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Has a new trend of co-operation replaced confrontation in the management of maritime borders in north-west Africa? Morocco and Spain are synchronising controversial exploration around the popular holiday destination of the Canary Islands, separating their interests by a ‘courtesy corridor’ inside which neither country can operate. Libya and Malta have also decided to jointly explore the disputed area of the Medina Bank. The Canaries archipelago could contain up to 1.4bn bbls of oil in fields capable of producing up to 140,000 b/d. The islands’ President Paulino Rivero has previously criticised Spanish central government plans to explore near Lanzarote and Fuerteventura as incompatible with tourism on the islands.

San Leon Energy has signed a memorandum of understanding with the Office National des Hydrocarbures et des Mines giving it exclusive rights to a 36km2 block in the Timahdit oil shale deposit for two years. San Leon will evaluate the commercial viability of a production project using a surface retorting process.

The European Investment Bank invested €1.41bn in North Africa in 2012, according to vice-president in charge of the Facility for Euro-Mediterranean Investment and Partnership (Femip), Philippe de Fontaine Vive. Morocco took the lion’s share of this with €1bn, of which €180m was spent on the third phase of the country’s 2012-15 energy access programme. The programme aims to reduce power losses, connect new power plants to the grid, and install 1,300km of transmission lines. The EIB is providing €100m for the construction of the 125-160MW Ouarzazate concentrated solar power (CSP) project, the largest to date under the Mediterranean Solar Plan, alongside the European Commission (€30m), the AFD (€100m) and KfW (€115m).

A political standoff in Morocco which has meant coalition member Istiqlal leaving the government, is more likely to see the largest party, the moderate Islamist Parti de la Justice et du Développement (PJD), bringing in another partner, rather than elections being held early. As horse-trading continues among the political elite, with King Mohammed VI looking on, the most likely partner is a ‘loyalist’ party that finished a surprising third in the 2011 general election, the Rassemblement National des Indépendants (RNI).

The European Investment Bank (EIB) has earmarked €3.65bn ($4.77bn) in loans to be disbursed to Africa, Caribbean and Pacific (ACP) states between 2014 and 2020, with sub-Saharan Africa a major beneficiary. Speaking to African Energy during the annual visit of ambassadors of ACP partner countries to the Bank’s Luxembourg headquarters, EIB vice-president for sub-Saharan Africa Pim van Ballekom praised recent African growth, saying: “Investing in Africa is good for Africa, of course, but also for European industries.” The €3.65bn includes €1.13bn from the European Commission, under the EIB-managed ACP-EU Investment Facility, for technical assistance programmes or interest rate subsidies. The other €2.5bn will come from the EIB’s own resources.

The project to build a 1,320MW coal-fired baseload plant at Safi is moving ahead – with the prospect of financial close by year-end – following the start of work on an essential parallel project, building a new port to provide a hub for industrial giant Office Chérifien des Phosphates and facilities to import the estimated 3.5m t/yr of coal that will fuel the power plant being developed by GDF Suez and the local Nareva Holding.

AIM-listed explorer Fastnet Oil and Gas, set up by former Cove Energy directors, has farmed into the onshore Tendrara Lakbir licence. Fastnet’s Moroccan subsidiary Pathfinder Hydrocarbon Ventures Limited will acquire a 37.5% stake from Moroccan explorer Oil and Gas Investments Funds (OGIF). Fastnet will fund an appraisal well on the 2006 TE-5 gas discovery to be drilled by end-February 2014.

Work on one of Morocco’s five giant solar power complexes got under way on 10 May as Saudi Arabia’s Acwa Power launched construction of the 160MW first phase of a possible 500MW complex in Ouarzazate. The Noor 1 concentrated solar power (CSP) facility is being developed as the first project for the Moroccan Agency for Solar Energy (Masen) and reaffirms the dominance of Gulf-owned companies in North Africa. Noor 1 will incorporate three hours of thermal storage and will be the world’s largest parabolic trough CSP power plant, according to Acwa. Prequalification for the 300MW second phase, divided into a 100MW CSP tower and 200MW parabolic trough project, began in January.



The World Bank’s International Finance Corporation (IFC) is considering debt financing to fund the exploration and development of Circle Oil’s operated assets in Morocco and non-operated assets in Egypt and Tunisia. The loan proposal is due to go to the IFC board on 21 June. In its 2012 results announced on 13 May, Circle reported revenue of $73.3m, up 26% over 2011, and cash from operations of $39.3m, up 243% year on year, helped by increased production of Egyptian oil and Moroccan gas, higher market prices, and improved payment receipts from Egyptian General Petroleum Corporation. Libya Oil Holdings (LOH)’s 17.75% shareholding in Circle has been frozen since March 2011. Ahmed Kashadah, the head of the Libyan African Portfolio which owns LOH, has asked for the Portfolio’s assets to remain frozen as it is not ready to take on LOH’s management.

London-listed Genel Energy has signed a drilling rig contract with Noble Corporation for the Noble Paul Romano deep-water semisubmersible rig. The rig will be used for a two-year drilling programme, starting in Q4 2013. The rig has a rated water depth of up to 1,800 metres and a drilling depth of 7,500 metres. AGR will be providing drilling management services.

Cairn Energy has announced a long-term contract with Transocean for the Cajun Express semisubmersible drilling unit. The rig, which is on an initial one-year contract, will start work in Morocco on the Foum Draa Block, where a well is planned in H2 launching a two to four well programme on the company’s six blocks in 2013/14 . Cairn said it would also be used in Senegal, where a well is planned in early 2014, and potentially other areas.

Following the success of its investment in Ugandan electricity distributor Umeme and ahead of the launch of its next African energy-focused investment fund, UK private equity investor Actis Capital has moved to buy Veolia Environnement’s water, wastewater and electricity services concessions in Rabat, operated by the French group’s concession company Redal, and its Amendis subsidiary’s operations in Tangier and Tetouan.

Companies exploring in Morocco plan to drill around ten offshore exploration wells in 2013-14 as interest in the country’s exploration potential increases. Morocco has seen a brisk pace of farm-ins and new licensing in recent months, with Chevron taking three blocks in January , Portugal’s Galp Energia farming into Tangiers Petroleum’s Tarfaya Offshore licence in December , and Tony Hayward’s Genel Energy acquiring stakes in three blocks.

The Islamic Development Bank signed a $200m loan agreement on 11 February to support the construction of the 45MW M’Dez and 125MW El Menzel hydroelectric power stations. The two plants form the M’Dez El Menzel complex, which is a key development for the Upper Sebou River.

GDF Suez, in partnership with Morocco’s Nareva Holding, has won a contract to build the 300MW Tarfaya wind farm. The Tarfaya farm will be developed on a build, own, operate, transfer basis and supply electricity to state utility Office National de l’Electricité et de l’Eau Potable under a 20-year power purchase agreement.