Africa

EGYPS 2023 saw the launch of the IGU’s Gas for Africa Report 2023, which assesses the potential for domestic gas resources to energise Africa.

» For the 6th consecutive year, Egypt hosted Egypt Petroleum Show (EGYPS) 2023, under the patronage of His Excellency Abdel Fattah Al Sissi, President of Egypt. Its theme was North Africa and The Mediterranean: Supporting Sustainable Global Energy Supply and Demand. EGYPS is at the heart of the African and Mediterranean oil, gas and energy conversation, and a platform that can convene global industry leaders.

» The International Gas Union (IGU) in collaboration with EGYPS launched the new Gas for Africa Report at the conference, sharing the key findings of a thorough study that produced by the IGU in partnership with Hawilti Ltd. The report assesses the potential for domestic gas resources to energise Africa in a way that supports the global energy transition. The African Energy Commission (AU-AFREC) and the Africa Finance Corporation endorse the report’s findings.

» The report launch session was a great occasion to discuss opportunities of gas development for the African continent, insights into its potential, key drivers, immediate barriers, and solutions of developing natural gas value chains in Africa to address energy poverty and climate change.

in Russian supplies and support the EU’s quest to end dependence on Russian energy. Recent European investments in the gas sector worth billions of dollars in Algeria have reached closure in the first quarter of 2023.

» The future outlook for North African gas is mixed, however, especially regarding its relevance to Europe. With further reforms aimed at spurring investment in the local sector and boosting production and exports while curtailing growth in domestic demand, the region could expand its role as a gas exporter. If that does not materialise, however, the EU will need to look elsewhere for additional supplies to replace sizable Russian gas purchases.

Following a series of massive offshore gas discoveries, there is great attention on East Africa’s untapped potential.

» Home to six of the 10 poorest nations globally, East Africa has long captured the world’s attention for the wrong reasons. But since a series of massive offshore gas discoveries in Mozambique and Tanzania in 2010 and thereafter, the region’s fortunes are being recast.

» Mozambique LNG, one of the main gas projects in the country, saw a $20bn final investment decision (FID) in 2019 – a year in which the country’s gross domestic product (GDP) was only $15.4bn. Several big names in the oil and gas industry are already there, including France’s TotalEnergies, Italy’s Eni, Norway’s Equinor, the US’ ExxonMobil and China’s state-owned China National Petroleum Corporation (CNPC).

» In two pieces of good news for Europe from Mozambique, the first shipment of LNG from the FLNG plant took place in the fourth quarter 2022, while TotalEnergies plans to resume its investment in its LNG train, with the first shipments expected in 2024.

exporters. However, policy reforms in both Mozambique and Tanzania would be necessary to count them as reliable LNG suppliers.

In West Africa, Senegal is set to emerge as a key gas exporter at the end of next year, while Nigeria hopes to better capitalise on its own reserves through the Trans-Sahara Gas Pipeline project.

» Senegal is in third place behind Nigeria and Algeria in terms of the size of its gas reserves in Africa. Senegal and Mauritania’s coastline is estimated to contain about 50 tcf of gas, however, production is not expected to start until the end of next year.

» Nigeria has Africa’s second largest natural gas reserves, though it accounts for only 14% of EU imports of LNG. Projects face the risk of energy thefts and high costs. In Nigeria, ambitious plans have yet to yield results despite years of planning. The country exported less than 1% of its vast natural gas reserves last year. A proposed 4,400-km-long pipeline that would take Nigerian gas to Algeria through Niger has been stalled since 2009, mainly because of its estimated cost of $13bn. Many fear that even if completed, the TransSahara Gas Pipeline would face security risks like Nigeria’s oil pipelines, which have come under frequent attacks from militants and vandals.

While Africa’s natural gas reserves are vast and North African countries like Algeria have pipelines already linked to Europe, a lack of infrastructure and security challenges have long stymied producers in other parts of the continent from scaling up exports. Alreadyestablished African producers are cutting deals or reducing energy use, so they have more to export to boost their finances, but some leaders warn that hundreds of millions of Africans lack electricity and supplies are needed at home.

» Algeria dedicates 83% of its gas exports to Italy and Spain. Together with Egypt, it is the largest producer of natural gas in Africa. And 20% of Europe’s natural gas imports come from the region. North Africa has stepped up as a supplier of additional gas to alleviate Europe’s exposure to disruptions

» Moreover, Tanzania also has more than 60 tcf in gas reserves, and it is close to finalising a $30bn investment in an LNG export terminal, with construction due to begin in 2027 and first exports by 2030.

» The region’s standing in the growing global LNG market is not insignificant and has received a considerable boost following the war in Ukraine and the EU’s quest for new gas