Is Africa becoming the future of oil and gas?

0
287
Oil producing country in Africa
For More Enquiry: 08052442020

Africa, despite challenges, can truly be seen as the future of oil and gas

Africa has never really had a strong voice in shaping global oil and gas industry despite being home to 8 percent of the world’s proven crude reserves, after Middle East, Latin America, and North America.

This is because the continent is seen as a depot for natural resources.It has no real control of her natural resources, and does not consume a large part of the said resources.

Crude oil and natural gas are clearly two of the most important resources extracted in the continent because of the immense economic benefits derived from their exploration and production.

Experts postulate that Africa could be the future of the oil and gas industry as most of the recent oil discoveries were in African countries such as Uganda, Kenya, Senegal, Ghana, Congo amongst others, but unless oil rich African countries take control by steering their oil and gas industries in the right direction, the resource might continue to appear a “curse” rather than a “blessing.” This may only become feasible by theoil rich African countries pulling together in a common alliance as well as by developing their individualindigenous competences and growingvirile local content capacities.

Guillaume Doane, chief executive officer of Africa Oil and Powerin an exclusive interview asserted that “we have to be cognizant of the fact that Africa is the future of the oil and gas industry, where are the new oil and gas producers of the world coming from? They are coming from Africa.”

In the past decade, a number of African countries have discovered crude oil and natural gas in viable commercial quantities and are looking forward to exploration and production.Some, like Nigeria have been very serious in developing her local contentin the various relevant areas of oil production activities, since 2010.

For example, in 2006, Harman Resources discovered commercially viable petroleum reserves in Uganda, and since then a total of 6.5 billion barrels of crude oil have been proven. Also, in Kenya, oil was first discovered in 2012, and the east African country hopes to produce as experts put its reserves estimate between 700 million barrels to 1 billion barrels of crude.

Senegalese government also discovered crude in commercially viable quantity in 2014 between 250 million to 2.5 billion barrels of crude oil.

A step in the right direction which most current and yet to start African oil producers have realized is the importance of forming coalitions. Despite the fact that these oil producers individually don’t produce record levels like the U.S., Saudi Arabia or Russia, it is starting to dawn on them that issues that concern Africa will not be addressed until African producers are seated at the table.

A prime example is the increasing African presence in the organization of petroleum exporting countries (OPEC). On this Doane said that “we are in a global oil and gas situation, and African producers have realized that it is either you have a sit at the table or you are stuck between what is going on in OPEC and North America which is really a push and pull situation, because non-OPEC production has been increased almost year on year since 2010.”

OPEC is an oil and gas cartel comprising of 16 countries, from Latin America, Middle East and Africa, 7 out of the 16 countries are African, thanks to Congo the newest member of the group and this change has been described as “unprecedented” by Doane, because despite the fact that large producers will always have more pull, some African producers have never been given the opportunity to partake in that level of international oil and gas markets.

Also, according to U.S Energy Information Administration, currently, Africa as a continent still has a small share of the total crude reserves in comparison with Middle East’s 43 percent and Latin America’s 20 percent of the world’s crude reserves, and a united voice is noted to have more pull than individuals.

“I think African producers have recognized the need to join other producers to pursue their strategic interests,” Doane explained.

“Let’s remember that maybe by themselves, Equatorial Guinea, Uganda, Cameroon and other small producers can’t say a lot but together, they put a really powerful message.”

The continent also produces about 10 percent of the world’s crude output, which is a significant amount when it comes to global oil prices; this is another reason for the pressing need for the oil producing economies to forge ahead and take control of their oil and gas industries, experts advised.

In an attempt to furthergalvanize Africa’s energy resources comparatively through a coalition, African oil and gas producing countries came up with the African Petroleum Producers Organization (APPO). This is an organization of African petroleum producing countries. It was created on January 27, 1987 in Lagos, Nigeria, to serve as a platform for cooperation and harmonization of efforts, collaboration, sharing of knowledge and skills among African oil producing countries. The headquarters of the organization is in Brazzaville in the Congo. The Organization changed its name from African Petroleum Producers Association to African Petroleum Producers Organization in 2017. [1]

The founding of APPO was spearheaded by Nigeria as an effort to mitigate the nation’s dependency on Western technology and Western markets for oil export revenues. The objective of APPO is to promote cooperation in petrochemical research and technology.

Share Buttons
For More Enquiry: 08052442020

LEAVE A REPLY

Please enter your comment!
Please enter your name here