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Glencore puts Chadian oil fields up for sale

The sale is being jointly run by U.S. bank, Morgan Stanley and French bank Natixis.

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Glencore puts Chadian oilfields up for sale

Like its oil trading peers, Glencore expanded in the upstream sector about a decade ago in order to secure oil flows, but the value of the assets tumbled with the oil price slump in late 2014. 

News of the Chad oilfields sale coincides with the retirement of Glencore’s head of oil, Alex Beard at the end of this month and the separation of its upstream oil interests from marketing. 

The main producing fields are Mangara and Badila. 

Related: Chad Suspends Import Taxes on Food

Glencore’s net oil production from the West African country accounted for more than half its net production at 7,700 barrels per day (bpd) out of a total net 12,700 bpd. By comparison, oil majors, BP produces close to 4 million barrels of oil equivalent per day. 

According to Glencore, the assets, up for sale less than a month ago and a data room including drilling and seismic details, had recently been opened.

The sale is being jointly run by U.S. bank, Morgan Stanley and French bank Natixis. 

A spokesman for Glencore declined to comment. Morgan Stanley declined to comment and Natixis did not immediately comment. 

Glencore was started by trader, Marc Rich more than 40 years ago specializing in oil trading. 

Over the past 20 years, it expanded into coal and metals mining but oil production constituted a small part of its business. Oil trading meanwhile, grew to 5 million barrels per day, making Glencore the world’s second-largest oil trader. 

Related: Tanzania, Zambia plan $1.5 billion oil products pipeline

It entered Chad in 2012 by buying minority stakes in some licenses owned by Calgary-based Caracal Energy and in 2014, the miner acquired the Chad-focused operator for $1.6 billion. 

However, the purchase was ill-timed taking place just months before a major oil price slump and since 2015, Glencore has booked impairments of $1.9 billion on its Chad assets after it scaled back its development program and froze drilling between early 2016 and the second half of 2017. 

In its 2018 report, Glencore says the recoverable value of its Chad assets was $1.2 billion and gross production was around 10,500 barrels per day. In total, Glencore’s upstream gross production was 35,000 bpd. 

Glencore has also booked impairments at its assets in Equatorial Guinea, though partially recovered, and in Cameroon. The company also holds an interest in Russian upstream company Russneft.

Related: Comoros oil boom dream hinges on seismic survey

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Uganda and Rwanda revisit trade talks

The meeting was aimed at boosting diplomatic relations between the two East African neighbours

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Uganda and Rwanda revisit trade talks

Officials from Uganda and Rwanda on Monday met in Kigali following a Memorandum of Understanding signed by the two countries in Angola in August.

The meeting was aimed at boosting diplomatic relations between the two East African neighbours.

The two sides were seen to be at loggerheads for some time earlier this year, culminating in the closure of their borders.

The August MoU included agreements on regional co-operation and security, setting the pace for the improvement of political and trade relations between Uganda and Rwanda.

The two leaders also agreed to “resume as soon as possible the cross-border activities between both countries, including the movement of persons and goods, for the development and improvement of the lives of their population”.

The Ugandan delegation is led by Foreign Affairs minister, Sam Kutesa while his counterpart in Rwanda spearheads the opposite delegation.

Angola and DR Congo played a key role in bringing the Ugandan and Rwandan sides to the negotiating table.

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Egypt resumes Nile Dam talks with Ethiopia, Sudan

Egyptian Foreign Minister, Sameh Shoukry has expressed unease in recent days over delays in negotiations

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Egypt resumes Nile Dam talks with Ethiopia, Sudan

Egypt says Ethiopia has “summarily rejected” its plan for key aspects of operating a giant dam. The country is building on the Nile, while dismissing Ethiopia’s own proposal as “unfair and inequitable”.

The comments, made in a note circulated to diplomats last week, show the gap between the two countries on a project seen as an existential threat by Egypt, which gets around 90% of its freshwater from the Nile. 

The note distributed by the Egyptian foreign ministry, a copy of which was seen by reporters, points to key differences over the annual flow of water that should be guaranteed to Egypt and how to manage flows during droughts. 

It comes as Egypt, Ethiopia and Sudan met on Sunday and Monday for their first talks over the hydroelectric dam in more than a year. A spokesperson at Ethiopia’s foreign ministry, Nebiat Getachew, said on Monday the meeting had so far produced no agreements or disagreements, and gave no immediate response to the Egyptian claims. 

Egyptian officials were not immediately available for comment, but after the talks, an Egyptian water ministry statement carried by local media said the meeting had been limited to procedural, rather than substantive issues. 

Egyptian Foreign Minister, Sameh Shoukry has expressed unease in recent days over delays in negotiations. 

The $4 billion Grand Ethiopian Renaissance Dam (GERD) was announced in 2011 and is designed to be the centrepiece of Ethiopia’s bid to become Africa’s biggest power exporter, generating more than 6,000 megawatts. 

In January, Ethiopia’s water and energy minister said that following construction delays, the dam would start production by the end of 2020 and be fully operational by 2022.

The dam promises economic benefits for Ethiopia and Sudan, but Egypt fears it will restrict already stretched supplies from the Nile, which it uses for drinking water, agriculture and industry.

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Tanzanian mining firms to pay royalty fees on mineral production

The Tanzania Mining Commission set a deadline of September 15 to enforce the directive

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Tanzanian mining firms to pay royalty fees on mineral production

Mining companies in Tanzania risk being denied transport permits to ferry their products if they have not adhered to section 18 of the country’s Mining Act of 2010 (and revised in 2017), which requires all producers pay royalty fees on the gross value of minerals produced.

The Tanzania Mining Commission set a deadline of September 15 to enforce the directive.

The issue came up when Tancoal Energy Ltd. claimed that the law was punitive and would make its products expensive. However, the permanent secretary in the Ministry of Minerals, Simon Msanjila, says that the royalty fees have been in effect since 2010 and other companies producing coal and other minerals were already applying it.

“Tancoal have been avoiding paying the fees all these years, despite expanding their coal exports portfolio to include clients outside the country,” said Prof Msanjila. He further added that “it’s about time they start paying as well.”

The law requires every authorised miner in Tanzania to pay royalty fees based on the gross value of their produce. The gross value is the market value of the minerals at the point of refining or sale.

Violation of the directive results in up to two years imprisonment, maximum Tsh10 million fine in the case of an individual, or Tsh50 million fine for a corporate.

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