How to Keep African Oil, Gas Industry Strong
The African Energy Chamber (AEC) has officially launched the second edition of its African Energy Outlook 2021, which details all of the major challenges facing African oil and gas stakeholders, as well as workable solutions that will keep the industry on a strong and stable growth path.
Africa’s oil and gas industry is facing extraordinary circumstances. An ongoing energy transition and new efforts to decarbonize the world are weighing on oil demand. The shale revolution is exacerbating these pressures. And of course, the COVID-19 pandemic has wrought havoc on markets around the world, accelerating and intensifying existing trends.
Restrictive fiscal regimes, inefficient and carbon-intensive production, and difficulties in doing business are preventing the industry from reaching its full potential.
According to the Executive Chairman of the African Energy Chamber, NJ Ayuk, to remain competitive, African producers and governments must cut red tape to make life easier for hardworking Africans, businesses and investors to work and grow the energy sector.
“We know from experience this will reduce the cost of doing business, speed up approvals and make life better for Africans,” he said. “We must never be ashamed of supporting an industry that has brought so much to Africa and will continue to bring people out of poverty and reduce reliance on foreign aid.
“We believe the short-term outlook will improve if countries apply more competitive fiscal regimes. Emissions can be reduced by curbing flaring and monetizing gas, improving and future-proofing the carbon profile of African petroleum production.”
The world still needs oil and gas, and Africa still holds enormous untapped potential.
Ayuk believes that developing gas-to-power infrastructure will increase access to affordable energy for all sectors of the economy, offering massive knock-on benefits and making it easier to do business.
“Reducing lead times to limit risk premiums put on long cycle projects will further bolster the industry’s viability and growth prospects” he said noting that “It will not be easy, but these reforms are necessary.”
The full report can be read here