Major oil and gas discoveries and subsequent investments in infrastructure projects are set to help the oil and gas industry in Africa to grow, also helped by improved governance and regulation, PwC said in its newly released Africa oil & gas review 2019.
Rising investor interest in Africa's oil and gas resources, renewed investment in exploration after the downturn, and major new finds offshore the continent are expected to shift African oil and gas development into a growth phase after years of stagnation, according to PwC.
This year, Angola, Cameroon, Democratic Republic of Congo, Equatorial Guinea, Ghana, Mozambique, Nigeria, Republic of the Congo, Senegal, Sierra Leone, Somalia, South Sudan, and Uganda announced bidding rounds, PwC's report showed. Africa is offering more than 220,000 square kilometers (84,942 square miles) of acreage, primarily located offshore.
"Renewed optimism has returned to Africa's oil & gas industry on the back of a rebound in prices and increased investor interest," said Andries Rossouw, PwC Africa Energy Utilities & Resources Leader.
"The African oil & gas industry has been through some difficult and challenging years in the wake of the oil price crash. However, the industry has restructured itself and is more competitively placed in terms of efficiency and operational performance," Rossouw noted.
Yet, in order to fully capitalize on the renewed investor interest, African nations needs to urgently make progress in tackling corruption and improving corporate governance, James Mackay, PwC Director Capital Projects & Infrastructure, said.
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The focus in the coming years will be liquefied natural gas (LNG) developments offshore Mozambique, which has seen several major natural gas discoveries over the past few years.
"One of the most dramatic finds in Africa over the past decade is Mozambique's natural gas estimated at over 180 tcf, which has already unlocked the first three large-scale LNG projects," according to PwC.
These projects and additional exploration could make Mozambique the world's third-largest LNG producer after Qatar and Australia by 2030, PwC says.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews. More