News / Africa

Africa's Oil, Gas Frontiers Set to Boost Supply

An oil processing facility is seen at an oilfield in Unity State, South Sudan, April 22, 2012.An oil processing facility is seen at an oilfield in Unity State, South Sudan, April 22, 2012.
x
An oil processing facility is seen at an oilfield in Unity State, South Sudan, April 22, 2012.
An oil processing facility is seen at an oilfield in Unity State, South Sudan, April 22, 2012.
Reuters
New producing countries are set to redraw sub-Saharan Africa's oil and gas map over the next five years, contributing to a significant net increase in output and attracting the top global companies.

Today, the region's heavyweight producer nations, Nigeria and Angola, together pump around four million barrels per day [bpd] of crude oil, and they also dominate natural gas output. Only a handful of other countries in the region produce more than a couple of hundred thousand barrels of oil and gas equivalent.

A few years from now, the balance could be very different. A decade of high prices, good terms for exploration drillers from governments increasingly open to business, and better seismic techniques for finding deposits have lengthened the list of African nations that are on the brink of production.

Uganda, Kenya, Ghana and Niger are among those that could see new fields producing more than 100,000 bpd of oil by the end of the decade. Mozambique and Tanzania are looking for gas and planning compression plants to liquify it for shipping to Asia.

By 2018, sub-Saharan Africa could be producing an extra 400,000 bpd of oil, according to consultants Wood Mackenzie. That would, for example, almost meet the demand of wealthy Sweden and Denmark together - 15 million people - and would increase the sub-Saharan region's total crude output to 6.6 million bpd.

Natural gas output this year is about 6.8 billion cubic feet per day (bcf/d), or 70 billion cubic meters annually, enough to supply the gas needs of Italy or Germany. Production should top nine bcf/d by 2018 and reach 12.7 bcf/d by 2023, Wood Mackenzie estimates.

At present, some two thirds of sub-Saharan Africa's gas is exported as liquefied natural gas [LNG] from Nigeria, Angola and Equatorial Guinea.

Big players

Until recently, the largest companies in such states seen as being on the "frontier" of the industry included the likes of African exploration specialist Tullow Oil, mid-ranked international groups such as Anadarko and ENI, and smaller exploration players such as Ophir Energy, Kosmos, Africa Oil and a host of others.

Lately though, global heavyweights like Chevron and Total have become involved.

"The supermajors are looking at the success that some of these companies have had, and they're trying to get in on the ground floor, picking up the exploration acreage at an early stage and working with that all the way up to drilling the prospects," said Martin Kelly, Wood Mackenzie's lead analyst on sub-Saharan Africa.

In the past couple of years, Chevron has taken up exploration blocks in Liberia and Sierra Leone, while Total has new acreage in deep water off Kenya and deepwater blocks in Mozambique. Royal Dutch/Shell is prospecting deepwater acreage off Tanzania with Petrobras. Exxon Mobil, Shell, and Total all are exploring in the waters off of South Africa.

"There's a bit of a land-grab ongoing by the supermajors," said Kelly.

Political risks from unforeseen government action remain, as Heritage Oil discovered when Uganda presented it with a heavy tax bill when it sold up in the country. Research this week from Credit Suisse re-assesses recent deals in the light of possible tax demands, though, and says valuations still look strong.

And broker, RFC Ambrian, lists association with industry heavyweights as a bonus for small explorers in the region: "The potential for new petroleum discoveries in sub-Sahara Africa is being underestimated by equity markets," it said.

New Production

One of the big recent finds, the offshore Jubilee field, already is producing 110,000 bpd for Ghana and Tullow, a company which has become Europe's number one oil and gas independent thanks to developments in 16 sub-Saharan countries.

Also in Ghana, Ghana and Tullow said the Tweneboa, Enyenra, Ntomme [TEN] cluster of fields could be processing some 80,000 barrels a day initially once it gets Ghanaian government approval.

In Congo Republic, a modest producer already, Chevron made its final investment decision last month on the $10 billion deepwater Moho Bilondo and Moho Nord projects. These are set to deliver their first oil in 2015, and to peak at 170,000 barrels a day in 2017.

In Uganda, Tullow has recruited France's Total and CNOOC of China to develop oil. Discussions with the government over the size of an associated refinery have caused delay but plans for a 200,000 bpd pipeline that could link up with more  potentially productive wells in Kenya show its potential.

Niger, whose main international partner is China's CNPC, hopes to be producing from its Agadem block early next year, with output ramping up to 80,000 bpd.

As for today's big two producing states, Nigerian output has fallen from 2.5 million bpd in 2011 to slightly more than two million today, as theft and technical troubles plague producers. Off Angola's coast, however, Chevron last year sanctioned the $5.6 billion Mafumeira Sul field, which plans to be pumping by 2015, with maximum output estimated at 110,000 bpd.

Wood Mackenzie's oil output projections have the region's overall production in decline once more after 2018, but Kelly said this could be a function of conservative modeling.

Certainly there is no shortage of ambition, as demonstrated by Tewodros Ashenafi, an Ethiopian driller who was in London this week looking for $100 million of financing.

He sees his country as a potential 400,000-bpd producer based on geology that crosses the Red Sea from the oil-rich Middle East, and he believes the rise of indigenous companies like his privately held SouthWest Energy could be the next corporate wave for the region.

"That trend is something that's on the uptick," said Ashenafi. "We've been approached by a number of African governments to come and explore."

You May Like

Tired of Waiting, South Africans Demand Change ‘Now’

With chronic poverty and lack of basic services largely fueling recent xenophobic attacks, many in Rainbow Nation say it’s time for government to act More

Challenges Ahead for China's Development Plans in Pakistan

Planned $46 billion in energy and infrastructure investments in Pakistan are aimed at transforming the country into a regional hub for trade and investment More

Audio 'Forbidden City' Revisits Little Known Era of Asian-American Entertainment

Little-known chapter of entertainment history captured in 80s documentary is revisited in new digitally remastered format and book More

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Study: Insecticide Damaging Wild Bee Populationsi
X
April 24, 2015 10:13 PM
A popular but controversial type of insecticide is damaging important wild bee populations, according to a new study. VOA’s Steve Baragona has more.
Video

Video Study: Insecticide Damaging Wild Bee Populations

A popular but controversial type of insecticide is damaging important wild bee populations, according to a new study. VOA’s Steve Baragona has more.
Video

Video Data Servers Could Heat Private Homes

As every computer owner knows, when their machines run a complex program they get pretty hot. In fact, cooling the processors can be expensive, especially when you're dealing with huge banks of computer servers. But what if that energy could heat private homes? VOA’s George Putic reports that a Dutch energy firm aims to do just that.
Video

Video Cinema That Crosses Borders Showcased at Tribeca Film Festival

Among the nearly 100 feature length films being shown at this year’s Tribeca Film Festival in New York City are more than 20 documentaries and features with international appeal, from a film about a Congolese businessman in China, to documentaries shot in Pakistan and diaspora communities in the U.S., to a poetic look at disaffected South African youth. VOA’s Carolyn Weaver has more.
Video

Video UN Confronts Threat of Young Radicals

The radicalization and recruitment of young people into Islamist extremist groups has become a growing challenge for governments worldwide. On Thursday, the U.N. Security Council heard from experts on the issue, which has become a potent threat to international peace and security. VOA’s Margaret Besheer reports.
Video

Video Growing Numbers of Turks Discover Armenian Ancestry

In a climate of improved tolerance, growing numbers of people in Turkey are discovering their grandmothers were Armenian. Hundreds of thousands of Armenians escaped the mass deportations and slaughter of the early 1900's by forced conversion to Islam. Or, Armenian children were taken in by Turkish families and assimilated. Now their stories are increasingly being heard. Dorian Jones reports from Istanbul that the revelations are viewed as an important step.
Video

Video Migrants Trek Through Western Balkans to Reach EU

Migrants from Africa and other places are finding different routes into the European Union in search of a better life. The Associated Press followed one clandestine group to document their trek through the western Balkans to Hungary. Zlatica Hoke reports that the migrants started using that route about four years ago. Since then, it has become the second-most popular path into Western Europe, after the option of sailing from North Africa to Italy.
Video

Video TIME Magazine Honors Activists, Pioneers Seen as Influential

TIME Magazine has released its list of celebrities, leaders and activists, whom it deems the world’s “most influential” in 2015. VOA's Ramon Taylor reports from New York.
Video

Video US Businesses See Cuba as New Frontier

The Obama administration's opening toward Cuba is giving U.S. companies hope they'll be able to do business in Cuba despite the continuation of the U.S. economic embargo against the communist nation. Some American companies have been able to export some products to Cuba, but the recent lifting of Cuba's terrorism designation could relax other restrictions. As VOA's Daniela Schrier reports, corporate heavy hitters are lining up to head across the Florida Straits - though experts urge caution.
Video

Video Kenya Launches Police Recruitment Drive After Terror Attacks

Kenya launched a major police recruitment drive this week as part of a large-scale effort to boost security following a recent spate of terror attacks. VOA’s Gabe Joselow reports that allegations of corruption in the process are raising old concerns about the integrity of Kenya’s security forces.
Video

Video Japan, China in Race for Asia High-Speed Rail Projects

A lucrative competition is underway in Asia for billions of dollars in high-speed rail projects. Cambodia, India, Indonesia, Malaysia Thailand and Vietnam are among the countries planning to move onto the fast track. They are negotiating with Japan and the upstart Chinese who are locked in a duel to revolutionize transportation across Asia. VOA Correspondent Steve Herman in Bangkok has details.
Video

Video Scientists: Mosquitoes Attracted By Our Genes

Some people always seem to get bitten by mosquitoes more than others. Now, scientists have proved that is really the case - and they say it’s all because of genes. It’s hoped the research might lead to new preventative treatments for diseases like malaria, as Henry Ridgwell reports from London.
Video

Video Bible Museum Coming to Washington DC

Washington is the center of American political power and also home to some of the nation’s most visited museums. A new one that will showcase the Bible has skeptics questioning the motives of its conservative Christian funders. VOA religion correspondent Jerome Socolovsky reports.
Video

Video Armenia and Politics of Word 'Genocide'

A century ago this April, hundreds of thousands of Armenians of the Turkish Ottoman empire were deported and massacred, and their culture erased from their traditional lands. While broadly accepted by the U.N. and at least 20 countries as “genocide”, the United States and Turkey have resisted using that word to describe the atrocities that stretched from 1915 to 1923. But Armenians have never forgotten.
Video

Video Afghan First Lady Pledges No Roll Back on Women's Rights

Afghan First Lady Rula Ghani, named one of Time's 100 Most Influential, says women should take part in talks with Taliban. VOA's Rokhsar Azamee has more from Kabul.
Video

Video New Brain Mapping Techniques Could Ease Chronic Pain

From Boulder, Colorado, Shelley Schlender reports that new methods for mapping pain in the brain are providing validation for chronic pain and might someday guide better treatment.

VOA Blogs