Russian oil giant tests West African waters

Russian oil giant tests West African waters

The U.S. and China have been vying for West Africa’s sizable and largely untapped oil reserves for years, but less well-known has been Russia’s growing interest in the region:

The president of LUKoil Overseas, Andrei Kuzyayev, met Ghana’s energy minister, Joe Oteng Adjei, for discussions about the expansion of the company in Ghana, including the development of new projects, according to the latest corporate newsletter, Neftyanie Vedomosti. After leaving Ghana, Kuzyayev held talks in the capital of Sierra Leone, Freetown, and LUKoil Overseas senior vice president Dmitry Timoshenko visited Liberia’s capital of Monrovia.

Countries like Sierra Leone and Liberia, “which have just come through terrible civil wars … are today, with the interest of foreign investors, quickly resurrecting their shattered economies,” the company’s publication said.[…]

The West African continental shelf is an interesting prospect for many international companies, said Valery Nesterov, an oil analyst at Troika Dialog. “I think almost all Russian companies will be looking at the West African shelf — including Rosneft and TNK-BP,” he added.

LUKoil’s potential resources in the area currently consist of up to 35 million barrels. The company said in September that it might have more petroleum in West Africa than in West Siberia.

Between the increasing international competition for the region’s oil resources, burgeoning nuclear programs, the promise of greater U.S. engagement, the fallout from the Ivory Coast’s political crisis, elections in Nigeria, the beginning of Liberia’s election cycle, and concerns over drug trafficking and terrorism bubbling just below the surface, this should be an extremely interesting and consequential year for West Africa. Thankfully, for the United States at least, Iran’s efforts at engagement in the region appear to have badly faltered in 2009.