foum Assaka contract area in the Agadir Basin, buying a 12.5% stake from Fastnet Oil & Gas ahead of drilling next year. The deal includes a cost carry for a first exploration well on the Eagle prospect and an appraisal well or second exploration well, plus reimbursement of past costs. A well on the Eagle prospect is expected to spud in late Q1 2014. On completion, the equity split for the block will be Kosmos 39.9% and operator, BP 35.1%, Fastnet’s Pathfinder Hydrocarbon ventures subsidiary and SK 12.5% each, and the state Office National des Hydrocarbures et des Mines 25% carried interest.

An MD1.5bn ($183.5m) capital increase for Jorf Lasfar Electricity Company (JLEC), owned by Abu Dhabi National Energy Company (Taqa), reminds investors that, even if the economy is under pressure from the government’s huge subsidies bill (mainly for fuel) and the Casablanca bourse has been in the doldrums for several years, the Moroccan market has sufficient depth to mobilise substantial finance for energy and other projects. After the initial public offering (IPO), JLEC’s capital will be MD9bn. The IPO raised MD1bn via the bourse, in Morocco’s biggest IPO since 2008, with 2.2m shares priced at MD447.5 each issued on 10 December.

German development bank KfW has committed a €654m ($884m) loan package for the construction of two solar units at Ouarzazate, the estimated $1.7bn second phase of the Moroccan Agency for Solar Energy (Masen) project to install 500MW at the site.Prequalified bidders for the larger unit Noor II – 200MW – are Spain’s Abengoa group, GDF Suez and Saudi developer Acwa Power, which is building the 160MW first phase at Ouarzazate. These three groups and France’s EDF are also prequalified for the 100MW Noor III project.

The European Investment Bank (EIB) is considering financing the construction of three wind farms: at Midelt in the Atlas Mountains (150MW), near Tangier (100MW) and at Essaouira (200MW) on the Atlantic coast. The projects’ total cost is estimated at €704m ($952m), with the EIB funding coming in the form of a loan to the parastatal Office National de l’Electricité et de l’Eau Potable (ONEE). The EIB has not yet decided the size of its contribution to the projects, which are part of the 850MW second phase of the Moroccan Wind Programme.

Plans by Kosmos Energy and partner Cairn Energy to drill a well next year in a Moroccan-licensed block in the Western Sahara continue to provoke intense interest among oil companies excited by the disputed territory’s offshore potential, as well as political debate among the traditional protagonists. The territory is Moroccan-controlled, but officially under United Nations mandate, and debate centres on a legal opinion issued by UN general counsel Hans Corell in 2002, which stated that exploration and extraction of mineral resources in Western Sahara would be illegal “only if conducted in disregard of the needs and interests of the people of that territory”. This has allowed Morocco’s Office Cherifien des Phosphates to maintain output from its Phosboucraa subsidiary, which is a major employer in the region. However, the Corell judgment – which one official told African Energy, “we’ve all been re-reading recently” – has been generally interpreted as excluding new E&P work.

NYSE-listed Kosmos Energy plans an exploratory well offshore the disputed Western Sahara in 2014, challenging the long-established belief that international resource companies should not explore or develop hydrocarbons or mineral reserves until the former Spanish colony’s future is settled under a United Nations-sponsored process.

A E250m ($344m) loan for the Moroccan Agency for Solar Energy is under appraisal at the European Investment Bank (EIB), for the 200MW second phase of the Ouarzazate concentrated solar power (CSP) complex. This loan would represent 23.5% of the total cost, estimated at E1.06bn. The project – along with solar developments in South Africa – is key to establishing the viability of large-scale solar energy in Africa. Ouarzazate’s planned total 500MW makes it exceptional, and while phase 1 had huge international support, maintaining a high level of affordable international finance is crucial for such a capital intensive and strategically important project, which offers long-term energy security while meeting Morocco’s sustainable development goals. 


With a much-anticipated drilling programme set to test Morocco’s offshore potential, BP has taken a non-operating interest in the adjacent Essaouira Offshore, Foum Assaka Offshore and Tarhazoute Offshore blocks, and will fund Kosmos’ share of the cost of a well in each of them. Tarhazoute was recently converted from a reconnaissance contract. Kosmos described the Agadir Basin as “one of the last remaining underexplored salt basins along the Atlantic Margin”. BP has taken stakes in Kosmos’ acreage offshore from Agadir, but not in its Cap Boujdour Offshore Block, which is within the disputed territory of Western Sahara. Foum Assaka was licensed in 2011 to Kosmos and Pathfinder Hydrocarbon Ventures, now part of Fastnet Oil & Gas, led by John Craven, whose Cove Energy was a highly successful early mover in Mozambique.

The conflict over the former Spanish Sahara is all too often forgotten. But there is a growing feeling in policy circles – shared by companies eager to exploit the territory’s hydrocarbons and mineral potential – that the Western Sahara standoff is overdue a promotion up the international policy agenda. Crisis in the Sahel, where French and African Union forces have confronted jihadist radicals in Mali, has added to pressures to revisit the intractable conflict, more than 40 years since the Polisario Front liberation movement was formed, 38 years since Morocco’s late King Hassan II organised his ‘Green March’ into the territory, and 22 years since a United Nations-sponsored ceasefire was declared.