According to the research and consulting from GlobalData, we could be looking at as many as 43 crude and natural gas projects in Sub-Saharan Africa by 2025 (31 crude and 12 natural gas).
This list is likely to be headed by Nigeria (11 projects) and Angola (8 projects).
Even though the region has shown a recent downtrend in investment, the projects will come online by midterm, especially in the areas where the investment was made before the downturn in oil and investment started. This will particularly be evident in investments which show breakeven options or prices lower than the current values.
3 international firms are of particular interest in relation to the investment. They are:
- Tullow Oil PLC: 5 planned projects
- Total S.A.: 5 planned projects
- Chevron Corporation: 3 planned projects
Out of the 10 projects planned jointly by Tullow Oil PLC and Total SA, 9 are in crude oil and 1 in natural gas.
It has been reported that the key planned projects in the region would contribute to around 1.1 million barrels of oil on a daily basis (BD) and 7.7 billion cubic feet of gas.
The Capital Expenditure (Capex) influx in the region is expected to be around USD 153.5 billion, with Mozambique leading the growth spurt with an estimated investment of USD 70.4 billion. Most of this is reserved for the Rovuma Area 1 and the Rovuma Area 4 complex.
Commenting on the developments in Mozambique, GlobalData’s Upstream Analyst, Jonatham Markham observed, “Progress on the liquefied natural gas (LNG) projects in Mozambique has slowed over the last few years due to financing issues and regulatory uncertainty. The operators are expected to start with relatively small scale developments, such as Eni’s 3.4 million metric tons per annum (mmtpa) floating liquefied natural gas (FLNG) solution”.
He also noted that the initial build-up would be affected by the initial lower investment, which would likely reach a combined capacity of 30 mmpta by 2025. The Final Investment Decision (FID) for FLNG is expected by the end of 2016, while that of the onshore facility and the LNG exports from Mozambique will likely start off by 2017 and 2021 respectively. In this regard, Eni SpA will have the highest Capex investment (USD 21.3 billion) in the next 10 years.
A few of the undeveloped regions in the Niger Delta basin include Zabazaba-Etan and Nsiko.
According to Young Okunna, an Upstream Analyst from GlobalData, “Although Nigeria is expected to add over 510,000 bd of additional oil production capacity by 2025, the likelihood of this happening is dependent on fiscal certainty and relative peace in the Niger Delta region. Almost half of the expected additional capacity still lacks FID, with the field operators expected to make a decision by 2020. This will be greatly influenced by prevailing market conditions and security around the planned projects.”