Equatorial Guinea in Talks with Trafigura for $2 Billion Oil Financing

Equatorial Guinea says it held talks with Trafigura Group for the potential for $2 billion in financing from the commodity dealer to assist growth of the nation’s hydrocarbon sector.

Trafigura final week “proposed a mortgage” throughout talks with authorities officers together with Vice President Teodoro Nguema Obiang Mangue, based on a July 31 assertion from the federal government. 

Trafigura declined to touch upon Tuesday. The press workplace of the vice chairman referred to the federal government assertion and in any other case declined to remark. Equatorial Guinea’s minister of mines and hydrocarbons, Antonio Oburu Ondo, didn’t instantly reply a name and e-mail in search of remark.

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A deal could not come to fruition, and the phrases of any potential settlement aren’t but clear. 

Nevertheless, the discussions spotlight how money and revenue-strapped African nations are turning to merchants for funding to spice up producing belongings and power provides. Gunvor Group not too long ago financed Gabon’s deal to purchase crude producer Assala Power for about $800 million, whereas Vitol is turning into the only real provider of oil merchandise to Uganda.

In Equatorial Guinea, state-owned oil and gasoline firm GEPetrol not too long ago took full management of the Zafiro oil subject after the departure of power main Exxon Mobil Corp. The nation is a member of the Group of the Petroleum Exporting International locations.

Its oil increase enriched the ruling elite, together with President Teodoro Obiang Nguema Mbasogo, the vice chairman’s father, who seized energy in 1979. He established political ties with the US and gave the nation one of many highest charges of gross home product per capita in Africa. But after a long time of oil manufacturing, Equatorial Guinea has among the continent’s worst social indicators and a poor human rights document.

Exxon mentioned earlier this yr that it could switch investments within the nation to the federal government after a resolution to go away that was in line with its long-term technique. GEPEtrol contracted Petrofac in April to assist its operations.

The vice chairman has really useful that the federal government and the commodities dealer transfer towards a memorandum of understanding, based on the assertion.