Ecuador Joins The EITI

The EITI Board has approved Ecuador’s application to join the EITI, making it the 55th implementing country and the 11th in Latin America.

“EITI implementation can underpin the modernisation of Ecuador’s regulatory framework in the extractive sector, and help ensure that the development potential of extractive revenues is realised,” said EITI Board Chair Helen Clark.

“We welcome Ecuador as an implementing country and look forward to the EITI promoting transparency, accountability, and debate around the management of the country’s natural resource wealth.”

Transparency in a growing sector

Transparency is a fundamental element in the development of a robust extractive sector. Through a sustained approach to accountability, EITI implementation can help make information available to Ecuadorian citizens, and strengthen public understanding on how natural resources revenues are being managed.

Implementing the EITI will require that the Ecuadorian government publicly discloses information on contracts, beneficial owners, revenues and payments, information on state-owned enterprises (SOEs) and data related to gender and environmental payments. These disclosures will support ongoing efforts to publish better, more accessible and more timely data on Ecuador’s extractive sector.

Ecuador is one of Latin America’s most important oil exporters and has a growing mining sector. With an oil production of half a million barrels a day, Ecuador’s extractive industry can provide important revenues for infrastructure and development. Transparency and accountability are key to ensure the country’s resources are managed responsibly.

Yet the COVID-19 pandemic has imposed severe burdens on Ecuador’s public budget. Attracting investment will continue to be a priority for the government and will require it to demonstrate a high level of transparency.

A shared commitment

The government committed to join the EITI in September 2019, noting that EITI implementation would help Ecuador in its pursuit of “transparency and efficiency in managing the natural resources of the country.” 

Civil society organisations have campaigned for Ecuador to join the EITI since 2012. Their continuous engagement, as well as commitment from some of Ecuador’s largest extractive companies, have been instrumental in presenting Ecuador’s candidature application.

Ecuador’s multi-stakeholder group (MSG) – composed of government, industry and civil society representatives – has developed an ambitious Work Plan for the next three years. The engagement of all the stakeholders will be important to ensure that EITI implementation aligns to national priorities and contributes to inclusive development.

Ecuador’s first disclosures according to the 2019 EITI Standard will need to be made within 18 months of being admitted as an EITI implementing country.

EMROD To Showcase World's First Long-Range Wireless Transmission Project

The Africa Energy Forum will host a special presentation on 21st October at 9am (UK time) by EMROD CEO and Founder Greg Kushnir, demonstrating the world's first ever long-range wireless transmission project, currently operating in New Zealand.

EMROD has developed the world's first commercially viable long-range, high-power, wireless power transmission as an alternative to existing copper line technology.

Emrod's technology works by utilising electromagnetic waves to safely and efficiently transmit energy wirelessly over vast distances.

"Being able to transmit high-power electricity without any cables is game-changing for the continent. It means barriers to energy-access are smashed and Africa could be fully electrified within ten years. This is the technology millions of people have been waiting for." Simon Gosling, Managing Director, EnergyNet

The company was founded by serial tech entrepreneur Greg Kushnir, who was determined to find a technology that can reduce power distribution costs, avoid outages and support renewable energy.

"We have an abundance of clean hydro, solar, and wind energy available around the world but there are costly challenges that come with delivering that energy using traditional methods, for example, offshore wind farms or the Cook Strait here in New Zealand requiring underwater cables which are expensive to install and maintain," said Mr Kushnir.

"I wanted to come up with a solution to move all that clean energy around from where it's abundant to where it's needed in a cost-effective, eco-friendly way."

Energy generation and storage methods have progressed tremendously over the last century but energy transmission has remained virtually unchanged since Edison, Siemens, and Westinghouse first introduced electric networks based on copper wires 150 years ago."

By significantly reducing infrastructure costs, Emrod's technology has the capacity to support remote communities such as in Africa and the Pacific Islands by providing access to cheap, sustainable energy to power schools, hospitals and economies.

"The data is compelling. We are talking about a potential 50 per cent increase in sustainable energy uptake, up to 85 per cent reduction in outages and up to 65 per cent reduction in electricity infrastructure costs due to the Emrod solution," said Kushnir.

"Since announcing Emrod's technology we have had a high level of interest from energy distribution and engineering companies from across the globe. We are progressing with some exciting opportunities to improve energy access for remote communities in areas such as India, Africa and Island Nations", added Kushnir.

The company has achieved strong interest from electricity distributors with Powerco, New Zealand's second-largest distributor deciding to invest in a proof of concept of the technology currently operational.

Kushnir commented; "The system we are currently building for Powerco will transmit a few kilowatts but we can use the exact same technology to transmit 100 times more power over much longer distances. Wireless systems using Emrod technology can transmit any amount of power current wired solutions transmit."

EITI Releases New Guidelines To Promote Commodity Trades Transparency

The EITI today released new reporting guidelines for companies buying oil, gas and minerals from governments. The guidelines promote a consistent approach to the disclosure of payments to states or to state-owned enterprises.

The scale and economic significance of payments for these commodities make them a matter of public interest. In-kind payments alone make up almost half of total government revenues declared through the EITI – approximately USD 1.2 trillion to date. Data from leading commodity traders shows that payments for purchases made from governments far exceed tax payments.

The guidelines can be applied by any company in relation to any jurisdiction, but are particularly relevant where oil, gas or minerals are being sold on behalf of the state in countries implementing the EITI Standard.

Together with reporting by governments undertaken in accordance with the 2019 EITI Standard, they enable stakeholders to form a more complete picture of the terms of sale of mining, oil and gas resources. Greater transparency mitigates the risks associated with such trades, which include revenue leakages, misallocation or diversion of revenues, inconsistent terms of trade, conflicts of interest, bribery, corruption and state capture.

Welcoming the guidelines, EITI Board Chair Helen Clark commented: “Commodity trades are essential to the global economy. They play an important role in the global flows of goods that underpin economic growth. These guidelines will help shed more light on the substantial commodity trades involving purchases of oil, gas and minerals from public entities.”

State Secretary Marie-Gabrielle Ineichen-Fleisch, Director of the Swiss Confederation’s State Secretariat for Economic Affairs (SECO) said: “I am delighted that SECO has been able to support the work of the EITI on commodity trading transparency. The guidelines reflect the consensus view of a wide range of stakeholders. I urge all trading companies – including those domiciled in Switzerland – to use the guidelines to build trust in a more transparent and accountable commodity trading sector.”

The EITI’s Working Group on Transparency in Commodity Trading was the driving force behind the guidelines. Participants include representatives of governments, industry, commodity traders and civil society.

The guidelines cover five key steps to data publication. These are: 1) mapping selling entities and transactions; 2) determining the data to be disclosed, including the level of aggregation of the data; 3) providing data assurances; 4) communicating disclosures to selling entities; and 5) determining the way in which data is presented and published. The guidelines also cover two special cases, namely swap sales and resource-backed loans.

The guidelines can be applied with immediate effect and are available, with supporting documentation, on the EITI website.

APICORP Posts $54.8m Net Profit In First Half Of 2020

Gross operating income at USD144.7 million and net income at USD54.8 million despite adverse global conditions; Balance sheet grew by 10% to reach USD8.1 billion; APICORP launched a USD500 million countercyclical support package towards easing the financial pressures of the COVID-19 pandemic and oil price fluctuations in the region.

The Arab Petroleum Investments Corporation (APICORP), a multilateral development financial institution, announced its half-year results for the six months ended 30 June, 2020. Gross operating income for the period stood at USD144.7 million while net profit reached USD54.8 million. While down from the corresponding period last year at 20% and 22%, respectively, the net profit results are notable under the current market conditions due to the COVID-19 pandemic and oil price fluctuations. The revenue was mainly affected by the decrease in dividends from portfolio companies as well as revaluations in the equity investments portfolio due to the pandemic.

Income from APICORP's Treasury and Capital Markets rose to USD60.4 million, a 38% increase compared to the corresponding period of last year. Income over LIBOR from Corporate Banking for the period remained the same as compared to the first half of last year, reaching USD50.3 million. Moreover, the Corporation maintained its annualized efficiency ratio at 25.6% for the period, the same as for the 2019 financial year.

Over the period, APICORP's balance sheet grew 10% to reach USD 8.1 billion, due in large part to the growth in the size of its Treasury and Capital Markets portfolio which was funded mainly by the issuance of a benchmark USD750 million bond in June 2020. This has contributed to APICORP's readiness to fund its future business needs. APICORP also further bolstered its financial sustainability by increasing the share of its liabilities whose maturity is beyond two years to 45% of its total liabilities and shareholders' equity, up from 40% in December 2019.

Commenting on the announcement, Dr. Ahmed Ali Attiga, Chief Executive Officer, APICORP, said: "The results in the first six months of 2020 are a testament to the resilience of APICORP in the face of a tough global business environment. Notwithstanding the triple crisis of COVID-19, oil price volatility and economic downturn, APICORP continued to go from strength to strength, further bolstering its financial position and diversifying its portfolio as it continues its drive to support the energy transition in the region. This includes a historic callable capital increase, a highly successful benchmark bond issuance, a USD500 million countercyclical support package, being assigned a second rating of 'AA' with a stable outlook from Fitch, as well as forging new partnerships with other leaders in key projects within the energy space."

"We are looking forward to the coming period for a gradual recovery in our operating environment and the new opportunities it will bring. As the trusted financial partner to the MENA region's energy industry, we will continue to support our Member Countries and partners to alleviate the impact of COVID-19, with a focus on sustainable impact-driven energy projects and activities in the region," Dr. Attiga added.

Dr. Sherif Ayoub, Chief Financial Officer, APICORP, said: "The robust financial and risk metrics, as well as profit-generating ability during challenging times of the first half of 2020, demonstrate APICORP's ability to navigate unprecedented economic challenges. In particular, the liquidity metrics have shown tremendous resilience to withstand market shocks due, in part, to our deep and diverse funding base, while the capital adequacy ratio of 29.2% reflects the high-quality nature of our portfolio."

Highlights from 1H2020

Highlights from the first half of the year include a landmark increase in APICORP's callable capital to USD8.5 billion, as well as the largest-ever increase in authorized capital and subscribed capital to USD20 billion and USD10 billion, respectively.

APICORP was assigned an 'AA' rating with a stable outlook by Fitch and had its 'Aa2' rating with a stable outlook affirmed by Moody's, becoming the only financial institution in MENA currently to hold these two ratings. This is a testament of APICORP's ability to execute its important public mandate in the strategic and vital energy sector within its Member Countries, and beyond. Moreover, it reflects the multilateral's strong financial fundamentals and resilience despite current economic and market conditions.

APICORP launched a USD500 million countercyclical support package in April 2020 aimed at easing the financial pressures of the COVID-19 pandemic and oil price fluctuations on the region's energy sector. The package is being deployed to support sustainable impact-driven projects by extending funding for projects and working capital within various energy sub-sectors, as well as expanding trade finance support to its Member Countries to reduce the fiscal and current account pressures caused by current market conditions.

APICORP issued a benchmark USD750 million dollar-denominated bond in June which attracted robust and diverse investor demand. At 1.46%, the five-year note's fixed cost of funding was the lowest in the history of the Corporation.

APICORP acquired a 20% equity stake in Jordan Wind Project Company, owner and operator of the Tafila Wind Farm, the first utility-scale wind farm in MENA. The acquisition, the Corporation's first equity investment both in Jordan and in a wind farm venture, will contribute to wider deployment of the region's vast renewable energy sources to enable wider access to modern cost-effective electricity to millions of people.

On the financing side, the Corporation provided USD40 million in financing to the USD245 million state-of-the-art Dammam Independent Sewage Treatment Plant (ISTP), the first ISTP in Saudi Arabia, a key project that will help underpin the sustainability of the national utilities network. Besides, boasting world-class and energy-efficient facilities, the project is expected to create job opportunities for Saudis and support overall sustainable development within the Kingdom.

EITI Appoints Bady Baldé As EITI Executive Director

EITI’s Africa Director, Bady Baldé, has been appointed as its Deputy Executive Director. Going forward, he will combine the roles of Africa and Deputy Executive Director. 
 
Baldé joined the EITI in 2009 and has progressively assumed more responsibilities for the EITI’s technical, country and policy work. 

As Africa Director, he currently oversees the International Secretariat’s work in 24 implementing countries in Africa. He also works on several major policy areas. On commodity trading transparency, for example, he has been instrumental in developing EITI transparency requirements and the establishment of the commodity trading working group. 

Mark Robinson, EITI’s Executive Director, commented:
 
“I am delighted that Bady will take up the role of Deputy Executive Director at the EITI International Secretariat. Bady is an accomplished speaker and strategist, whose skills and substantial country experience will take the EITI forward, as it continues to raise the bar on extractives transparency.”  
 
Bady Baldé said: 
 
“Taking on this role at such an exciting time in EITI’s history is a challenge I will relish. Implementing the 2019 Standard requires a real step change in the level of support that the EITI International Secretariat offers to implementing countries. In parallel, we are seeking to integrate reporting into government and company systems in a way that will provide a new level of transparency in the industry.”
 
Before joining the Secretariat, Baldé worked at the Central Bank of Guinea, the German Development Corporation and as a Consultant at the World Bank. In 2012, Baldé was seconded as an expert in Natural Resources Governance in the Governance, Economic Reforms and Financial Management Department of the African Development Bank in Tunis.
 
He holds a Master's Degree in Public Administration in International Development from the Harvard University Kennedy School of Government and a Maîtrise en Gestion des Entreprises from the University of Conakry. Baldé is married with two children and lives in Norway.

OPEC, Non OPEC Members To Focus On Energy Poverty

Global oil producers will convene Friday in Vienna, Austria for the 177th OPEC Meeting. Through the meeting, the producers are aiming to determine the management of oil production in 2020.

The African Energy Chamber urges African OPEC and non-OPEC members to commit to the Declaration of Cooperation and ensure compliance. This is of key importance as it keeps the path to dignity and prosperity for African economies open.

The meeting falls amidst the climate change debate which has put pressure the global energy industry to implement less carbon-intensive energy solutions.

Attending the 177th Meeting, the Africans see this gathering as an opportunity for OPEC members to focus on the realities of energy poverty on the African continent and provide a solution that allows Africa to still meet its objectives of improving power access and building competing economies while participating in the dialogue about addressing climate change.

“Climate change is real. At the African Energy Chamber, we do not reject its existence and impact on the environment, instead, we are determined to express the importance of Africa’s progress not being halted particularly when it is progressing towards its summit,” said NJ Ayuk, Executive Chairman of the African Energy Chamber and author of Amazon best-seller, Billions at Play: The Future of African Energy and Doing Deals.

“There must be a dialogue between businesses and governments about the future of the global energy industry, but, African business must be on the table. Accounting for 7.3 percent of global oil reserves and 7.2 percent of global gas reserves, Africa should have a voice” added Ayuk.

Last week, the African Energy Chamber launched a petition against the proposition that in the wake of the climate change debate, Africa should limit the development and exploration of its full hydrocarbon potential. This, it has done not as a means to reject the realities of climate change, but rather as a plea to be given the same opportunity as our western counterparts to develop and industrialize our countries.

In tune with the African Energy Chamber’s plea for a gradual energy transition that does not enforce a swift change from one source to another, H.E. Mohammad Sanusi Barkindo, Secretary General of OPEC said earlier this year that: “The oil industry must be part of the solution to the climate change challenge. The scale of the challenge means that no single energy source is a panacea; nor can the contribution of an entire industry or group of countries be overlooked. This is not a race to renewables alone; it’s a race to lower greenhouse gas emissions.”

Firm Announces Multiple Contract Awards In Saudi Arabia

National Energy Services Reunited Corp., a national, industry-leading provider of integrated energy services in the Middle East and North Africa and Asia Pacific regions, reported awards valued up to 2.5 Billion Saudi Riyal ($660 Million) for Coiled Tubing & N2, Stimulation Services and Cementing Services for a period of five (5) years with possible extensions of up to 2 years with the National Petroleum Technology Company, a subsidiary of NESR.

Dr. Mohammed Y. Al-Qahtani, Senior Vice President for Upstream, Saudi Aramco commented: “NESR is a key partner for Saudi Aramco, and we are very pleased to see National Petroleum Technology Company, a subsidiary of NESR, progress in such a short span of time. As we have previously stated, we would like to see local high- caliber firms from Saudi Arabia that have proven their ability to handle complex projects to step up and take a larger role to help achieve Saudi Aramco’s In-Kingdom Total Value Add Program (IKTVA) goals, which aim to increase the company’s locally sourced goods and services to 70 percent by 2021 and contribute to the Vision 2030, Saudi Arabia’s national transformational program. With these awards, we would also like to see NESR introduce innovative technologies to address our challenges.”

“These awards are key as they provide a baseline for our growing operations in Saudi Arabia” said Sherif Foda, Chairman of the Board and CEO of NESR. “We are very grateful to Saudi Aramco for reposing their faith in us. As a premier national service provider, we have made significant investments in training and developing the national workforce in Saudi Arabia to deliver top level service quality. At NESR, we are committed to playing a positive role in the development of the communities in which we operate and that drives our commitment to leadership in IKTVA. These contracts allow us to grow our investments in our ongoing initiatives in Saudi Arabia.”

 

OPEC Fund For International Development Launches New Strategy

OFID’s highest policy-making body, the Ministerial Council, held its 40th Annual Session in Vienna, Austria, and approved the general principles of OFID’s new Strategic Framework.

The new strategy affirms OFID’s commitment to providing support to developing countries – especially low-income countries – in an increasingly complex and challenging development landscape.

At the Ministerial Council meeting, OFID Director-General Dr Abdulhamid Alkhalifa said: “OFID’s vision is to be a relevant, agile and efficient development finance institution that can deliver maximum development impact to its partner countries while becoming self-sustainable in financing its operations.”

Over the coming months, OFID will embark on a journey to diversify its financial resources and to implement a coherent and consistent set of actions aimed at creating greater efficiency throughout the institution and equipping it with more innovative and responsive operational and financial instruments.

As part of its new strategy, OFID will renew its focus on partnerships. OFID works closely with organizations such as the World Bank, regional development banks and the bilateral and multilateral agencies of OFID member countries, as well as specialized agencies of the United Nations.

In addition to strengthening existing partnerships, OFID aims to form new relationships to revitalize the global partnership in support of sustainable development.

In keeping with previous years, a highlight of the Ministerial Council’s public session was the presentation of the OFID Annual Award for Development.

The 2019 Award was bestowed on Vida Duti – Country Director of the IRC International Water and Sanitation Centre in Ghana – in recognition of her remarkable work and engagement in ensuring sustainable water, sanitation and hygiene (WASH) services for the population of Ghana (see press release PR14).

The Ministerial Council also considered and approved OFID’s financial statements and 2018 Annual Report, which shows cumulative commitments to global development exceeding US$23.4 billion.

OFID aims to continue to support the global efforts to overcome development challenges, as it has done since 1976, by: extending concessionary financial assistance; participating in the financing of private sector activities in developing countries; contributing to the resources of other development institutions. Since it was established, the organization has improved its capabilities and operational reach to support South-South development and socioeconomic growth in partner countries around the world. Public Sector lending, including to low-income countries, will continue to represent the largest portion of OFID’s loan portfolio, going forward.

The Ministerial Council comprises the finance ministers and other high-level representatives of OFID Member Countries. It meets once a year.

Uganda Mourns IAEA Boss’s Death

The Minister of Energy and Mineral Development, Eng. Irene Muloni, has expressed utter shock at the news that the Director General of the International Atomic Energy Agency (IAEA), Yukiya Amano, had passed on.

The agency’s secretariat Monday announced the death of the Japanese official

 “I’m really very shocked! It’s a pity that we have lost a very great committed man. He was very instrumental in helping us as a country to bring in the cobalt 60 Cancer Treatment Machine and seeing Uganda realise its full potential of using nuclear energy for peaceful purposes,” said Muloni.

Ms. Sarah Nafuna, the Head Nuclear Unit at the Ministry of Energy and the National Liaison officer to the IAEA also expressed her sincere regrets at the death of the Director General.

“We shall miss our DG (Director General of IAEA). His support to the development of Uganda’s Nuclear Power Project for peaceful purposes and acquiring the Cancer Treatment Machine at Uganda Cancer Institute was very key to our country. He even attended its commissioning,” recalled Nafuna.

Amano met the president early in January 2018 ahead of the commissioning of the Cobalt 60 cancer machine at Uganda Cancer Institute, Mulago. At the meeting at State House, President Yoweri Museveni stressed the importance of peaceful use of nuclear both in resolving Africa’s energy needs and on health matters.

Barkindo OPEC Reappointment Good For Global Oil Markets Stability

The African Energy Chamber has saluted the re-appointment of H.E. Mohammed Barkindo as Secretary General of OPEC and is looks at it as a factor of stability for African and global oil markets.

Secretary General Barkindo has managed to keep OPEC united as an organization under very unstable times and a deep crisis in commodity prices. His leadership and diplomacy has restored market stability and successfully sealed landmark agreements like that of the Declaration of Cooperation between OPEC and non-OPEC member countries.

More importantly for our continent, it is under Secretary General Barkindo that OPEC gained its two newest African members, Equatorial Guinea in 2017 and the Republic of Congo in 2018. Last year, he was awarded the Africa Oil Man of the Year award by Africa Oil & Power for prioritizing of cooperation in turbulent times, for stabilizing oil markets and for raising the voice of Africa on the global energy stage.

“The extension of H.E. Mohammed Barkindo’s mandate as Secretary General for another term is excellent news. It is well-deserved and a result of the trust he has gained from the entire global energy community,” declared NJ Ayuk, Executive Chairman of the Chamber and CEO of the Centurion Law Group.

“Secretary Barkindo has maintained faith in the future of the oil & gas industry, he picks the right battles and fights them with courage. As the race towards stability continues, his sense of team work will continue building the bridges our industry needs to achieve greater prosperity.”
 

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