Africa plays a vital role in the global oil market, with its producing nations contributing around 8% of total global supply. However, the second quarter of 2023 has seen numerous production challenges. From unplanned outages to maintenance activities, a plethora of events and circumstances contributed to a slight decrease in Africa’s oil and condensate production during this period. The African Energy Chamber (AEC) explores the production decline in our newly released report, “The State of African Energy: 2Q 2023 Outlook.” It notes that between January and May of this year, Africa lost approximately 180,000 barrels per day (bdp) of production…
Author: NJ Ayuk
Despite the call heard ’round the world commanding the global business community to divest from fossil fuels and shrink their carbon footprints in the name of net zero, international oil companies (IOCs) still recognize Africa as their next frontier. As detailed in the African Energy Chamber’s recently released report, “The State of African Energy Q2 2023 Outlook,” oil and natural gas exploration in Africa remains strong. Following the massive Namibian discoveries in 2022, 2023 has been another banner year for African exploration, with half a billion barrels of oil equivalent (bboe) in recoverable oil and gas reserves found around the…
The signing of the PIA represented the culmination of more than 20 years of efforts to reform an oil and gas sector plagued by long-standing problems on multiple fronts For years, on behalf of the African Energy Chamber (AEC), I publicly encouraged Nigeria’s leadership to sign the Petroleum Industry Bill (PIB) into law. Across its five chapters and 300 sections, the PIB promised to repeal all regulations pertaining to Nigeria’s oil and gas industry, effectively resetting decades of policy gridlock regarding fiscal imbalances and the detrimental effects of crime and corruption. In place of these regulations, the PIA offered a…
The 27th United Nations Climate Change Conference, or the Conference of the Parties of the UNFCCC (COP27), held in Sharm El Sheikh, Egypt, in November 2022, featured a slight philosophical shift from where mindsets had been just the year before. COP26 saw Africa under pressure to accept that its fossil fuel resources should remain underground. During the conference, representatives from wealthier nations made efforts to cast our continent as the recipient of undue climate change impacts deserving of financial compensation and the impetus to accelerate their own green agendas. This year, the failure to deliver on those compensatory commitments, paired…
Sub-Saharan countries are playing an increasingly prominent role in African oil production this year. OPEC members Nigeria and Angola remain among the continent’s top producers. In fact, they, along with Libya, Algeria, and Egypt, will account for 80% of African oil output in 2023. But, as noted in the African Energy Chamber’s (AEC’s) newly released outlook report, “The State of African Energy Q1 2023,” much of the remaining oil this year will come from sub-Saharan countries like Gabon, Chad, Congo, Ghana, and Equatorial Guinea. Let’s examine recent oil industry developments in each of these countries in greater detail. Gabon Since…
When Europe began searching for alternatives to Russian oil and gas following that country’s invasion of Ukraine, one of the producing countries they focused on was Algeria. The decision made strategic sense from both a supply and access standpoint. Algeria is the world’s 10th largest global gas producer and fourth largest gas exporter, and only Russia and Norway were already supplying Europe with more energy. Most of Algeria’s flows to the continent travel by tanker to liquefied natural gas (LNG) plants in France or by pipeline to Spain, Portugal, and Italy. More specifically, the Maghreb-Europe pipeline transports Algerian natural gas through…
Several years ago, the African energy industry was in survival mode. The COVID-19 pandemic had practically eliminated demand for crude oil, and African exports dropped sharply. That’s why — though many African states are still feeling the wounds inflicted by COVID — I find it encouraging to learn that Africa’s liquids supply in 2023 has reached nearly 7 million barrels per day (MMbbs/d), more than 430,000 barrels per day (bpd) above Africa’s 2020 lows of about 6.55 MMbbs/d. This progress is among the topics covered in the African Energy Chamber’s newly released State of African Energy Q1 2023 Report. The report…
South Africa has been setting a positive example for its approach to ensuring a just energy transition. Not only is South Africa embracing renewable energy projects, but it is also wisely pursuing several proactive measures to generate the necessary funding. One such approach is the Renewable Energy Independent Power Producer Procurement Program (REIPPPP), which focused on incentivizing private-sector investment in biomass, wind, and small hydro. The government operated the program between 2011 and 2015 to address energy poverty and extend access to clean electricity. This effort gave South Africa over 6,000 megawatts (MW) of renewable generation capacity. Due to its…
South Africa has great aspirations for its energy industry: Not only has the country committed to significant decreases in carbon emissions, but it is also intent on creating a thriving green economy that creates jobs and business opportunities throughout the country. And with great ambitions come a great price tag, in this case, an estimated $99 billion. No doubt about it — this is an optimistic vision. But I do not believe it’s beyond the realm of possibility. In fact, the African Energy Chamber’s (AEC’s) new report, “The State of South African Energy,” forecasts a considerable increase in South Africa’s…
South Africa is a regional heavyweight. Its economy is one of the largest on the African continent — as well as the most diversified, the most industrialized, and the most technologically advanced. It has more extensive road and rail networks than any other African state, a feature that puts it in a good position for future growth. But South Africa also has a very big problem. Since 2007, the national power provider Eskom has not been able to produce enough electricity to cover domestic demand — and the ever-widening gaps between supply and demand have given rise to a steady…
On Tuesday, Nov. 9, 1965, 30 million people living in an 80,000-square-mile swath of North America were plunged into total darkness by an electricity blackout that lasted 13 hours. The power failure, which struck Ontario, Canada, and 10 U.S. states, could not have come at a worse time — rush hour — or in a worse place: its epicenter was New York City. There, an estimated 800,000 subway commuters were stranded underground, and thousands of office workers were stuck between floors in skyscraper elevators. Planes couldn’t land at darkened airports, and surgeons reportedly worked by flashlight after hospital backup generators…
One of the most promising outcomes of the COP27 climate conference last November was the launch of the African Carbon Markets Initiative (ACMI). This African-led initiative is designed to significantly drive up the continent’s participation in voluntary carbon markets. Carbon markets are platforms for carbon trading: the buying and selling of credits that allow entities to release a specified amount of carbon dioxide or other greenhouse gases. Essentially, carbon trading allows countries (or companies) to fund projects that reduce emissions instead of reducing their own emissions. The climate projects that benefit from this system range from reforestation and forest conservation…
When I was working on my 2019 book, Billions At Play: The Future of African Energy and Doing Deals, I wrote that Qatar was well on its way to achieving its goal of becoming the “Gas Capital of the World.” The tiny country is home to some of the largest gas-to-liquid (GTL) plants in the world and supplies more liquefied natural gas (LNG) than anyone else. It also uses its huge natural gas reserves, 872 trillion cubic feet (tcf), as feedstock for Qatar Fertilizer Company, the world’s largest single-site producer of ammonia and urea. Since I wrote about it, Qatar…
In late 2019, as the African oil and gas industry was looking to the future with optimism, Offshore Engineer wrote that the continent was had reason to expect a “more productive 2020.” Instead, the unforeseen happened, and the COVID-19 pandemic had a devastating impact on the oil and gas industry in Africa and around the world. But even at the end of last year, during a fairly strong period for oil and gas, the publication mentioned that “delays and hiccups” were impacting licensing rounds — that is, the processes by which investors can seek oil and gas exploration licenses from…
It didn’t surprise me when TGS, the Norwegian seismic data company, announced last May that it would work with National Oil Company of Liberia (NOCAL) to reprocess more than 5,100 square kilometers of 3D seismic data captured in the offshore Liberian basin. After all, the company has a 20-plus year history working in west Africa. TGS has helped countries strengthen their petroleum laws and supported authorities’ efforts to promote licensing rounds and farm-outs. But the comments from one TGS leader struck me. In a simple sentence, the remarks from Executive Vice-President, Eastern Hemisphere Will Ashby, expressed both pride in the…
They’re bringing private capital, experience, and know-how to the continent In late 2019, Africa Oil Corp. President and CEO Keith Hill told Petroleum Economist that, given Africa’s unproven oil and gas basins, the continent was probably “the greatest frontier,” with outstanding opportunities for exploration, production, and development companies, including independents. Three years later, Hill remains bullish about Africa, and Canada-headquartered Africa Oil Corp. is driving oil and gas exploration here. The company is part of a growing trend we’re seeing: independent oil and gas companies that recognize the tremendous promise of our underexplored continent and are finding ways to thrive…
This past October, the African Energy Chamber presented African Energy Week 2022, a multi-venue event that opened with a keynote address by OPEC Secretary General Haitham Al Ghais of Kuwait. He demonstrated a strong understanding of, and concern about, Africa’s widespread energy poverty and the continent’s great need to continue harnessing its oil and gas resources while supporting global efforts to address climate change. “Energy, like education and healthcare, should not be considered a luxury but a basic human right,” Al Ghais said. “The overarching issue of climate change and energy transition will have massive implications for Africa. Countries around…
Africa’s oil and gas industry is going to breathe new life into many African economies and will create new opportunities for every many Africans in 2023. During the recent African Energy Week, many players and host nations outlined some of the most ambitious plans produce more natural gas, diversify our economies and create more jobs especially for women and our young people. This is a better plan than development aid. In September 2022, the EU approved an additional 15 million euros to support counterinsurgency efforts in Mozambique. That fresh funding – intended to protect the natural gas-rich area of Cabo…
As the executive chairman of the African Energy Chamber (AEC), it’s my honor and my privilege to tell the world the story of Africa’s oil and gas industry – to explain what this continent can do to help power the world and fuel its own future. But it’s also my mission to talk about African energy poverty and to explain why this continent needs better access to energy now in order to illuminate its own potential and power forward. To illustrate the issue of energy poverty in general, I’d like to focus on energy poverty in Nigeria in particular. Within…
Africans at COP27 and beyond need to pay critical attention about Africa’s position as a key source of critical minerals. Climate change and energy poverty are two sides of the same coin. How about during this COP27, Global leaders push to process Africa’s minerals in Africa. Let’s not forget, Africa is blessed with some of the world’s largest reserve of metals and minerals needed for batteries, including lithium and cobalt, making the continent a key supplier for the global energy transition. At this COP27, the African Energy Chamber believes when we process these minerals in Africa, we rapidly eliminates emission-spewing…
Just when you think nothing could be worse for the global economy than a pandemic, Russia invades Ukraine, and the world spirals closer to recession. In Africa, the twin shocks of COVID-19 and Russian aggression have torn through a society vulnerable to even far milder upsets. Although the continent was showing modest recovery from the economic devastation that accompanied COVID-19 shutdowns, progress has been erased by rising food, fertilizer, and fuel costs. Despite International Monetary Fund (IMF) estimates that real GDP growth will be 4% in 2023 — with some countries, such as Senegal and Ghana, expected to reach 5%…
The wealthy nations’ green agenda does not consider how much Africa needs natural gas to bring electricity to the growing number of Africans living without it I am going to COP27 because I believe if Africa is not on the table it will be on the menu. Let me be clear, those of us who are advocating for African countries to continue using their oil and gas resources are not “ignoring” the world’s green agenda – we’re simply not willing to embrace the world’s timetable for transitioning to renewable fuels at the expense of our own energy security and…
Four years have passed since the U.S. imposed sanctions on South Sudan’s oil industry. The goal had been to prevent oil money from funding the civil war that had been raging since 2013. By curtailing the ability of businesses and organizations to provide revenue for the South Sudanese government, U.S. officials reasoned, they could pressure President Salva Kiir to end the conflict plaguing his country. Whether or not you believe the sanctions contributed to peace, the war has indeed ended. Government leaders signed a peace deal in 2018 and formed a unified government in 2020. Why, then, do sanctions that…
When Nigeria’s Petroleum Industry Act (PIA) was signed into law in August 2021, I spoke about the positive changes the law would be driving in terms of increased transparency and energy sector productivity. Now, we’re seeing indications that the PIA is, indeed, yielding fruit. The state-owned Nigerian National Petroleum Company (NNPC) recently became NNPC Limited, a commercial venture, as mandated by the PIA. Rather than operating as a government entity, with all of the red tape and inefficiencies that went with it, the company’s focus has been shifted to productivity and earning profits. The company appears to be moving in…
In May 2021, the International Energy Agency (IEA) issued a report calling for a halt to oil and gas exploration around the globe at the end of the year African countries are hardly alone in their refusal to accept global pressure to rush their transition from fossil fuels to renewable energy sources like solar, wind, and hydrogen power. In May 2021, the International Energy Agency (IEA) issued a report, “Net Zero by 2050: A Roadmap for the Global Energy Sector ,” calling for a halt to oil and gas exploration around the globe at the end of the year. That…
50% of the 2022-25 cumulative gas flows from Africa’s top-10 producers are expected to be exported as LNG In the months since the European Union declared it would reduce its reliance on Russian oil following that country’s invasion of Ukraine, there’s been a lot of talk about the new opportunities this moment is creating for Africa’s natural gas industry. I myself have been part of that conversation, and I stand by my past statements. Africa’s capabilities are considerable, as the African Energy Chamber (AEC) makes clear in our State of African Energy Q2 2022 Report. What’s more, certain developments within…
IOCs play an important role in supporting economic growth, job creation, capacity building, and knowledge sharing Last fall, I wrote about the importance of African governments doing everything they could to encourage international oil companies (IOCs) to continue operating in their countries. IOCs play an important role in supporting economic growth, job creation, capacity building, and knowledge sharing. Currently, two IOCs in particular — Azule Energy in Angola and Shell Petroleum Development Corporation of Nigeria (SPDC) — have tremendous promise to deliver those benefits on a long-term basis. Azule Energy, a newly formed independent joint venture of BP’s and Eni’s…
Against a backdrop of continuing global economic chaos, any information that suggests stability is well-received. Which is why the details about African oil and gas capital expenditures contained in the African Energy Chamber’s forthcoming Q2 2022 Oil and Gas Outlook Q2 report are such welcome news. In the near term, the report says, CAPEX will hold steady. Considering that spending across the sector has been trending upward since reaching its nadir in 2020 — rising from a low of $22.5 billion to a projected $30 billion in the first quarter of 2022 — simply maintaining the status quo is an…
There’s no question that Africa’s energy industry is under assault from Western climate activists. Not only are they pressuring the continent to leave its vast hydrocarbon resources untouched rather than using them to unlock much-needed economic growth, but they’ve also convinced many financial sponsors to withdraw support from African fossil fuel production. As the Republic of Congo is about to prove, however, there are ways to monetize vast natural gas discoveries while also helping to decarbonize the world’s energy mix. What’s more, the same effort has great potential to increase the availability of electricity to the Congolese and reduce Europe’s…
