SURVEY: Africa faces decline in oil output but there may be better news for gas

• Published date: 01 May 2017
• DOI: http://doi.org/10.1111/oet.12479
• Date: 01 May 2017

SURVEY

A survey of Africa’s oil and gas production and the prospects for growth by Oil and Energy Trends’ Consulting Editor,

Dr Paul McDonald

Africa faces decline in oil output but there may be better news for gas

Africa accou nts for about 8% of the world’s proven oil

reserves and 9% of its production. For natur al gas, the

respective numbers are 9 and 6%. Product ion of both

is concentrated in a small number of countries. Oil is

mainly produced in North and West Africa, as is gas.

In most countries, oil production is either static or in

decline, althoughone or two small producershave scope

to increase their output.

Natural gas production has risen over the last decade,

although much of the increase has come from West

Africa. Output in the largest African producer, Algeria,

is falling. East Africa, however,could emerge as a signi-

cant producer and exporterand the prospects look good

for Egypt, following recent discoveries oshore.

Oil

Output falling

In 2016, African production of crude oil and natural gas

liquids (NGL) was down by 2.4 mnbpd from its high of

2007 (see TableE). e largest declines include Libya and

Nigeria, both of which have been aected by violence,

including attacks on oil installations. Libya’s decline of

1.4 mn bpd was the largest of any African country. Nige-

ria’sproductionwentdownby0.4mnbpd.Algerianpro-

ductionalsofellby0.4mnbpd,largelybecauseofthe

natural decline of its oldest oil- and gaselds, which has

led to a fall in both crude oil production and NGL.

Equatorial Guinea has seen its production roughly

halve to 0.2 mn bpd, having peaked at 04 mn bpd

in 2005. South Sudan and Sudan suered a fall of

0.3 mn bpd in the ir combined production . Sudan

became two countries in July 2011 when South Sudan

declared its independence. ere has been conict

between the two countries ever since, along with armed

rebellioninSouthSudan.

In a few cases, oil production has increased since 2007,

notably in Angola and Congo (Brazzaville), each with a

rise of 0.1 mn bpd. In addition , Ghana has emerged as an

oil producer in that time, with an output of 0.1 mn bpd.

ElsewhereinAfricatherehasbeenlittlechangeinoutput

since the high of 2007.

Concentration of reserves

As with production there is a concentration of proven

oilreservesinafewAfricancountries.elargesttotal

is held by Libya, with 48.4 bn barrels, accounting for

some 38% of the total. Aer Libya comes Nigeria, with

37.1 bn bbl: 29% (see Ta b le F ) .

Table E

Africa: Oil Production, 2007 and 2016

Country Production∗

2006 2016 Change

(mn bpd)

Algeria†2.0 1.6 (0.4)

Angola†1.7 1.8 0.1

Chad 0.1 0.1 –

Congo (Brazzaville) 0.2 0.3 0.1

Egypt 0.7 0.7 –

Equatorial Guinea 0.4 0.2 (0.2)

Gabon†0.2 0.2 –

Ghana – 0.1 0.1

Libya†1.8 0.4 (1.4)

Nigeria†2.3 1.9 (0.4)

South Sudan‡0.5 0.2 (0.3)

Sudan‡

Tunisia 0.1 0.1 –

Others 0.2 0.2 –

Total 10.3 7.9 (2.4)

∗Includes NGL

†OPEC member

‡The two did not become separate countries until 2011

Totals rounded

Source: (2007) BPStatistical Review of World Energy ,2016

(2016) Author’s estimate

e next two countries in terms of size of their

reserves are Algeria, wit h 12.2 bn bbl and A ngola, which

has 8.3 bn barrels; then come the two Sudans, with

5.0 bn bar rels and Gab on, at 2.0 bn bbl. Of the top-eight

countries, ve belong to OPEC, and these account for

108.0 bn bbl out of a total of 119.9 bn bbl.

Undeveloped reserves

e main undeveloped reserves lie onshore in North

Africa and in the d eep oshore in West Africa. East

Africa is mainly gas-prone, although there are some

undeveloped oil reser ves in Uganda, and large reserves

of heavy and extra-heavy crude have been identied on

Madagasc ar.

North Africa

Most of North Africa’s oil reser ves are onshore or in shal-

low water.e p otential for further nds is considerable

across the Sahel. Little exploration has taken place out-

side Egypt, Libya, Algeria, and Tunisia. e main eort

elsewhere has been in Chad, where proven reserves of

1.5 bn bbl have been identied (see Tab l e F ). H o we v er,

© 2017 John Wiley& Sons Ltd