Marathon Oil is set to move ahead with the further development of the Equatorial Guinea Regional Gas Mega Hub (GMH) by progressing the next two phases.
In this connection, the US-based oil and gas firm has signed a heads of agreement (HOA) through its affiliate Marathon E.G. with the government of Equatorial Guinea (E.G.) and Noble Energy E.G., a Chevron company.
Phase 1 of the Equatorial Guinea Regional Gas Mega Hub was executed by establishing a tieback of the Alen field located in Block O, off the east coast of Bioko Island, to the onshore facilities in Punta Europa.
The first gas from phase 1 was delivered in February 2021.
Marathon Oil chairman, president, and CEO Lee Tillman said: “We are excited about this critical milestone in the ongoing development of Punta Europa as a world-class hub for the monetization of local and regional natural gas.
“This announcement builds on our successful partnership of more than 20 years with the E.G. Government, further leveraging and extending the life of E.G.’s world-class gas monetization infrastructure, including the critical E.G. LNG facility, into the next decade.”
Gas from the Alen field is processed under a mix of a tolling and profit-sharing arrangement through the onshore liquified petroleum gas (LPG) plant of Alba Plant and Equatorial Guinea LNG’s LNG facility. Marathon Oil holds ownership stakes in both the facilities.
Phase 2 calls for the processing of gas from the Alba Unit from 1 January 2024, under new contractual terms. This will be after the expiration of the legacy Henry Hub-linked Alba sales and purchase agreement at the end of 2023.
According to Marathon Oil, phase 2 of the Equatorial Guinea Regional Gas Mega Hub will substantially grow the company’s exposure to global LNG pricing. Besides, it is expected to significantly boost its earnings and cash flow in Equatorial Guinea.
Phase 3 of the gas hub is anticipated to enable gas processing from the Aseng field at Punta Europa facilities.
