Lukoil, Russia’s largest oil producer and owned by Russian billionaire Vagit Alekperov, has increased its foothold in West Africa by acquiring three exploratory offshore blocks in the Gulf of Guinea.
This plan, which aims to strengthen Lukoil’s position in the region, entails purchasing a 56.6 percent share in each block from US company Vanco Energy. The blocks, CI-101 and CI-401 in Ivory Coast waters, and the Cape Three Points Deep Water block in Ghana, cover 15,000 square kilometers of the deep-water Tano oil and gas basin.
Lukoil Overseas President Andrei Kuzyaev emphasized the importance of these projects, saying,
“The projects are of special interest to us, as they significantly diversify our business of reinforcing and developing the company’s position in West Africa,” according to him.
Last year, Lukoil purchased a 63 percent share in Ivory Coast offshore block CI-205, which is located near the country’s largest oil well, Baobab.
Petroci Holding, a state-owned company in the Ivory Coast, owns 15% of blocks CI-101 and CI-404, while Ghana’s National Petroleum Company owns 15% of the Cape Three Points Deep Water block. Lukoil, which produces more than 1.9 million barrels of oil per day largely in Russia, is the most active Russian oil company overseas, with exploration and production operations in Egypt, Venezuela, Columbia, Saudi Arabia, and Iran.
A Production Sharing Agreement, signed in 2005, governs the exploration of CI-101 and CI-404. This deal provides for a 5.5-year exploring period. The Cape Three Points Deep Water Block is being developed under a 2002 agreement that includes a seven-year exploration phase. These long-term agreements demonstrate Lukoil’s determination to growing its foreign activities and entering the profitable West African oil and gas market.
With ConocoPhillips owning a 20% share in Lukoil, the Russian oil behemoth is expanding its global influence. The new acquisition in the Gulf of Guinea is part of Lukoil’s larger goal to diversify and expand its activities while maintaining a strong presence in important foreign markets.
Alekperov, a key shareholder in Lukoil, makes the majority of his fortune from his 28.3% interest in the firm. Lukoil, a publicly listed oil and gas business headquartered in Moscow, recorded $86.3 billion in sales in 2023, employs over 100,000 people, and accounts for around 2% of global oil output.