Continental Focus, International Reach

Gabon Works on Attractive Contract Terms

Thursday, November 29, 2018

The government of Gabon is working on adding a series of attractive terms for its current oil and gas contracts. Gabon recently launched a call for tenders for 23 blocks in deep water and 11 blocks in shallow waters during Africa Oil Week held in Cape Town in early November. The new terms are designed to attract explorers and ease working conditions in the country.

These conditions will be included in the new petroleum code. However, the timetable for drafting the code could be delayed by parliamentary obstacles and a presidential power vacuum, according to The Petroleum Economist.

The implementation of the new petroleum code is seen as an important key to the success of the licensing round and the ramp-up of production in the country, which has been declining over the years.

According to reports the new code could reduce an energy company’s tax by 35%, a minimum rate royalty rate of 7% for conventional offshore oil and 4% for gas. For deep and ultra-deep waters, royalty rates of 5% for oil and 2% for gas were mirrored by Libreville.

Be sure to read Petroleum Africa’s November issue for an in-depth look at the licensing round and planned government reforms for the sector.