As part of early efforts to mitigate the oil price drop caused by the coronavirus pandemic, Equatorial Guinea’s Ministry of Mines and Hydrocarbons (MMH) decided on the waiving of its fees for services companies in the country. Oil prices currently remain at around $20 a barrel, the country’s lowest level since 1991. This move also supports Equatorial Guinea’s service industries, whilst engaging on an industry-wide dialogue to study other measures for upstream operators and ongoing midstream projects
“The Ministry of Mines and Hydrocarbons took the unanimous decision to waive its fees for services companies for a duration of three months,” declared H.E. Gabriel Mbaga Obiang Lima, Minister of Mines and Hydrocarbons. “We recognize that the oil sector continues to be the largest private-sector employer in the country and want to give our local services companies the means to weather the storm and avoid any jobs being lost.
While it is important to let market forces determine the future, the government does have a role to play in stimulating the market and creating an environment for these companies to stay strong, continue investing and create opportunities for our citizens,” he added.
Jobs security and the safety of Equatorial Guinea’s citizens have been put at the top of priorities for the MMH, which has further pledged to keep engaging with local and international companies to create the right kind of enabling environment for the sector to operate and grow despite current circumstances.
International operators will need to keep complying with local content requirements in Equatorial Guinea throughout the downturn and make sure to work with the local services industry to adapt to new market dynamics. This is the first such measure to be taken in Equatorial Guinea, which will consider additional action to bring relief to its oil & gas sector.
The ongoing coronavirus pandemic has brought the world economy to a halt and critically affected oil demand. As a result, prices have been brought to their lowest levels since 1991, which brings considerable instability to African oil producers in the Gulf of Guinea.
