Sonagas, Equatorial Guinea's state gas company is in negotiations to partner with Eon Ruhrgas, the German utility for a second LNG export facility in Equatorial Guinea project creating a West African gas hub. It is likely that a consortium will be set-up comprising of Sonagas, Eon, Union Fenosa of Spain and Portugal's Galp Energia.
Taking advantage of West Africa as a potential route to Europe and amidst instability dependence on Russia gas, the project is expected to get a strong push factor. It is likely that the source gas will be from gas currently flared as waste by ExxonMobil at the Zafiro deepwater oilfield.
The consortium is however exposed to a major risk as Equatorial Guinea is one of Africa's most volatile country due to local uprising.
Huge offshore oil discoveries have boosted Equatorial Guinea's oil production from almost nothing a decade ago to about 380,000 b/d, ranking it behind only Nigeria and Angola among sub-Saharan African producers.
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