The outlook for African oil in 2023 is promising. The State of African Energy Q1 2023 Report provides several key insights into African oil production for the remainder of the year and details the emerging trends shaping the global oil economy. It also highlights Africa's role in meeting global demand.
A few years ago, the African energy industry was in survival mode. The COVID-19 pandemic had virtually eliminated demand for crude oil and African exports had fallen sharply.
Therefore, while many African states are still feeling the wounds inflicted by COVID, I am encouraged to learn that Africa's liquids supply in 2023 reached nearly 7 million barrels per day (mbpd), more than 430,000 barrels per day (bpd) higher than Africa's 2020 lows of about 6.55 mbpd.
These advances are among the topics covered in the African Energy Chamber's soon-to-be-released "State of African Energy Q1 2023 Report. The report details the emerging trends shaping the global oil economy and highlights Africa's role in meeting global demand.
Russian energy supplies to Europe continue to decline as a result of the war in Ukraine, Africa is poised to increase its oil and natural gas exports to the continent, and African oil supplies are expected to remain stable through 2023 and beyond.
While the majority of Nigeria's and Angola's production comes from offshore projects, Algeria, Libya and Egypt's production comes from their respective onshore fields. Libya is expected to increase production in 2023 as the civil war subsides.
New projects throughout the continent will be added to the offer in 2023
A number of new projects are expected to boost African supply in 2023.
In Senegal, the Sangomar field development, which was 60% complete last September, is expected to produce its first barrel of oil this year. The $4.6 billion project, led by Woodside Energy in partnership with Senegal's national oil company Petrosen, is expected to produce about 231 million barrels of oil during its first phase of development, with total recoverable oil resources estimated at about 500 million barrels over its life.
In Nigeria, Shell's Bonga North project, which could hold up to 525 million barrels of crude, could help the country boost production to pre-pandemic levels. Nigeria's production is rebounding, reaching a one-year high of 1.44 million barrels per day in February and accounting for two-thirds of OPEC's oil production increase that month.
Thanks to a $10 billion investment by TotalEnergies, the Lake Albert development in Uganda, along with the Tilenga and Kingfisher projects and the 1,500 km East African Oil Pipeline (EACOP), are expected to produce up to 230,000 barrels per day.
First barrel in Senegal, production to forget in Ghana, rebound in Nigeria
Ghana is expected to double its production to more than 400,000 barrels per day thanks to recent discoveries in the Deepwater Tano Cape Three Points block, operated by Norway's Aker Energy. Ghana will play an important role in the region's prospects this year as it will also reopen its 45,000 barrel per day Tema oil refinery.
Angolan production soared to 34.29 million barrels in January, an increase of more than 580,000 barrels from the previous month. Its capacity has more than tripled since the completion of the rehabilitation and expansion of its 65,000 barrel per day Luanda refinery.
These impressive numbers represent a significant growth trend for Africa by 2023. With more than 70 oil and gas projects scheduled to come online by 2025, analysts predict that Africa could produce as much as 2.3 million barrels of crude per day by 2025.
The data and forecasts in our State of African Energy Q1 2023 Report paint an encouraging picture of the African energy industry. In a turbulent global oil and gas market, the continent's oil production is stable and growing. Our oil and gas industry is poised to breathe new life into our economies and create new opportunities for Africans in 2023.
By NJ Ayuk