Equatorial Guinea, OPEC’s smallest oil producer, is negotiating prepaid agreements with commodity traders to secure upfront funding for its oil and LNG operations, according to sources familiar with the plans. The government aims to use the funds to maintain existing fields and revive its upstream sector.
The Central African nation has struggled to attract investment in recent years, causing oil production to decline. Although Equatorial Guinea has exported LNG for more than two decades, it now needs capital to cover operational costs and finance its stakes in producing and exploratory assets.
The proposed arrangement would have trading houses provide cash upfront in exchange for future crude and LNG deliveries, including interest payments. Bloomberg’s sources said the country is targeting roughly $300 million in prepaid funding over several years.
Prepaid Deals as a Strategic Tool
Prepaid agreements are a common way for producers to get immediate capital for upstream development. Last year, Equatorial Guinea signed an incentives deal with U.S. supermajor Chevron for the Aseng Gas Project in Block I, which aims to boost LNG exports.
The country’s oil sector faces additional pressure after ExxonMobil exited in 2024, ending a three-decade presence. Exxon sold non-core assets to focus on projects in the Permian Basin, Guyana, and global LNG markets.
Other African producers have also used prepaid arrangements. The Nigerian National Petroleum Company launched a $3.3 billion crude oil prepayment facility with Afreximbank and commodity trader Gunvor International. In 2025, Gunvor supported Gabon’s National Oil Company in acquiring Tullow Oil Gabon S.A., providing prepaid funds for part of the $307 million purchase.