Feb 3, 2023
OPEC’s Smallest Member Replaces Oil Minister as Output Dwindles
(Bloomberg) -- Equatorial Guinea named Antonio Oburu Ondo as oil minister, replacing one of the president’s son amid dwindling production in Opec’s smallest member.
President Teodoro Obiang Nguema Mbasogo, who has ruled for four decades, signed the decree late on Thursday appointing Ondo, who was serving as chief executive of the central African country’s state oil company GEPetrol. He replaces Gabriel Obiang Lima, who was named minister of economy and planning.
The new cabinet announced late Thursday, comes as authorities are looking to reverse an oil slump that saw output dropping by a third in recent months to just 60,000 barrels a day in January, according to OPEC data.
Plummeting production added pressure on Lima, despite his attempts to attract fresh investment, and he had to go, “whether you’re the president’s son or not,” said Theophilus Acheampong, a senior analyst with S&P Global Market Intelligence. The change isn’t likely to impact investor sentiment and doesn’t imply any policy changes, Acheampong said by phone from London.
The move points to the growing clout of Vice President Teodoro Obiang. The 54-year-old, commonly known as Teodorin, is the front-runner to succeed his father, who has ruled since he seized power from his uncle in a bloody 1979 coup.
“The oil ministry is the most important source of revenue. This removes him from the war chest,” Acheampong said of Lima, who’s also seen as vying for the presidency.
President Obiang extended his rule in elections last November, winning 95% of the vote.
Lima’s tenure as minister coincided with a sharp drop in oil prices following the coronavirus pandemic and Russia’s invasion of Ukraine. In November, the country’s biggest producer, Exxon Mobil Corp., announced that it would exit when its license expires in 2026.
The country aims to reconnect wells at its Zafiro field by the end of February, helping to resolve the most recent drop in its output, Lima said at a London conference last week. Any significant gains will hinge on drawing up a new development plan to incorporate further oil discoveries.
Lima took over as Opec president, a revolving position within the organization, this year, but it will pass to the new oil minister.
Oil is the mainstay of Equatorial Guinea’s economy, making up 80% of exports and 70% of fiscal revenue. The sector has seen an almost 10% annual decline over the past five years.
As part of the cabinet reshuffle, former vice minister of education Manuela Roka Botey was named the country’s first woman prime minister on Tuesday.
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