Oil & Gas


AFRICA'S DEEPWATER OIL AND GAS PRODUCTION EXPECTED TO SEE SIGNIFICANT GROWTH OVER THE NEXT DECADE.

Irene Jerry
4 weeks, 1 day

Africa’s deepwater oil and gas production is poised for significant growth over the next decade, fueled by recent discoveries and new projects. Exploration successes in Namibia and Côte d'Ivoire have sparked increased interest in deepwater activities across the continent.

However, to fully unlock Africa’s deepwater potential, issues such as security risks and the need for more attractive fiscal incentives must be addressed.

The deepwater sector has long been a crucial component of Africa’s hydrocarbon production, contributing between 20% and 25% of the region’s output over the past decade. This share is expected to grow to between 35% and 40% by 2035.

Rystad Energy estimates that by 2035, under-construction and pre-FID (Final Investment Decision) projects will add approximately 3.5 million barrels of oil equivalent per day (boepd) to Africa's deepwater supply.

Recent successes in countries like Namibia and Côte d'Ivoire have spurred greater interest in exploring Africa’s deepwater potential. Other nations such as São Tomé and Príncipe, Liberia, and Sierra Leone are also emerging as important areas for future exploration.

Between 2015 and 2019, Africa saw a significant increase in deepwater resource sanctioning, with major discoveries such as Eni’s Zohr field in Egypt and TotalEnergiesMozambique LNG project pushing forward.

However, post-COVID-19, deepwater sanctioning activity slowed down, with annual sanctioned resources falling to around 330 million barrels of oil equivalent (boe) compared to nearly 1.9 billion boe in the previous five years. Despite this, successful projects in Namibia, Côte d'Ivoire, Mozambique, and Nigeria signal a potential new wave of deepwater developments.

If these projects stay on track, Africa could see its deepwater resource sanctioning exceed 2 billion boe annually between 2025 and 2029, with potential to reach over 3 billion boe. To achieve this, however, additional fiscal incentives and improved security for onshore infrastructure will be essential. Additionally, the prioritization of the most lucrative projects by major companies will shape the future of the sector.


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