First"cheap" airline in Africa

[Wahalla]

part 2
Tanzania has East Africa’s largest LCC market

Tanzania’s liberal stance was a key reason for fastjet’s selection of Dar es Salaam as its initial base. Tanzania already had two airlines with international services (and a few domestic operators) when fastjet Tanzania launched in late 2012.

fastjet has successfully stimulated growth in Tanzania’s domestic market and has now launched four international routes

fastjet has successfully stimulated growth in Tanzania’s domestic market and has now launched four international routes – Johannesburg, Lusaka, Harare and Entebbe. Several more international routes are planned including Nairobi but fastjet continues to encounter red tape in securing authorisations from foreign countries.
Tanzania is liberal enough to potentially even allow flydubai to pick up passengers on domestic sectors, which would further stimulate growth in the domestic market. flydubai is launching daily service to Dar es Salaam on 16-Oct-2014 with two weekly flights continuing to Kilimanjaro (from 17-Oct-2014) and two weekly flights to Zanzibar (from 19-Oct-2014).
Unlike Entebbe to Bujumbura and Kigali, flydubai is listing on its online booking engine flights from Dar es Salam to Kilimanjaro and Zanzibar. But at least for now all the local sectors are displayed as “sold out”, only allowing passengers to book through tickets from Kilimanjaro and Zanzibar to Dubai.
Tanzania’s liberal policy has enabled it to become the largest LCC market in East Africa. After flydubai becomes the third LCC in the market, joining fastjet and Mango (which has two weekly flights from Johannesburg to Zanzibar), Tanzania will have an LCC penetration rate of about 26%. In comparison Kenya has an LCC penetration rate of about 9% while Ethiopia’s LCC penetration rate is less than 1%.
Kenya and Ethiopia are both well placed for LCC expansion

Kenya should see significant LCC growth if fastjet succeeds at establishing a Kenyan affiliate. fastjet Tanzania also has been trying to secure authority to serve Kenya using its existing Tanzanian air operator's certificate.
fastjet Kenya’s launch could prompt the Kenya Airways Group to accelerate expansion at Jambojet
fastjet Kenya’s launch could prompt the Kenya Airways Group to accelerate expansion at Jambojet. As CAPA previously outlined, the Jambojet initial strategy is conservative and defensive. The Kenya Airways Group at least for now has no intention of using Jambojet to serve the international market as the carrier focuses on stimulating demand in the domestic market, particularly on routes which have been unprofitable under the full-service brand. But changes in Kenya’s competitive landscape could quickly change how Jambojet is used.
See related report: Kenya Airways new budget subsidiary Jambojet to focus on stimulating demand in domestic market
Ethiopia is also ripe for LCC growth and its ambitious flag carrier, Ethiopian Airlines, could eventually be persuaded to join its Kenyan rival in establishing a budget subsidiary. Ethiopian is now the largest airline in East Africa, accounting for about 32% of total capacity compared to 19% for Kenya Airways.
East Africa capacity share (% of seats) by carrier: 20-Oct-2014 to 26-Oct-2014

Source: CAPA – Centre for Aviation, OAG and others
After Ethiopian Airlines and Kenya Airways the East African market is extremely fragmented with several small East African carriers accounting for between 1% and 3% shares of the total market. Emirates is the largest foreign carrier and the third largest airline overall in the East African market with about a 5% share of total seat capacity. Turkish, KLM and Qatar Airways are the next largest foreign carriers, with each having about a 2% share of capacity.

Overall LCCs now account for 8% of total capacity in East Africa

Overall LCCs now account for 8% of total capacity in East Africa. The LCC growth over the past two years is just the tip of the iceberg as East Africa is still one of the least penetrated regions in the world.

Further LCC expansion in East Africa is inevitable

East Africa will likely attract several more routes from foreign LCCs, primarily from the Middle East and North Africa. Air Arabia could potentially launch more East African routes from Sharjah to catch up with its Dubai-based rival as well as start using its Egyptian affiliate to serve East Africa.
But the biggest growth will come from local start-ups. fastjet and Jambojet almost certainly will be joined by new East African LCCs.
the most logical model for covering the region would be through cross-border joint ventures
Each individual market is rather limited and as there are only a few big domestic routes in the region, the most logical model for covering the region would be through cross-border joint ventures.
fastjet is making the first move in establishing an LCC group across East Africa – and the rest of Africa. Mango and flyafrica.com have also expressed interest in this model, which has been extremely successful in penetrating the Asian market.
See related reports:

• flyafrica.com and fastjet give Zimbabwe its first taste of LCCs with local start-up
• SAA low-cost subsidiary Mango looks to international market as competition with fastjet beckons

Over the last year the pace of LCC expansion in East Africa has picked up. The road ahead is still challenging but it can only go in one direction as the region finally starts to embrace the LCC phenomenon.
CAPA employs a leading team of writers and analysts positioned around the world. Find out more about CAPA's regional and global analysts.
Feedback or comments? Please email us your comment or feedback on this article.

[Wahalla]

East Africa's LCC network grows to 17 routes across eight countries

After flydubai launches services to Tanzania in mid Oct-2014 there will be 17 LCC routes in east Africa. The top six routes are domestic while the other 11 routes are international and are served with between two and seven weekly frequencies.
flydubai’s new daily flight from Dubai to Dar es Salaam, which continues two days per week to Kilimanjaro and two days per week to Zanzibar, will be the eighth LCC route in East Africa launched so far this year. (This is counted as one route as flydubai is not currently selling seats on the domestic sectors.)
East African LCC routes ranked by seat capacity: 20-Oct-2014 to 26-Oct-2014

Rank	Route	Carrier	Launch date	Weekly seats
1.	Nairobi-Mombasa	Jambojet	Apr-2014	8,584
2.	Dar es Salaam-Mwanza	fastjet	Nov-2012	6,552
3.	Dar es Salaam-Kilimanjaro	fastjet	Nov-2012	5,616
4.	Dar es Salaam-Mbeya	fastjet	Nov-2013	4,368
5.	Nairobi-Kisamu	Jambojet	Apr-2014	3,848
6.	Nairobi-Eldoret	Jambojet	Apr-2014	3,848
7.	Dubai-Entebbe-Kigali/Bujumbura*	flydubai	Sep-2014	2,436
8.	Dubai-Dar es Salaam-Kilimanjaro/Zanzibar*	flydubai	Oct-2014	2,436
9.	Sharjah-Nairobi	Air Arabia	Oct-2008	2,268
10.	Dubai-Djibouti*	flydubai	Sep-2009	1,740
11.	Dubai-Addis Ababa	flydubai	Apr-2011	1,044
12.	Dar es Salaam-Lusaka	fastjet	Feb-2014	1,248
13.	Dar es Salaam-Entebbe	fastjet	Sep-2014	1,248
14.	Dar es Salaam-Johannesburg	fastjet	Oct-2013	936
15.	Dar es Salaam-Harare	fastjet	Aug-2014	936
16.	Colombo-Seychelles	Mihin Lanka	Nov-2013	780
17.	Johannesburg-Zanzibar	Mango	Sep-2013	744

Notes: *flydubai serves Entebbe daily with three weekly flights continuing onto Kigali and two continuing to Bujumbura with the other two turning around in Entebbe.
flydubai will serve Dar es Salaam daily with two weekly flights continuing onto Kilimanjaro and two continuing onto Zanzibar with the other three turning around in Dar es Salaam. These routes are not listed separately by sector as flydubai at least initially is not carrying any fifth freedom traffic.
Some of flydubai’s flights between Dubai and Djibouti stop in Aden in Yemen.
Source: CAPA – Centre for Aviation, OAG and others
Of the 17 routes, 14 were launched within the last two years. Air Arabia became the first LCC to serve the East Africa market in 2008, when it launched services from its Sharjah hub to Nairobi. This is still Air Arabia’s only East African route and is currently served daily with A320s.
flydubai entered the East African market in 2009 with service to Djibouti, which along with neighbouring Eritrea and Somalia is the closest African country to the UAE. Addis Ababa in Ethiopia became flydubai’s second East African market in 2011. flydubai currently operates five weekly flights to Djibouti and three weekly flights to Addis Ababa using 737-800s. It is the only LCC serving both markets.
flydubai also became the first LCC serving Rwanda on 27-Sep-2014 and will become the first LCC in Burundi on 30-Sep-2014. Kigali in Rwanda is being served as a three times per week tag to Entebbe in Uganda while Bujumbura in Burundi is being served as a twice per week tag to Entebbe. flydubai is serving Entebbe, which was launched on 27-Sep-2014, with seven weekly flights including two turnaroundflights.
Of the 10 countries in East Africa only Eritrea and Somalia, two very small markets which have been plagued in recent years by political instability, will still lack any LCC service after flydubai enters Burundi on 30-Sep-2014. Seychelles gained its first LCC service in late 2013 when Mihin Lanka launched flights to the small island nation from Colombo, while Tanzania got its first taste of low fares in late 2012 when fastjet began operations.
flydubai joins fastjet in launching services to Uganda

fastjet beat flydubai by 11 days to become the first LCC to serve the Ugandan market. fastjet launched services from its Dar es Salaam base to Entebbe on 17-Sep-2014.
fastjet currently serves Dar es Salaam-Entebbe, which is not served by any other carrier, with four weekly A319 flights. On the Entebbe-Dubai route, flydubai joined sister carrier Emirates, which currently operates one daily flight using A340-500s.

Uganda is a small but natural market for LCCs as it is underserved following the suspension of operations at flag carrier Air Uganda

Uganda is a small but natural market for LCCs as it is underserved following the suspension of operations at flag carrier Air Uganda.
Air Uganda operated a fleet of three CRJ200 regional jets and one Boeing MD-80 until Jul-2014, when most of its fleet was returned. Air Uganda had linked Entebbe with Bujumbura, Dar es Salaam, Kigali, Kilimanjaro, Mogadishu, Mombasa, Nairobi and Juba.
Uganda is likely to receive more LCC services

fastjet fills the void left by Air Uganda in the Entebbe-Dar es Salaam market. fastjet could potentially also serve Entebbe from Nairobi once its new Kenyan affiliate is launched. The group announced in late Aug-2014 that fastjet Kenya, which is 49% owned by London-listed fastjet and 51% by an undisclosed Kenyan investor, had applied for an air service licence (ASL).
Entebbe-Nairobi would be logical for fastjet Kenya as it is a large route that is ripe for low fare stimulation and would meet the overall fastjet strategy of connecting the dots.
In addition to Kenya, fastjet is now in the process of establishing an affiliate in Zambia and has been looking at several other potential home markets throughout Africa. Uganda however is likely too small to support its own LCC and instead can be served by multiple affiliates.
See related reports:

• African LCC fastjet accelerates expansion with three new bases and 10 more aircraft by end-2015
• Zambia provides fastjet with easier affiliate option than South Africa, Ghana, Kenya or Nigeria
• Low-cost airlines start to penetrate African international market, led by fastjet

Kenya Airways now enjoys a monopoly on Entebbe-Nairobi, which is the largest route from Entebbe. Kenya Airways currently operates five daily flights between Entebbe and Nairobi and is by far the largest carrier in the Entebbe market with about a 27% share of seat capacity. Kenya Airways has been the biggest beneficiary of the Air Uganda suspension.
Entebbe international capacity share by carrier (% of seats): 29-Sep-2014 to 5-Oct-2014


Source: CAPA – Centre for Aviation, OAG and others
Uganda would benefit from LCC fifth freedom services

No carrier has picked up the Entebbe-Bujumbura route since Air Uganda’s suspension, while Entebbe-Kigali is now served by Rwandair andEthiopian. Rwandair is the fourth largest airline in the Entebbe market and currently operates 24 weekly regional jet flights from Kigali.
Ethiopian has a limited presence on the Entebbe-Kigali route as it only offers a non-stop option one-way from Entebbe to Kigali as the route is part of a daily Addis Ababa-Entebbe-Kigali-Addis Ababa circle route. (For Kigali to Entebbe, Ethiopian only offers a circuitous connection via Addis Ababa.)
protectionist policies are still common throughout Africa despite the obvious benefits of competition, particularly LCC competition
flydubai has become the fifth airline operating Entebbe-Kigali as a tag without local pick up rights, joining Brussels Airlines, KLM, Qatar Airways and Turkish Airlines. It is unlikely any of these carriers will be able to secure pick-up rights as the Rwandan government is generally protective of its flag carrier. Such protectionist policies are still common throughout Africa despite the obvious benefits of competition, particularly LCC competition, for consumers and the overall economy. The logic becomes even more powerful in the absence of viable flag carriers, as is the case in many markets.
flydubai has reportedly secured pick up rights for Entebbe to Bujumbura but the carrier is currently not selling this sector or including the city pair in its online booking engine. In theory pick up rights for this market would be easier to secure as the route is not currently served and neither country now has a flag carrier to protect.
But it can take months and even years for airlines to secure all the required approvals in Africa for fifth freedom services.
LCCs will help Uganda grow its aviation market (and economic activity)

Uganda should be actively promoting LCC services including authorising fifth freedom services for foreign LCCs such as fastjet and flydubai. Without a local international carrier there should be little resistance but Uganda could be holding out in the hope its flag carrier can relaunch. (There are still some very small domestic operators in Uganda.)
Uganda is the fourth largest aviation market in East Africa after Kenya, Ethiopia and Tanzania based on current weekly seat capacity. But it is less than half the size of Tanzania and about one seventh the size of Kenya and Ethiopia.
It is critical for small African markets such as Rwanda, which is only slightly smaller than Uganda, to be receptive to LCCs and have liberal aviation policies. Unfortunately many African countries have still not embraced LCCs.

[Wahalla]

Part 1 flydubai and fastjet drive LCC growth in East Africa as Uganda gets its first taste of low fares

CAPA > Aviation Analysis > flydubai and fastjet drive LCC growth in East Africa as Uganda gets its first taste of low fares
29th September, 2014

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East Africa is seeing an influx of new LCC services, led by expansion at flydubai and fastjet. flydubai is launching six destinations in four East African countries during Sep/Oct-2014, which will make it the leading LCC in the region’s international market.
flydubai and fastjet both launched services to Entebbe in Sep-2014, giving Uganda its first taste of lowfares. flydubai will also by the end of Sep-2014 become the first LCC to serve Burundi and Rwanda, increasing the number of East African countries with low-cost services to eight, compared to only three two years ago.
There are only about 300 weekly flights operated to from or within East Africa by low-cost carriers, resulting in an LCC penetration rate of about 8%. But LCCs are expanding rapidly in the region with over half of East Africa’s LCC routes launched within the last year.

LCC capacity in East Africa approaches 50,000 weekly seats

There are now five LCCs serving East Africa providing (as of mid Oct-2014) just under 50,000 weekly seats. About three-quarters of these seats are provided by two local carriers – fastjet Tanzania and Kenya Airways budget subsidiary Jambojet. But flydubai has quickly become the largest LCC in the East African international market.
The launch between 27-Sep-2014 and 16-Oct-2014 of services to Entebbe, Kigali, Bujumbura, Dar es Salaam, Kilimanjaro and Zanzibar will give flydubai eight destinations in East Africa. flydubai was already serving Addis Ababa and Djibouti.
fastjet Tanzania also now serves eight destinations – four domestic and four international – while Jambojet is purely a domestic operator with four destinations.
The other three LCCs serving the region – South African Airways budget subsidiary Mango, Sharjah-based Air Arabia and Sri Lanka-basedMihin Lanka – are much smaller with just one East African route each. But Air Arabia and Mango have huge opportunities to expand in the region, potentially with multiple affiliates. fastjet is already planning to launch a second East African affiliate in Kenya.
East Africa LCC capacity by carrier (weekly seats): 20-Oct-2014 to 26-Oct-2014

Carrier	Domestic seats	International seats	Total seats	% of total LCC capacity
fastjet	16,536	4,368	20,904	43%
Jambojet	16,280	N/A	16,280	33%
flydubai	N/A	7,656	7,656	16%
Air Arabia	N/A	2,688	2,688	6%
Mihin Lanka	N/A	780	780	1%
Mango	N/A	744	744	1%
TOTAL	32,816	16,236	49,052

Note: Regional airline group fly540 is excluded as it is generally not considered to follow the LCC model
Source: CAPA – Centre for Aviation, OAG and others

[Wahalla]

that article was one of discovery for me.... And it is good to note that none of these airlines are from the west... the idea of fast jet is that it is an interafrica service, ratehr than focus to take people oot of Africa.... Mango and Jambo does the same on a smaller scale...

[Wahalla]

Chinese complete a gas pipe line in Tanzania.... this could be a major developmetn filip in east Africa

http://newscontent.cctv.com/NewJsp/news.jsp?fileId=263047

Workers finished construction of a gas pipeline project in Tanzania on Saturday, signaling the completion of the main artery of the Chinese-built energy expressway.

The gas pipeline project is designed to solve the long-existing power shortage in the East African country and boost its economy.

The project includes two gas processing plants, a 508-kilometer-long land section and a 34-kilometer-long seabed section.

"As the so-called second Tanzania-Zambia railway, the construction of the gas pipeline has been completed, and mechanical work will be finished by the end of this year," said Chen Qingxun, deputy-director of the China Petroleum Pipeline Bureau.

"Tanzania has a population of about 40 million, but only less than 7 million can use electricity now. About 20 million people can use electricity after the project is put into operation," said Lu Jiangbo, assistant to the general manager of the China Petroleum Technology Development Corporation.

"Other industries can come on, so investors can easily come, they're sure of power, they're sure of gas. In five, ten years, to come after construction of the pipeline, I'm sure, we will see a complete change, " said Kapuulya Musomba, project manager of Tanzania Petroleum Development Corporation.

It is believed after the gas pipeline project is put into operation, it will facilitate other industries including power stations, power transmission and petrochemical industry so as to promote the industrialization process of the country.

The gas pipeline project, as an example of "China speed," is recognized by an international supervision company for its solid quality.

"The CPP welding quality is exceptional. Typically, on an international pipeline, you would find repair rates of five percent and we have found and confirmed the welding repair rate on this pipeline to be below one percent and there were even some areas where we had a repair rate of CPP 0.07 percent rate," said Peter, a quality director of inquiry and supervision company of Tanzanian projects.

[Wahalla]

interesting.... but as expansion continues.. .the comment in red is illuminative....

http://centreforaviation.com/news/sax-tanzania-to-commence-operations-in-late-2014-380634

You may also be interested in the following articles...

• African LCC fastjet accelerates expansion with three new bases and 10 more aircraft by end-20151-Jul-2014
  Fledging African LCC group fastjet is planning to accelerate expansion over the next 18 months with several new international routes from its original base in Tanzania and the launch of three new affiliates. The expansion is risky and ambitious but is necessary as the group currently lacks the scale to be sustainable.
  fastjet has not added a single aircraft in 18 months – an unusually long time for an LCC start-up. The group now plans to expand its fleet from three to 13 A319s by the end of 2015.
  Further growth is expected in 2016 and 2017 to a total of 24 aircraft as planned new affiliates in Zambia, Kenya and South Africa expand. fastjet could quickly become Africa’s largest LCC brand but will have to overcome multiple challenges, including potential regulatory hurdles, which have so far stalled its progress.
  

Fastjet September Passenger Numbers Up But Load Factor Declines

Tue, 7th Oct 2014 09:17


LONDON (Alliance News) - Fastjet PLC Tuesday said its passenger numbers in September were higher year-on-year but said its load factor decreased in the period.



The company's Tanzania operations carried a total of 57,756 passengers in September, up 79% on the 32,322 carried a year earlier.
Its rolling passenger numbers for the 12 months to September rose 79% year-on-year, up to 513,345 from 287,378 last year.
However, Fastjet's load factor decreased by two percentage points in the period, down to 74% from 76% last year.
"I am delighted to see such strong total passenger numbers and high load factor for September compared to August, a peak travel month," said Ed Winter, the Chief Executive Officer and Interim Chairman of fastjet. Last month, Fastjet said its August load factor was 79%.
"Our capacity will continue to grow during October with increased frequency on the Entebbe and Kilimanjaro routes and we expect to see an increase in average utilisation per aircraft to 10.2 hours, closer to our target of 11.7 hours," Winter added.
Fastjet shares were down 4.2% to 1.15 pence.
By Sam Unsted; [email protected]; @SamUAtAlliance

[Wahalla]

Tanzania says power link to Kenya, Zambia to be completed next year

Mon Oct 6, 2014 1:13pm GMT

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By Fumbuka Ng'wanakilala
DAR ES SALAAM (Reuters) - Tanzania will complete a $455 million power transmission line next year linking its power grid to Kenya and Zambia, part of plans to export electricity powered by its gas and coal reserves to neighbours, the Energy and Minerals Ministry said on Monday.
Tanzania, which has found commercial quantities of gas offshore and sits on big coal deposits, aims to double its generation capacity to 3,000 megawatts (MW) by 2016 to meet rising domestic demand and supply the region.
Power shortages are common across Africa and businesses often complain that poor or erratic supplies deter more investors and push up prices of local products, as many firms have to rely on costly generators when power is cut.
Known as the "backbone interconnector", Tanzania's Energy Ministry said the $455 million link would be in place by April, one of several regional projects that include links running between Kenya and Ethiopia and between Kenya, Uganda and Rwanda.
"The backbone project will link with Kenya's northern power grid and Zambia's southwestern power grid and transform Tanzania into a regional hub for the east and southern Africa power pool,” the ministry said in a statement.
The 667-km (417-mile) high voltage line is being built with financing from the European Investment Bank, World Bank, African Development Bank, Japan International Cooperation Agency and Korean Economic Development Cooperation Fund.
Tanzania, Kenya and Zambia signed a deal in Dar es Salaam on September 30 to link the three countries. Tanzania's Energy Ministry said last year it was in talks with Kenya to export 1,000 MW of electricity to east Africa's biggest economy.
Tanzania has 46.5 trillion cubic feet (tcf) of proven natural gas reserves and is investing in a pipeline and new gas-fired power plants to boost generation. It also aims to export gas with a planned build liquefied natural gas (LNG) plant.
It also has 5 billion tonnes of coal reserves and plans to build coal-fired power plants.

[Wahalla]

This may be of interest... see the note in Red.. Far LTD held exploration blocks in Jamaica....they gave them up the blocks...

Senegal eyes new block awards




More blocks to be offered: FAR’s three blocks offshore Senegal are highlighted in red
FAR LTD





Senegal aims to award exploration licences for two more offshore blocks by the end of the year after UK independent Cairn Energy unearthed an oil discovery off the nascent African hydrocarbons nation, according to a report.By Upstream staff & Reuters
15 October 2014 15:39 GMT


State-run player Petrosen is also looking to tie down funding to be able to pursue a third block on its own, the report from Reuters said on Wednesday.
"We already have proposals. We are evaluating the best for the state of Senegal," Petrosen director general Mamadou Faye said of the impending decision to award new acreage.
Faye did not identify who the interested parties were, or who is likely to land the block deals.
Cairn revealed earlier this month that it had made a significant deep-water discovery at the at the Fan-1 wildcat, establishing a new petroleum system in the region.
Cairn struck 29 metres of net oil pay in the Cretaceous sandstones with API ranging from 28 degrees to 41 degrees.
The discovery, drilled in 1427 metres of water about 100 kilometres offshore in the Sangomar Deep block, could hold 950 million barrels of oil in place, broadly in line with pre-drill estimates.
Spudded in April, the probe reached a target depth of 4927 metres but did not find an oil-water contact in a gross oil bearing interval of more than 500 metres.
Once operations are completed on Fan-1, Transocean semi-submersible Cajun Express will complete Cairn’s second wildcat in Sangomar Deep, SNE-1, the top hole of which has already been drilled.
This probe has two objectives, potentially holding 600 million barrels of oil, and is located beneath 1100 metres of water.
Cairn has a 40% stake in three blocks off Senegal, with US giant ConocoPhillips on 35%, Australian junior Far with 15% and Petrosen on 10%.

[Wahalla]

Statoil strikes again off Tanzania




STATOIL






The Giligiliani-1 exploration well discovery has added 1.2 trillion cubic feet of gas in place to the existing Block 2 volume, taking total gas in place to about 21 Tcf.
The gas was discovered in the Upper Cretaceous sandstone formation.
Statoil western hemisphere senior vice president Nick Madden said this discovery shores up an extension of the proven gas play.
“Our success rate in Tanzania has been high and opening up a new area will be key to continuing our successful multi-well programme,” he said.
The well was drilled on the western side of Block 2, in water depths of 2500 metres.
This is the joint venture’s seventh discovery on the block, preceded by five high-impact gas discoveries the Zafarani-1, Lavani-1, Tangawizi-1, Mronge-1 and Piri-1, and a discovery in Lavani-2.
Giligiliani-1 was drilled using the drillship Discoverer Americas, which will now move to drill the Kungamanga prospect in the central portion of the block.
The joint venture is looking at a possible liquefied natural gas project to incorporate the discoveries, with final investment decision due by the end of 2016.
Statoil operates the licence with a 65% working interest, while ExxonMobil holds the remaining 35% interest.
The block covers 5500 square kilometres, with water depths between 1500 and 3000 metres.

[Wahalla]

this is an interesting read on Zimbabwe... note Mugabe is a master politician as a number of these potential successors ( then they were sellouts in the Jamaicans.com parlance or not if they are martried to black partners.) were his opponents in the last two decades and he subverted them into government... for all of my disdain for the man for the last two decades he would have been brilliant as a leader of Iraq..




Note while he talked emotively of land to "farmers" in the name of black nationalism... At the same time the commanding heights of the economy have been taken over by what seems to be company controlled by the powerul black apparatchik..... , where the economy and large sums of money involved will grow have been concentrated into the hands of the "liberating party"

.So damn easy to dress it up in the emotive rhetoric of the Chimurenga..Dress bribery in the clothes of black nationalism and corruption is a right if u claim to be a son of the soil....... the Zuva Energy ,  Trafigura, Glencore,.

Trafigura was the mess with comrades in Jamaica and leaves a bad taste...

I am backing Joice Mujuru.. lovely name for a leader!


In Zimbabwe, Factions Within Mugabe's Party Prepare for a Potential Succession

Analysis


JUNE 12, 2014 | 0430 Print Text Size


Zimbabwean President Robert Mugabe addresses his party's national conference in 2012. (JEKESAI NJIKIZANA/AFP/Getty Images)



Summary

The competition between factions of the Zimbabwe African National Union-Patriotic Front will reach a key moment at the party's December leadership conference. If Justice Minister Emmerson Mnangagwa emerges as the successor to party chief and Zimbabwean President Robert Mugabe -- at this conference or in the future -- he will likely be able to ensure stability and become an agent for economic reform and political normalization. This could reintegrate Zimbabwe with the international community.


Analysis

The recent words and actions of key members of the Zimbabwe African National Union-Patriotic Front have highlighted competing factions' attempts to put themselves in a favorable position prior to Mugabe's potential death or replacement as party leader. Two main factions have emerged: Mnangagwa's camp is demonstrating its significant backing, while Mugabe is deflecting the succession issue and continuing to fight to maintain his hold over the presidency.
The Feuding Factions

Mugabe lashed out against one of Mnangagwa's allies, Information Minister Jonathan Moyo, at the funeral for party veteran Nathan Shamuyarira on June 7. Moyo has used his control over the state media to back Mnangagwa's position and has been very critical of Mugabe and others within the party over the past year. While allies of Joice Mujuru, the current vice president and Mnangagwa's main competitor in the succession bid, supported the claims made against Moyo, Mugabe is not necessarily backing Mujuru as his successor.

Click to Enlarge



Mugabe has consistently avoided supporting any potential successor but has been involved in party infighting in order to preserve his own power. The Zimbabwe African National Union-Patriotic Front's victory over the Movement for Democratic Change in the 2013 election secured the party's position. Mugabe was instrumental in this as the face of the party, but now that the party's position is safe, internal pressure to replace Mugabe has been growing. The president seems determined to finish his term and has not even referred to a succession. Declaring a successor could lead to a rapid dissolution of his own power as attention shifts from garnering favor with Mugabe to appeasing his replacement. This is a common risk in countries that have a personality-based authoritarian leadership structure.
However, Mnangagwa's faction would like to see the succession mapped out sooner rather than later. Sources have told Stratfor that Mnangagwa's camp would like to secure the succession before Mugabe turns 91 in February. Mugabe's health is deteriorating, and his potential passing before the next election is a looming concern. Settling the succession issue would help avoid the sudden power struggle that Mugabe's inability to complete his term would trigger. Leading figures in the country's armed forces and intelligence community who back Mnangagwa allegedly have pressured Mugabe into making it clear to Mujuru that she will not be considered to take over the presidency on anything beyond a temporary basis. However, Mugabe does not appear ready to commit to any succession plans yet.
Support from Zimbabwe's security and military leadership will be important for Mnangagwa when the succession plans are finally settled. The armed forces, Central Intelligence Organization and Joint Operations Command, which coordinates state security and over which Mnangagwa presides, are the pillars supporting the ruling party's power. Mujuru and Mugabe also receive some level of backing from Zimbabwe's security and military apparatuses, and Mujuru has her own political backing consisting of Cabinet members, lawmakers and representatives of Zimbabwean civil society. Her alliance is unlikely to hold up, however, against the security organizations that physically control Zimbabwe and government revenue. Moreover, although Mnangagwa appears to be the strongest player right now, the security and military leadership's focus is on guaranteeing a stable succession and avoiding a violent coup or security breakdowns.
Mnangagwa's Potential

If Mnangagwa succeeds Mugabe, he could be well-received in the international community because he is believed to be a possible instrument for economic reform and political normalization. Mnangagwa and his allies have already demonstrated their willingness to overturn Mugabe's Indigenization and Economic Empowerment Act by opening up the country's fuel distribution network to foreign corporations. While the indigenization policies that play mostly into securing local electoral support have become less important to the ruling party since the 2013 elections, it is notable that companies such as Glencore and Trafigura allegedly are making significant headway in gaining control of Zimbabwe's fuel distribution through Mnangagwa and his backers. John Mushayavanhu, a banker many consider to be one of Mnangagwa's allies, purchased a majority stake in Zuva Petroleum earlier this year, but elements within the Zimbabwean administration are now fighting the transaction due to allegations that Mushayavanhu is a frontman for Glencore. Similarly, Mnangagwa and his backers secured control of Sakunda Energy, which Puma Energy, a South African subsidiary of Trafigura, is now purportedly acquiring.
Mugabe loyalists' defense of the strict application of the indigenization policies helps to secure the president's position in two ways. The public battle for indigenization aims to hold onto popular support in Zimbabwe, while the legal battle against the deals facilitated by Mnangagwa's allies limits his ability to garner international support.
Zimbabwe's economy is in dire need of reforms; the official government treasury is virtually empty. Foreign diplomats and investors reportedly see Mnangagwa as a possible agent of economic change. Zimbabwe also requires investment in much-needed infrastructure relating to power generation and refining capacity if the country wants to ensure foreign investment in platinum mining. Potential investors are already said to be maneuvering to benefit from Zimbabwe's transition. They have been causing movements of capital on the Zimbabwe Stock Exchange while also setting up shell companies in South Africa and engaging politically connected business partners through front offices in Zimbabwe.
While many have a possible stake in both the succession and economic reforms, everything still depends on Mugabe dying or stepping aside at some point. The Zimbabwe African National Union-Patriotic Front's party leadership conference in December will mark a key moment for the competing factions within the party, including Mugabe, to establish their control. While Mnangagwa holds a great deal of power, Mugabe and Mujuru could still extend their own political reach to block or postpone his ascension as Mugabe's successor, casting doubt on the timeline Mnangagwa's backers envision for succession.





Read more: In Zimbabwe, Factions Within Mugabe's Party Prepare for a Potential Succession | Stratfor
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Richest African woman...

The Richest Black Woman In The World, Folorunsho Alakija

November 29, 2012 Editor Entrepreneurs

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VENTURES AFRICA/Africa’s Secret Millionaires – Move over, Oprah – there is a newrichest black woman in the world. And she’s Nigerian.
Meet Folorunsho Alakija, a Nigerian billionaire oil tycoon, Fashion designer and philanthropist who is worth at least $3.3 billion- contrary to a recent Forbes Magazine ranking which pegs her net worth at only $600 million.
Alakija, 61, was born into a wealthy, polygamous Nigerian family. She started out her professional career in the mid 70s as a secretary at the now defunct International Merchant Bank of Nigeria, one of the country’s earliest investment banks. In the early 80s, Alakija quit her job and went on to study Fashion design in England, returning to Nigeria shortly afterwards to start Supreme Stitches, a premium Nigerian fashion label which catered exclusively to upscale clientele.
The business thrived, and Alakija quickly made a tidy fortune selling high-end Nigerian clothing to fashionable wives of military bigwigs and society women.
Folorunsho Alakija – Oil Prospecting License

In May 1993 Alakija applied for an allocation of an Oil Prospecting License (OPL). The license to explore for oil on a 617,000 acre block – (now referred to as OPL 216) was granted to Alakija’s company, Famfa Limited. The block is located approximately 220 miles South East of Lagos and 70 miles offshore Nigeria in the central Niger Delta.
This was in 1993. Many wealthy Nigerian businessmen and military bigwigs who had been allocated oil blocs by the military administration at the time had no clue as to the technicalities in operating an oil block, so many of them typically acquired OPLs, and then flipped them off to international oil companies for substantial profits.
But Alakija was intelligent. She had no expertise or experience in running an oil field, but she decided not to sell off her license. In September 1996, she entered into a joint venture agreement with Star Deep Water Petroleum Limited (a wholly-owned subsidiary of Texaco) and appointed the company as a technical adviser for the exploration of the license, transferring 40 percent of her 100 percent stake to Star Deep. Subsequently, Star Deep sold off 8 percent of its stake in OPL 216 to Petrobas, a Brazilian company. Folorunsho Alakija and her family owned 60 percent.
Folorunsho Alakija and the Nigerian Government

Star Deep Petroleum carried on with exploitation of the oil field. In 2000, the first appraisal well was confirmed to have recoverable reserves in excess of 1 billion barrels of oil equivalent. When this was discovered, the Nigerian government, led by Olusegun Obasanjo immediately ordered that a 40 percent interest in OPL 216 be allocated to the Nigerian National Petroleum Corporation (NNPC) under the Back-in-Right Regulation of 2003 which gives the Nigerian government participatory rights in any OPL or OML. You can read more about this back-in-right regulation in detailhere.
This would leave Famfa Oil with a 20 percent stake. This was in 2000, and the government did not pay Famfa a dime for the stake. In 2003, Famfa applied for a conversion from an OPL to an OML, and in 2004 the request was granted. OPL 216 became OML 127.
But the Nigerian government was not content with its 40 percent stake in Famfa. In 2005, the government led by General Olusegun Obasanjo forcefully acquired a further 10 percent stake in OML 127.
Folorunsho Alakija immediately went to the courts to challenge the government’s forceful acquisition take a 50 percent in the license. It was a lengthy court battle which lasted for several years, but in May 2012, the Supreme Court voided the government’s acquisition of a 50 percent stake in OML 127 and subsequently transferred the 50 percent stake back to Famfa Oil. (Read about Famfa’s victory here).
The Nigerian government tried to appeal the Supreme’s court decision, but the case has been dismissed- a victory for Famfa Oil which sees the little-known oil company owning a 60 percent in OML 127, which is one of Nigeria’s most prolific oil blocks.
Valuation Of OML 127

Daily production at OML 127 currently stands at 200,000 barrels per day. When the Nigerian government, through its wholly-owned petroleum company, NNPC, was trying to justify its forceful acquisition of a 50 percent stake in OML 127 at the Supreme court, the Government admitted that if Famfa Oil owned a 60 percent stake in the OML, the company stood to earn $10 million on a daily basis (after taxes and other exploration costs have been settled). The government’s argument at the Supreme Court can be found through this link, (item number 23).
So how much is a 60 percent stake in OML 127 worth?
Comparator: In July 2012, Royal Dutch Shell agreed to sell its 45 percent stake in OML 30 for $850 million to Heritage Oil and Shoreline Energy.
According to Fool.co.uk, OML 30 currently produces 35,000 barrels of oil per day.
So, if 45 percent of a 35,000 bpd-producing oil bloc is $850 million, 100 percent of the same bloc = $1.88 billion i.e 100/45 x $850 million
If a 100 percent stake in a 35,000 bpd-producing oil bloc is $1.88 billion, by the same logic, a 100 percent stake in 200,000 bpd-producing oil bloc is worth $10.74 billion i.e 200,000 bpd/35,000 bpd X $1.88 billion
Folorunsho Alakija’s 60 percent stake in a $10.74 billion oil well is worth $6.44 billion.
Technically, her 60 percent stake in OML 127 is worth $6.44 billion.
Another comparator: In November 2012, French oil group Total announced that it was selling a 20 percent stake in its Nigerian offshore oil field to China’s Sinopec in a $2.5 billion deal. The block in question, OML 138 is a 180,000 bpd facility.
So, if a 20 percent stake in an 180,000 bpd facility offshore block is worth $2.5 billion, the entire block is worth $12.5 billion i.e 100/20 x $2.5 billion. Since a 180,000 bpd-producing facility is worth $12.5 billion, a 200,000 bpd-producing facility is worth $13.8 billion because 200,000/180,000 x $12.5 billion.
Using the Total-Sinopec deal as the yardstick, we could also value OML 127 at $13.8 billion. In that case, her 60 percent stake would be worth $8.3 billion.
But to be conservative, we prefer to go with the lower valuation of $6.44 billion.
On Debt
Ventures Africa reached out to Famfa Limited to comment, but the company declined to divulge any information regarding any long-term or short-term debt. We have no idea on how much debt (if any, the company has), but even if we take the high side, and subtract 50 percent of the value of her stake for debt, that still gives her 60 percent stake in OML 127 a market value of $3.2 billion, which makes her richer than the $2.7 billion Oprah Winfrey is worth according to Forbes Magazine’s last rankings.
Folorunsho Alakija -Real Estate: $100 million

Folorunsho Alakija also has a real estate portfolio worth over $100 million. Earlier this year, Nigerian and British media announced that Alakija acquired a property at One Hyde Park for $102 million. See media coverage here andhere
A source at Famfa Oil who asked for anonymity indeed confirmed that Mrs. Alakija actually acquired the property at One Hyde Park.
Folorunsho Alakija’s Private Jet

Alakija owns a Bombardier Global Express 6000 which she bought earlier this year for a reported $46 million.
Folorunsho Alakija and Philanthropy

Folorunsho Alakija is the founder of the Rose of Sharon foundation, a Christian-based charity which gives out small grants to widows. Find out more here.
Folorunsho Alakija and Family

Alakija is married to Modupe Alakija and they have four grown-up sons together. She also has a grandchild from her first son. Modupe Alakija, her husband is the Chairman of Famfa Oil. Her sons run the company.
Watch CNN’s interview with Folorunsho here
Read the latest news and articles for African Billionaires and key business players at Ventures Africa
Follow Ventures Africa on Twitter @VenturesAfrica . Join us as we explore Africa through a business lens!
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I hope they learn from the Hawaiian experience...


Kenya Launches World’s Largest Geothermal Plant

October 22, 2014 Editor Business, Energy

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VENTURES AFRICA – Kenyan President Uhuru Kenyatta has launched the Olkaria IV power plant, the world’s largest geothermal power plant, in a bid to add 140 Megawatts (MW) to the national grid and bring down electricity costs down by 30 percent by the end of this month and 50 percent by early next year.
“You cannot fight poverty if you cannot create an environment where you can create jobs. All that cannot happen if you don’t have the essentials which is energy. These investments that we are making will go a long way towards empowering our people and combat social ills that have inflicted this country over the years,” President Kenyatta said.
The project, worth Sh11.5 billion ($126.5 million), was co-financed by the Kenyan Government, the World Bank, European Investment Bank among others. To manufacture the plant, the government engaged the likes of Hyundai Engineering, Toyota Tshusho of Japan, and KEC of India.
Expressing his displeasure at the delayed completion of many projects initiated by his government due to persistent procurement squabbles, he urged the leaders to allow the concerned institutions investigate complains without impeding on the pace of development. “We cannot keep on with this trend of stopping major projects which would transform the lives of our people. We have to really start thinking,” he said.
Deputy President, William Ruto, at the launch, revealed that the government would be connecting some 5,000 schools to the grid by April, 2015 in preparation for a “free school laptop” project. In his words; “There are real things happening. You know, we are not talking of a story here, we are talking of reality. So we want to tell Kenyans that this is not showbiz.”
He said this to reassure the citizenry that the government would make good on the promise it made last year to connect 11,000 primary schools to the power grid, 6,000 of which already have electricity. The news is a breath of fresh air for the Kenyan citizenry who have been grappling with sketchy power services and high payment rates.
Global institutions, inclusive of the World Bank and governments outside the continent have launched multiple initiatives aimed at rewriting the country’s appalling power story. One of the successful initiatives is the Kenya Private Sector Power Generation Support Project which raised a total financing package of $623 million, $357 million of which came from private sector investments and commercial lending.
In the words of Johannes Zutt, Kenyan Country Director at the World Bank; “This approach can be expected to be replicated in other countries in Sub-Saharan Africa with well-performing energy sectors.”
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Africa’s Top Energy Consumers, Net Exporters

October 28, 2014 Editor Business, Energy

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VENTURES AFRICA – In a continent desperately needing an aggressive energy plan, it is worth identifying the top consumers and producers of the continent’s energy.
Four southern African countries, according to a report by the International Energy Agency (IEA), are reported to account for the highest electricity consumption in Africa. South Africa, Zambia, Botswana and Zimbabwe are the continent’s top consumers.
“In Southern Africa, average consumption per capita is the highest of all sub-regions, but this is driven principally by very high levels in South Africa and relatively high levels in Zambia, Botswana and Zimbabwe – all above 500 kWh per capita per year,” said International Energy Agency in a in the report on Sub-Saharan energy prospects.
South Africa’s inclusion is not surprising, giving its vastly developed and industrial economy. The country produces over 40,000MW of electricity, the highest by any African country. In contrast, Nigeria, Africa’s largest economy and most populated nation, was absent in this category. Giving its enormous population and a rapidly growing economy – an average of 7 percent annually, which places at the helm of the growth markets list – demand, and subsequently consumption, was expected to top the African chart.
But poor infrastructure and neglect have done little to offset the poor demand:Supply ratio. Nigeria still produces an average of 2,500MW to 3000MW for a population almost four times the size of its closest economic rival South Africa.
The IEA report says the Democratic Republic of Congo, Ethiopia and Mozambique are the largest net exporters of electricity, each developing large hydropower projects for the purpose, while South Africa (net imports meet 5 percent of demand in 2040), Nigeria (the second-largest importer, after South Africa) and some other parts of Southern Africa are the main net importers.
It added that Sub-Saharan Africa has an estimated 43 million television sets (equivalent to about one in every four households), 17 million refrigerators (around one in every ten households) and 450 million mobile phones – about one for every two people. Ownership of mobile phones in sub-Saharan Africa has risen at a brisk pace and provides access to multiple services, such as personal and business communications and online banking, for relatively low electricity consumption.
Total residential electricity demand in the sub-Saharan region will grow by 6 percent per year to 2040, with increasing and more reliable supply, and rising incomes funding the purchase of more appliances.
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wahalla

More people have phones than access electricity ????????

[Wahalla]

A Tanzania-based low-cost airline just announced a major distribution deal with Chinese company Qunar, aimed at attracting more Chinese travelers who are either planning to come to or are already in Tanzania to book their flights.
With over 75 million hits on the Qunar website every month and nearly 35 million Qunar apps, under the new deal, Fastjet’s schedules and booking platforms will be accessible by those combined 110 million potential passengers at the click of a button.
Commenting on this latest innovation of what is fast becoming Africa’s first multi-country, low-cost carrier Ellis Cain-Jones, Head of Commercial at Fastjet, said: “This is an extremely exciting venture, with passenger traffic from Asia and particularly China realizing significant year-on-year growth. We already have agreements with a number of travel agents specializing in ticket sales to the Chinese market, but this represents a firm step to increase numbers and direct sales. The number of Chinese passengers flying into East Africa is already significant and offering Fastjet fares and schedules to this growing market will only be positive for the airline.”

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Guy Scott orders minister to give licence to UK airline

November 10, 2014 57 Comments









Acting president Guy Scott has ordered Communication and Transport minister to hurriedly grant UK airline Fastjet a licence to operate domestic routes in Zambia.
Fastjet is a UK based budget airline headquartered at Gatwick airport.
But ministry of communication officials are fearful that the granting of the licence is dubious, questionable and may push local airline operators out of business.
The licence was put on minister Mukanga’s office to append his signature today.
Reliable sources in the industry have disclosed that the approval process did not follow normal procedures.
It is alleged that Acting President Guy Scott was used by the Fastjet executives to give instructions to the juniors.
‘There is a lot of disquiet in the lower ranks of the Ministry who had resisted the whole arrangement. There is a general feeling the whole process smells of corruption as it has been fast-tracked and soon the airline plans to commence operations. It is also understood that Fastjet has used gullible Zambians as fronts to be shareholders despite that they never paid any dime for their shares in order to beat the system,’ a source close to the case said.
There are calls that the Anti-Corruption Commission should investigate the shareholding of Fastjet Zambia and ascertain how the Zambians were able to afford the shares allocated so that they are majority shareholders!
Fastjet has been trying to get licenses in Africa to take advantage of the aviation opportunities in the continent as Europe is saturated but clever countries like South Africa, Kenya,Nigeria and others have denied them entry as domestic markets are reserved for locals.