Navigating Opportunities: Europe’s Role in Africa’s Oil and Gas Industry

Since early discoveries of oil and gas in Africa, European operators and service providers have made substantial investments in unlocking the continent’s hydrocarbon resources. Amid global market changes – whereby energy demand outweighs supply and efforts to diversify value chains pinpoint new producers – Africa’s oil and gas landscape has become an increasingly attractive investment destination.

The upcoming Invest in African Energy (IAE) forum in Paris – organized by Energy Capital&Power with the support of the African Energy Chamber – serves as a bridge between European financiers and technology providers and African energy projects. Scheduled for May 14-15, 2024, the event aligns with the prevailing industry landscape, in which cross-border cooperation and synergies have become vital to sustainable energy development.

A Commitment to African Oil Development

European E&P companies continue to make great strides toward opening up the African oil market. In established markets like Angola, France’s TotalEnergies (https://apo-opa.co/419BoZI) is developing several deepwater fields, rolling out a multi-year strategy that hinges on new investments in exploration. Norway’s Equinor is a partner in three Angolan producing blocks, recently signing a production sharing agreement for Block 31/21 (https://apo-opa.co/4a14TB4), while Italy’s Eni has resumed operations (https://apo-opa.co/46PJAQd) at three exploration blocks in Libya.

In emerging markets, exploration is rapidly expanding. TotalEnergies is exploring offshore South Africa – having recently been granted environmental approval to drill – and in Namibia’s Orange Basin, where the company made a sizable discovery (Venus-1X) in 2022. Similarly, British multinational Shell made four discoveries (https://apo-opa.co/41iFi2D) offshore Namibia between 2022 and 2023 – the Graff-1, La Rona-1, Jonker-1X and Lesedi-1X wells. TotalEnergies announced (https://apo-opa.co/4197jtu) that it is investing almost 50% of its global exploration budget in Namibia, while nearly a quarter of Shell’s deepwater spending (https://apo-opa.co/4a7Vqb8) in 2023 and 2024 will be directed towards the country. During the IAE forum in Paris, discussions will center on enhanced collaboration in the field of exploration, as well as the significance of signing new deals and driving investment into Africa’s upstream sector.

Advancing Africa’s Energy Transition through Gas

With over 620 trillion cubic feet of gas resources – and on the back of rising global gas demand – Africa represents a strategic investment opportunity for natural gas players. Dubbed “ the fuel of the future” for the continent, gas offers a unique opportunity for the continent to meet its energy access goals while transitioning to cleaner energy solutions. European companies – both E&P and technology providers – are investing heavily in this industry, with several large-scale projects progressing.

France’s Technip Energies is contributing to the development of the Greater Tortue Ahmeyim (GTA) Liquefied Natural Gas (LNG) project in Senegal and Mauritania, while the Eni-led Coral Sul Floating LNG project in Mozambique achieved its first cargo delivery in 2022. TotalEnergies is a partner on the Angola LNG project alongside bp and Eni – through their joint venture Azule Energy – while Equinor and Shell are developing the Tanzania LNG project. IAE 2024 will provide an update on these projects, while serving as a platform for new deals to be signed and projects to be sanctioned.

Focus Shifts to Capacity Building

Notwithstanding project development, European companies are playing an increasingly important role in capacity building in Africa’s oil and gas industry. Building on established partnerships with African stakeholders, European partners have actively contributed to skills and technology development through various training programs and initiatives. Notably, Technip Energies (https://apo-opa.co/3TehNFT) works closely with Senegalese government agency COS-Petrogaz to advance capacity building; TotalEnergies has various workforce training initiatives in place across its operations; while Shell, Eni, Equinor and many more continue to invest in infrastructure and local content.

As foreign investment in African energy rises, continental players are committed to ensuring oil and gas developments translate into tangible economic and employment opportunities for local populations. Accordingly, local content has emerged as a central component of project development. Organized by Energy Capital&Power, the IAE 2024 forum presents a unique opportunity for European and African players to directly engage on such topics, with the event fostering mutually beneficial partnerships between local and international stakeholders.

Visit www.Invest-Africa-Energy.com for more information about this exciting event.

Distributed by APO Group on behalf of Energy Capital&Power.