Equatorial Guinea, Burkina Faso Agree LNG Supply and Sales Pact

LAGOS (Capital Markets in Africa) – Equatorial Guinea said it signed a memorandum of understanding with Burkina Faso to supply the West African nation with liquefied natural gas and build infrastructure to import, store and transport the fuel.

The initial three-year agreement compels both sides to negotiate and sign an LNG supply agreement and a terminal use deal, Equatorial Guinea’s Ministry of Mines, Industry and Energy said in an emailed statement on Monday. The countries will work to build regasification and storage terminals in Burkina Faso as well as transport infrastructure, the ministry said.

Equatorial Guinea is increasing LNG output as declining oil production weighs on the central African nation’s finances. As a start of projects from Australia to the U.S. has led to a glut of the fuel that’s likely to remain into the next decade, Equatorial Guinea is targeting sales to nearby states in Africa where chronic energy shortages are curtailing economic growth.

“This collaboration with Burkina Faso, part of our LNG 2 Africa initiative, highlights the important responsibility of African countries to cooperate in the energy sector and build the necessary infrastructure to strengthen our economies,” the energy ministry said.

Source: Bloomberg Business News