Over the past twelve months, the Middle East’s oil and gas heavyweights – Saudi Arabia, the United Arab Emirates (UAE) and Qatar – have accelerated their involvement across Africa’s energy value chain. Starting with diplomatic visits that turn into tangible cooperation agreements and planned investment campaigns, Gulf countries have cemented their interest in competing for Africa’s untapped hydrocarbon resources, which make up about 13% of natural gas reserves and 7% of of oil reserves worldwide.
The Invest in African Energy (IAE) 2024 forum – taking place in Paris on 14-15 May – will bring together Africa’s leading energy projects to pitch to global buyers for partnership and investment. The forum acts as a central platform for Gulf energy companies and developers to access the latest data and project specifications directly from African energy ministers and authorities, with the aim of unlocking mutually beneficial partnerships and new energy financing.
Saudi Arabia
With plans to invest up to $25 billion in Africa by 2030 through the Public Investment Fund, Saudi Arabia is positioning itself as a long-term partner on the continent and driving integrated developments across Africa’s oil and gas value chain. More than 50 projects worth more than $500 million were signed between Saudi Arabia and African nations in November 2023, with investments mainly directed to the energy, mining and infrastructure sectors. The agreements included energy cooperation agreements with Senegal, Chad, Rwanda and Ethiopia, as well as a financing agreement with Mozambique to build public infrastructure.
In Nigeria, Saudi Arabia has pledged to invest in revitalizing Nigeria’s oil refineries and provide financial support to boost downstream production capacity. In January, the two countries launched the National Manpower Training Program for the Adoption of Liquefied Petroleum Gas (LPG), which is set to lead to the joint development of LPG micro-distribution points across Nigeria’s Edo State. Meanwhile, the Kingdom is in talks with South Africa to build a refinery and ease domestic fuel shortages.
UAE
While Saudi Arabia may be leading diversified investment across Africa, the UAE is not far behind. Last December, the United Arab Emirates signed an agreement with Morocco to develop the Africa-Atlantic gas pipeline, which will carry Nigerian gas to North Africa and then to Europe. Through its sovereign wealth fund in Abu Dhabi, the country will help mobilize financing for the pipeline, which could also connect emerging gas players such as Senegal and Mauritania to new markets. Seeking to expand into Africa’s natural gas industry, Abu Dhabi National Oil Company is said to be in talks to acquire Galp’s 10% stake in Mozambique’s Rovuma LNG project, which is set to tap three gas reservoirs in the basin’s Area 4 block Rovuma to produce 18 million tons of LNG per year.
The UAE’s growing role on the continent also goes beyond direct investment, allowing African countries to tap into international financial markets. Positioned as a strategic commercial center with easy access to the Middle East, Asia, Europe and Africa, Dubai is well connected to both global sources of capital and emerging markets seeking investment.
Catarrh
Qatar is also ramping up its activities on the continent through upstream exploration. In April 2023, state-owned QatarEnergy acquired a 40% stake in offshore Block C-10 in Mauritania – home to the Walata, Banda and Tevet oil discoveries – in partnership with Shell and Mauritania’s national oil company SMH. With over 28.3 billion cubic meters of proven natural gas reserves, Mauritania could become the third largest natural gas exporter in Africa, after Nigeria and Algeria. The acquisition not only confirms the prospect of Mauritania’s offshore oil and gas fields, but also Qatar’s interest in expanding its exploration footprint on the continent.
QatarEnergy is playing an active role in the continent’s latest hydrocarbon discoveries – notably offshore Namibia, where the company holds stakes in three exploration licences. Its PEL 39 – in which it has a 45% interest, in partnership with Shell (45%) and the National Petroleum Corporation of Namibia (10%) – has yielded four consecutive discoveries between February 2022 and July 2023. These discoveries – Graff- 1, La Rona-1, Jonker-1X and Lesedi-1X – are now turning Namibia into one of the leading hydrocarbon markets on the continent, with further testing and appraisal work underway.
Distributed by APO Group on behalf of Energy Capital & Power.
Energy Capital & Power Organization, IAE 2024 (https://apo-opa.co/49krKXM) is an exclusive forum designed to facilitate investment between African energy markets and global investors. Taking place 14-15 May 2024 in Paris, the event offers delegates two days of intensive engagement with industry experts, project developers, investors and policy makers. For more information, visit www.Invest-Africa-Energy.com.For sponsorship or participation as a representative, please contact [email protected].