PRESENTATION BY GBOLAHAN ELIAS D.Phil (OXON.) SAN G. ELIAS & CO. (SOLICITORS AND ADVOCATES)

1. PRESENTATION BY GBOLAHAN ELIAS D.Phil (OXON.) SAN G. ELIAS & CO. (SOLICITORS AND ADVOCATES) AT THE AFRICA LEGAL NETWORK (ALN) CONFERENCE AND ANNUAL GATHERING 2013 ON “WEST AFRICA ENERGY – GROWTH, VARIETY AND EXPERTISE” (November 22, 2013)

2. G. Elias, SAN -- G. ELIAS & CO. (SOLICITORS AND ADVOCATES) • “WEST AFRICA ENERGY – GROWTH, VARIETY AND EXPERTISE” • TABLE OF CONTENTS • Introduction • Actors • Locations • Commodities • Issues – Then and Now • Issues – The Future • Law Firm Practice • Apologies • A Comprehensive Table? • End • 2

3. G. Elias, SAN -- G. ELIAS & CO. (SOLICITORS AND ADVOCATES) • “WEST AFRICA ENERGY – GROWTH, VARIETY AND EXPERTISE” • 1.INTRODUCTION • The West Africa energy sector has grown rapidly over the years • The principal actors in the sector, locations, energy sources, issues and development of legal practice on it have changed significantly over the years • In this presentation we will examine the main stages in its development and what those stages have meant for the practice of lawyers • 3

4. G. Elias, SAN -- G. ELIAS & CO. (SOLICITORS AND ADVOCATES) “WEST AFRICA ENERGY – GROWTH, VARIETY AND EXPERTISE” 2. Actors • The initial actors were electricity producers for the mining sector • They were followed by State-owned hydro electric power entities • The larger international oil companies came later • These were followed by national oil companies such as Nigeria’s NNPC • National integrated electricity monopolies followed • Then foreign oil and gas independents came • West African independent oil and gas producers are now players • West African independent electric power companies are now also becoming significant players 4

5. G. Elias, SAN -- G. ELIAS & CO. (SOLICITORS AND ADVOCATES) • “WEST AFRICA ENERGY – GROWTH, VARIETY AND EXPERTISE” • 3. Locations • The early centres of activity were inland coal and other mines and swamps • Then the coastal onshore areas became very active • True offshore activity began in earnest about 1990 • Attempts to make progress in onshore basins have so far not been very successful 5

6. G. Elias, SAN -- G. ELIAS & CO. (SOLICITORS AND ADVOCATES) “WEST AFRICA ENERGY – GROWTH, VARIETY AND EXPERTISE” 4. Commodities • The earliest work was with coal and hydro power for local electricity production • Then we began to produce oil for export • Gas for export then followed with condensates, natural gas liquids and liquefied natural gas projects • The production of gas for local consumption – petrochemicals and power - is becoming central • Work on tar sands has begun but much still needs to be done 6

7. G. Elias, SAN (SOLICITORS AND ADVOCATES) • “WEST AFRICA ENERGY – GROWTH, VARIETY AND EXPERTISE” 5.Issues – Then and Now • The main issues in the early days were about licensing and foreign investment • Tax and the environment also later became major issues • The control of ministerial discretion and executive power has also been very significant • More recently, divestment programmes by foreign investors and programmes of preferences for local actors have become key issues 7

8. G. Elias, SAN -- G. ELIAS & CO. (SOLICITORS AND ADVOCATES) • “WEST AFRICA ENERGY – GROWTH, VARIETY AND EXPERTISE” • 6. Issues – The Future • Pressure to privatize the NOCs and State electric power assets will intensify • Pressure to improve tax incentives will grow under the threat of competition from Portuguese-speaking, East African and Western (shale gas) competition • Pressure to reduce the role of executive discretion will grow as public sector transparency improves • Pressure to have a single regulator for both gas and power will grow • Pressure to allow cost-reflective tariffs but counter anti-competitive combinations in the electric power sector will increase • 8

9. G. Elias, SAN -- G. ELIAS & CO. (SOLICITORS AND ADVOCATES) • “WEST AFRICA ENERGY – GROWTH, VARIETY AND EXPERTISE” • 7. Law Firm Practice • As long as Governments and IOCs virtually monopolized the sector, much of the talent in the sector was outside the law firms • With greater complexity in the issues arising, the law has, and lawyers have, become more sophisticated and true expertise has developed • With greater private sector involvement and demands for public sector transparency, the demand for legal expertise has grown and so have the revenues and skills resident in law firms • The coming years are set to be very exciting, perhaps more so on electricity sector work rather than oil and gas • 9

10. G. Elias, SAN -- G. ELIAS & CO. (SOLICITORS AND ADVOCATES) • “WEST AFRICA ENERGY – GROWTH, VARIETY AND EXPERTISE” • 8. Apologies • This presentation has been Nigeria-centric (although I have tried to disguise it). It is the country that I know best, and it has a long history in the sector • The various stages described thus far overlap both within any given country and across countries • It is difficult to bring all of the various elements together in a single, simple, one-sheet presentation, but I try to do so on the next sheet. • 10

11. G. Elias, SAN -- G. ELIAS & CO. (SOLICITORS AND ADVOCATES) • “WEST AFRICA ENERGY – GROWTH, VARIETY AND EXPERTISE” • 11

12. THANK YOU! • END