Europe's Gabon-exposed Stocks Slide after Military Coup

Friday, September 1, 2023

Shares in European oil producers, miners and other companies with large exposures to Gabon plummeted on Wednesday after a military coup raised concerns over their operations in the resource-rich African country.

London-listed oil producer Tullow Oil fell as much as 12% in afternoon trading, while French energy companies TotalEnergies Gabon, and Maurel et Prom, and miner Eramet all dropped by more than 20% at one point.

"Shares are reacting to concerns over the backdrop in Gabon," said Investec equity analyst Alex Smith in London.

Military officers in Gabon said they had seized power on Wednesday and put President Ali Bongo under house arrest, stepping in minutes after the state's election body announced he had won a third term. 

France, Gabon's former colonial ruler which has troops stationed in the African nation, condemned the coup.

Eramet, the world's No.1 producer of high-grade manganese ore thanks to its Moanda mine in Gabon, said it had suspended all operations in the country as a "precautionary measure". 

Timber company Woodbois also said production at its facilities in the Gabonese city of Mouila were suspended, sending its London-listed shares almost 16% lower. 

However, Assala Energy, which current owner Carlyle CG.O has agreed to sell to Maurel, said its oil production in Gabon was unaffected.

Tullow Oil also told analysts its production was continuing as normal. 

"Note Gabon production represents around 20% of group production. However, assets are based offshore, and importantly, oil revenue is dollar denominated," said Investec's Smith.

Gabon produces about 200,000 barrels a day (bpd) of crude oil, making it the second-smallest OPEC producer.

Oslo-listed Panoro Energy and BW Energy were down 5% and 7%, respectively, and U.S.-based Vaalco Energy fell 13.8%.

According to maritime sources, at least 30 commercial ships dropped anchor on Wednesday around Gabon's waters.


(Reuters - Reporting by Danilo Masoni, editing by Alun John, Kirsten Donovan)

Categories: Energy Industry News Activity Production Africa

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