Public Interest Modeling Sprint 2016

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Latest release: Vaca Muerta, Argentina.

In October 2016 OpenOil brought together 12 country teams to participate in a 5-day sprint on financial modeling. The aim of the event was to build the basis to a worldwide network of practitioners from civil society, government or private sector, who can share tools, skills and experience, and collaborate to make extractive industry project modeling available to a wider set of stakeholders.

This page contains a list of all models and narrative reports that have been produced during the sprint, following OpenOil’s standardized open-­source approach to financial modeling, and that will be released over the coming weeks.

 

Spotlight

Argentina’s flagship shale project would need billions of dollars of subsidies

The Vaca Muerta-Loma Campana project is an unconventional oil & gas development located in the southwest of Argentina and started operations in 2013. Expectations were high that the development of Vaca Muerta might allow Argentina to return to energy self-sufficiency, and obtain revenue from oil and gas exports – emulating the transformative success achieved in the United States.

Three years later, it looks unviable under the original stated assumptions without massive subsidies.

Vaca Muerta Narrative Report Vaca Muerta Model

For media inquiries:
Johnny West, Director, johnny.west@openoil.net

Previously released

Indonesia: model + new EITI data = answers on how mining regime is applied

Batu Hijau is the second biggest copper producer in Indonesia, operated by Newmont Mining under a 4th Indonesia’s Generation Contract of Work. Discovered in 1990, commercial production began in late 1999 and led to the production of 7.3 billion pounds of copper and 7.1 million ounces of gold to date.

How has the 2014 change in the royalty regime impacted the project economics? How much did past hedging losses cost Indonesia? Has the mine’s profitability recovered from a sharp short-term drop off in production and revenues in 2014-15?

Batu Hijau Narrative Report Batu Hijau Model Batu Hijau Presentation

 

Current uranium price needs to double for Malawi’s biggest mine to reopen

Kayelekera uranium mine is the biggest mining project in Malawi’s history and began production in 2009. In 2013, revenues from the mine contributed 2.6% to Gross Domestic Product. Yet production at Kayelekera was suspended as a result of the crash in uranium prices following the Fukushima nuclear accident.

What uranium price would be required to restart production? What has total government take been to date? Which impact did the reduction in the general royalty rate have?

Kayelekera Narrative Report Kayelekera Model Kayelekera Presentation

 

Brazil’s $90 billion Libra field in trouble – says public data

Brazil’s Libra project is an offshore oilfield that could produce 1.3 million BOPD. But the consortium signed the PSC expecting higher oil prices. With current oil prices ($50 a barrel in Oct. 2016), Libra is unviable unless costs can be reduced significantly, and/or the fiscal regime is renegotiated – particularly the royalty. The project schedule has already slipped – which we think reflects theses challenges – and it may slip further. We will keep a look out for fiscal regime renegotiation…

Libra Narrative Report Libra Model Libra Presentation

 

Next models

Upcoming releases include:

  • Agata (nickel), Philippines
  • Essakane (gold), Burkina Faso
  • Mnazi Bay (oil and gas), Tanzania
  • Segovia (gold), Colombia

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