This is a best prospect industry sector for this country. Includes a market overview and trade data.
Last Published: 8/15/2016

The leading sectors are oil, energy, tourism, and infrastructure.  The Sao Tomean government seeks to build a deep water port and improve the international airport.  They believe the two projects could transform the country into a central African hub for services because of its strategic position in the Gulf of Guinea.
 

Overview

While there have not been any major oil finds in STP’s waters, STP is surrounded by major oil producing economies including Nigeria, Equatorial Guinea, and Gabon.  Although prospects for oil production remain uncertain, new technologies may open the door to a revival in exploration activities.

STP has oil blocks in both a Joint Development Zone (JDZ) with Nigeria and its Exclusive Economic Zone (EEZ).  There are currently no companies producing petroleum in either the JDZ or the EEZ, and in recent years both Total and Sinopec abandoned oil blocks after disappointing exploration results.  Now there are new expectations on the STP Exclusive Zone.

STP has a modern and effective legal framework in place for the oil sector, including its Framework Law on Petroleum Operations (Petroleum Act), the Petroleum Taxation Act, Model Production Sharing Contract, and a law which organizes the Exclusive Economic Zone in three zones and 19 exploration blocks.  A Framework Law of Oil Revenues governs the management of oil revenue and calls for the government to set aside a certain percentage of oil revenue in a National Oil Account.
 

Sub-Sector Best Prospects

Kosmos Energy acquired 65 percent of Equator Exploration’s interest in block 5 of STP’s Economic Exclusive Zone (EEZ) on February 19.  Kosmos will operate block 5 with Equator retaining a 20 percent interest.  This follows Kosmos’ October 2015 acquisition of ERHC Energy’s rights in Block 11 of the EEZ, which allows Kosmos to operate the block and gives it an 85 percent ownership stake.  STP’s National Petroleum Agency holds the remaining 15 percent.  Also in February, Kosmos also partnered with Galp Energia for stakes in Block 6.  Kosmos and Galp each have a 45 percent interest, with the National Petroleum Agency holding 10 percent.  Galp operates that block.  

When or if STP commences oil production, there will be significant complementary opportunities for oil services companies.
 

Opportunities

Opportunities remain to be seen pending commercially viable finds.
 

Web Resources

Official Government Web Page: www.gov.st, www.anp-stp.gov.st

Prepared by our U.S. Embassies abroad. With its network of 108 offices across the United States and in more than 75 countries, the U.S. Commercial Service of the U.S. Department of Commerce utilizes its global presence and international marketing expertise to help U.S. companies sell their products and services worldwide. Locate the U.S. Commercial Service trade specialist in the U.S. nearest you by visiting http://export.gov/usoffices.