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Exxon Exits Equatorial Guinea

FILE - In this April 23, 2018, file photo, the logo for ExxonMobil appears above a trading post on the floor of the New York Stock Exchange. Exxon Mobil is making a big bet on the future of exporting natural gas. Exxon and Qatar Petroleum announced…

Exxon has cut its output in Equatorial Guinea to less than 15,000 barrels of oil per day (bpd) through existing production unit Serpentina, one of the sources said on Monday on condition of anonymity to discuss non-public information. It evacuated staff from the offshore production platform Zafiro this year due to water entering the aging vessel.

Exxon's oil output in Equatorial Guinea, a member of the Organization of the Petroleum Exporting Countries (OPEC), peaked at more than 300,000 bpd eight years ago and has been declining since. Exxon has been trying to sell its Zafiro operation since 2020.

The company last year pumped about 45,000 bpd in Equatorial Guinea, out of the country's total production of 93,000 bpd.

The departure reflects a wider move by major oil producers to reduce crude production in West Africa and shift investments to lower-carbon natural gas development on the continent, and to more lucrative projects in the Americas.

"It is a high cost region where carbon emissions are a problem as well," said Gail Anderson, research director for Sub-Saharan Africa at energy consultants Wood Mackenzie.

Africa is struggling to meet OPEC quotas due to the lack of investments in crude production. Output from its top two producers, OPEC-members Angola and Nigeria, sank by a third to 2.1 million bpd in October from 3.2 million bpd in 2019. Since 2013, it has declined 41%.

The region's share of oil cash flows also is falling, a study by consultancy Deloitte found. For Middle East and African oil producers, cash has dwindled to 30% of global flows in the last two years, from 50% between 2010 and 2020.