Africa's New Oil Producers Line Up - African Business Magazine
Africa’s New Oil Producers Line Up

Africa’s New Oil Producers Line Up

As with Nigeria, Angola is set to benefit from a string of new oil field developments. BP, Chevron, ExxonMobil and Total are developing projects that will provide production capacity of up to 2.3m b/d and which could take total Angolan output up to 4m b/d by 2017.

This would position both Nigeria and Angola among the world’s biggest oil exporters, behind Saudi Arabia and possibly Russia. Again, as in Nigeria, almost all projects are deepwater fields where new technology is enabling production for the first time.

Elsewhere, the government of Ghana has approved the expansion of the Jubilee Project, which is being developed by a consortium led by Tullow Oil. Eight new wells will be drilled over the next 18 months in an effort to stabilise production at about 125,000 b/d, although output will be doubled in the longer term. Other oil projects, including the Teak Field, are expected to be developed in Ghanaian maritime territory close to Jubilee. A test well drilled on Teak by one of Tullow’s partners, Kosmos Energy, in November revealed that the field was bigger than previously expected.

It would be no surprise if the government of Ghana were to benefit from production in excess of 400,000 b/d within five years, making it the third-biggest oil producer in sub-Saharan Africa, behind Nigeria and Angola.

Will Kenya join the club?

While Uganda and Tanzania both stand on the verge of substantial oil and gas production, Kenya is hoping against hope that it can join them. In January, Canadian firm Africa Oil began drilling the Ngamia 1 exploration well in the Lokichar Basin, part of the Great Rift Valley, in conjunction with its partners.  More than 1bn barrels have been discovered to date.

Africa Oil has also begun drilling in the semi-autonomous province of Puntland in northern Somalia, alongside partners Range Resources and Red Emperor of Australia.

Tullow has announced that it will begin oil production in Uganda next year, although output will be very modest and supplied exclusively to local power plants. However, production is expected to reach 200,000 b/d when an export pipeline is developed, although details of the project have not yet been hammered out.

The Juba government is keen to secure an oil export route that avoids Sudanese territory, as its current dependence on the existing pipeline to Port Sudan is continuing to affect relations with Khartoum. Juba has accused the government of Sudan of not distributing oil revenues fairly, while conflict over the sovereignty of the Abyei Region has still not been settled.

In a move that took industry watchers by surprise, Juba has signed an oil pipeline deal with Kenya and says its will foot the bill.

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Written by African Business Magazine

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