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Equatorial Guinea has become the 14th member of OPEC on the day the cartel announced a nine-month extension of its November 2016 crude oil production cut. The addition, as reported to Reuters by a source from Guinea’s oil ministry, makes the country the sixth oil producer in Africa to join the organization.
Equatorial Guinea, which is currently the third-largest oil producer in Africa, said back in January that it was looking to join OPEC, which would boost the continent’s overall influence on international oil markets.
The country pumped an average 289,000 bpd in 2015, with reserves estimated in the same year at more than 1.1 billion barrels of crude. It is a relatively new addition to the global oil industry, with the first oil struck in 1996. Over the next ten years, however, the West African nation hit 375,000 bpd, according to The Oil and Gas Year.
The biggest oil deposit in Equatorial Guinea is the Zafiro field complex, with estimated ultimate reserves of 1.2 billion barrels. The country also has gas and condensate reserves, the biggest among them concentrated in the Alba field, estimated to hold more than 5 trillion cu ft of gas.
With a population of less than a million people, Equatorial Guinea gets most of its export revenues from oil and gas, and is determined to further expand these revenues. Last June, it launched a licensing round, the results from which should be announced in early June this year. The first production sharing contracts, according to the country’s mineral resources ministry, should be signed before the year’s end.
The timing of Guinea’s joining the ranks of OPEC is interesting: the source who told Reuters about its admission into the club did not say whether it would participate in the production cut extension. It is, however, likely: OPEC officials have hinted in the past month that more oil producers need to get on board with the cut to maximize its effect.
By Irina Slav for Oilprice.com
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Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry.