* Follows reforms to Gabon's oil sector
* Vitol awarded Rabi Light cargo in March
* Trading houses seek to boost oil volumes
By Emma Farge
GENEVA, Feb 4 Swiss-based Vitol has signed a
long-term contract with Gabon to export oil, trade sources said,
making it the only trading house to win an allocation from the
west African government.
Vitol - the world's top oil trader with annual revenues of
nearly $300 billion - already has a strong presence in the
region and markets oil from Nigeria and Ghana.
The contract is a coup for Vitol which, like
peers such as Glencore, has stepped up efforts to gain
access to long-term contracts in order to safeguard volumes amid
slim trading profits.
Trading houses have shown increasing interest in Africa and
many executives think it could become the fastest growing
continent in the next decade, catching up with Asia, which has
fuelled growth in the past decade.
Industry sources said that the contract was to buy Rabi
Light crude oil directly from state oil firm Gabon Oil Company
(GOC) to sell the government's share of production.
The duration of the contract was unclear although one source
said it was expected to last at least three years.
Provisional shipping lists for March showed that Vitol was
awarded a 650,000 barrel cargo of the medium, sweet crude, worth
a nominal $75 million based on current Brent futures.
Vitol declined comment. Gabon Oil could not be reached for
The industry sources said that Vitol cargoes would be
allocated in exchange for investment in the country's oil sector
and not via cash payments.
This is an increasingly common arrangement between trading
houses and African governments because of perceived credit risk.
In Nigeria, trading houses such as Vitol and Glencore are owed
tens of millions of dollars for late fuel payments.
Up until the middle of last year, oil tenders from Gabon
were awarded by an oil firm called Petrolin Group and were won
by companies such as ExxonMobil and U.S. refiner
An official at Petrolin declined to comment.
Reform to Gabon's oil sector means that the newly formed GOC
will gain an equity share in new blocs and those up for renewal,
increasing its share of the country's production.
This means that GOC, created in mid-2011 by presidential
decree, will likely increase the amount of oil it markets
directly in future.
Gabon was due to award new licences for offshore oil blocs
in 2010 but cancelled the round.
It plans a new licensing round in 2013, and recent
discoveries in the region have raised hopes that big finds will
Oil production from the former French colony is around
200,500 barrels per day (bpd), down from a 1997 peak of around
Still, Gabon has over 3 billion barrels of proven reserves
and enough to ensure oil revenues for several decades.
French major Total, Royal Dutch Shell and
independent production company Perenco all have assets in the