Guinea - Oil and Gas Guinea - Oil and Gas
Overview
The Guinean government sets the price of gasoline at the retail level, subsidizing prices to ease the burden on consumers. Since the start of 2015, due to a decrease in world oil prices, the government reduced the price of gasoline from 10,000 GNF/liter to 9,000 GNF in February 2015 and then to 8,000 GNF/liter in March. The government readjusted the price of all grades of fuel to 10,000 GNF/liter in July 2018. As of July 2018, the exchange rate stands at roughly 9,090 GNF/USD, effectively pricing Guinean fuel at USD 1.10/liter.
Storage capacity of petroleum products in Guinea is a problem, with the sole private importer, Guinea Petroleum Company (SGP), having storage capacity for about three weeks demand. There is no petroleum refinery in Guinea, meaning that even the slightest disruption in fuel deliveries may provoke fuel shortages. Major consumers include mining companies, retail gasoline stations, and the state-owned electric utility’s diesel generators.
Leading Sub-Sectors
The extent of Guinea’s potential oil and gas reserves remains unknown, but promising. A U.S.-owned firm conducted oil exploration studies off of Guinea’s coast. In February 2012, their first exploratory well uncovered non-commercial quantities of oil. In September 2017, their second exploratory offshore drilling reportedly did not find commercially exploitable quantities of oil—but other companies still believe there is commercially viable oil to be found, and the search continues.
Opportunities
The Guinean government is assessing ways to repair its dilapidated energy grid, and may seek new avenues to access petroleum products for its power plants.