Proposed Financing for Thali Permit Could Unlock Investment in Cameroon’s Oil Sector
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In a significant development for Cameroon’s oil and gas sector, a funding provider has proposed key financing to support the Thali permit operated by Tower Resources in the offshore Rio del Rey Basin. Announced last month, the proposed funding involves $15 million for a minority stake in the permit and would allow Tower Resources to retain operatorship, while enabling exploration and production activities. While Tower Resources is exploring farm-in deals with other industry players and engaging in discussions with local financial institutions, this agreement represents a potentially transformative development for Cameroon and the broader African energy industry, offering a model for financing projects in underexplored markets across the continent.
At the Invest in African Energy Forum in Paris next May, discussions will highlight current farm-in opportunities in Africa’s most dynamic upstream markets, unlocking new financing tools designed to support exploration activities.
Flexible Financing Model
The funding would enable the drilling of the NJOM-3 appraisal well, which Tower Resources expects to spud in early 2025. The package is distinctive as it would allow Tower Resources to sustain a stable capital structure by incorporating staggered payments tied to future oil production from Thali. By structuring the financing in a way that distributes risk between the provider and Tower Resources, the arrangement aligns the interests of both parties in the successful outcome of the Thali project.
At the heart of this financing proposal is a structure that mitigates financial risk, while unlocking new avenues of investment. Traditional oil and gas projects often face high capital expenditure and above-ground risk. For an independent exploration and production company, accessing adequate capital without assuming outsized risks continues to be a challenge. The funding provider’s innovative model directly addresses these obstacles by offering flexible financial terms that share and reduce risk exposure. This approach would enhance Tower Resources’ capacity to focus on operations, exploration activities and resource development. The company is also in discussions with local financial institutions, such as the Development Bank of the Central African States, to secure longer-term development financing and guarantees to support three additional planned wells on the Njonji structure.
Blueprint for Investment
As Cameroon aims to attract upstream investment, revitalizing drilling activities in the Rio Del Rey Basin would enhance the country's oil production capacity and stimulate additional exploration investments within the basin. Unlike rigid traditional lending, the proposed financing is tailored to meet the unique conditions of the Thali project. Customization ensures that financing is adaptable to operational needs, making it more responsive to market dynamics and specific project milestones. The proposal’s flexibility in terms of capital allocation could also enable Tower Resources to invest in technology, local partnerships and capacity-building initiatives that enhance operational efficiency and longer-term value generation in Cameroon’s hydrocarbon sector.
This innovative approach could serve as a blueprint for other projects in Africa’s underexplored oil and gas markets. The continent’s vast, untapped reserves have historically struggled to attract sustained international investment due to perceived risks and limited infrastructure. By demonstrating that a risk-sharing, flexible and responsive funding model can work, the Thali project has the potential to attract broader investment.
IAE 2025 is an exclusive forum designed to facilitate investment between African energy markets and global investors. Taking place May 13-14, 2025 in Paris, the event offers delegates two days of intensive engagement with industry experts, project developers, investors and policymakers. For more information, please visit www.invest-africa-energy.com. To sponsor or participate as a delegate, please contact sales@energycapitalpower.com.