By NJ Ayuk, Government Chairman, African Power Chamber (
I’ve mentioned for years that African power is a crucial funding. Backers clearly agree — to the tune of USD47 billion. That’s how a lot capital expenditure (capex) 2024 noticed in African oil and gasoline, displaying a 23% improve from final 12 months. Higher but, we count on development to proceed by means of the tip of the last decade.
This capex exercise is a welcome signal that power majors are deepening their long-term pursuits in Africa. And as our 2025 State of African Power report particulars, their momentum has created distinctive alternatives for native communities, indigenous firms, and nationwide oil firms (NOCs) from different continents.
Rising Gamers
Whereas the vast majority of 2024’s capex was pushed by established producers like Angola and Nigeria, rising gamers are making noise within the trade. Take Senegal, which noticed its first offshore oil manufacturing this 12 months. Ghana, following a five-year droop, elevated oil output throughout 2024 by 10% and gasoline output by 7%.
Exploration hotspot Namibia additionally deserves a particular point out: The Southern African nation goals todrill over 12 offshore wells subsequent 12 months, start manufacturing by 2029, and grow to be one of many top-five African producers by the 2030s. Good work for a nation that solely found its monumental reserves in 2022! I regularly cite Namibia as a result of it proves {that a} full newcomer can entice severe international funding with sensible, swift coverage modifications — and poise itself to shake up the power trade.
Elevated Exploration
An thrilling query stays: Simply the place will we discover the following Namibia? Because of a resurgence in exploration, one other hotspot could also be across the nook. There have been 1,060 wells drilled in Africa this 12 months — greater than any time since 2015. Africa has additionally grow to be a worldwide chief in drilling high-impact wells, which have the potential to considerably improve total reserves. That technique is already paying off: Notable 2024 finds embody Namibia’s Mopane advanced, which holds roughly 10 billion barrel of oil equal (boe) – “one of many world’s largest offshore finds,” in accordance with Offshore Journal. Even whereas world exploration as a complete stays stagnant, Africa is stepping as much as meet rising power calls for.
When exploration is profitable, new fields observe. We additionally count on to see African greenfield spending exceed brownfield by 10% by 2030. These capex developments all display that traders received’t restrict themselves to mature fields: Eyes are on contemporary places, contemporary amenities, and contemporary alternatives in Africa.
A Fuel Future
As we spotlight in our 2025 report, a type of alternatives is pure gasoline. Africa holds almost 18 trillion cubic meters of reserves, which can show important for a simply power transition as pure gasoline can present vital near-term emissions reductions whereas fostering power safety and financial improvement. International demand for this clean-burning useful resource can also be rising, significantly in Asia. That’s why I’m glad to see a better emphasis on growing pure gasoline assets. In 2023, capex spending on pure gasoline was about 30%, however that is projected to develop 10% by 2030. It’s one other signal that extra traders are considering in the long run about Africa, and interested by being a part of a simply power transition.
Take Senegal, the place the Larger Tortue Ahmeyim gasoline subject will start manufacturing subsequent 12 months. A Remaining Funding Choice can also be anticipated in 2024 on Yakaar-Teranga. The West African nation is one other implausible instance of how operator-friendly insurance policies, political stability, and huge reserves can entice vital international funding: I’m excited to see Senegal rework itself from an oil importer to a gasoline exporter.
M&A Alternative
The previous 12 months noticed an enormous improve in divestment by O&G majors: Giant IOCs are aggressively streamlining their African portfolios. As a rule, they’re promoting mature, high-emission, and high-cost property. Whereas massive divestments typically sign bother, they’re really creating some promising modifications for African O&G.
For one, Asian and Center Jap nations are buying extra property: Dubai, Qatar, the U.A.E., Malaysia, and Chinese language NOCs acquired stakes in Egypt, Mozambique, Namibia, Kenya, and South Africa this 12 months. As world demand for power grows, significantly in Asia, I’m glad to see these nations seeking to Africa for long-term options.
International divestment additionally issues as a result of it’s creating alternatives for indigenous firms. Because of a latest Shell acquisition, Aradel Holdings turned Nigeria’s most precious oil firm ( In Angola, IOC Afentra has acquired Azule’s (a joint BP and Eni enterprise) property and plans to dramatically improve the nation’s total output.
“Having the large gamers promote to independents is the longer term,” oil dealer Trafigura mentioned in a press release.
It’s a promising sample: Majors dump mature property and use the capital to put money into contemporary fields and amenities. Unbiased international or indigenous firms use their acquired property to increase however are spared the expense of constructing amenities from the bottom up. These smaller firms are additionally strongly motivated to additional develop and scale back emissions from these present fields — an environmental and monetary win for everybody.
The Angolan authorities clearly agrees, encouraging regional gamers with tax incentives and decreased authorities revenue shares. Will probably be actually fascinating to observe this trade shakeup in Nigeria and Angola, which have been dominated for many years by majors.
It’s no secret that Africa wants O&G majors to remain: They drill over half of our exploration wells and maintain 1 / 4 of the continent’s fairness manufacturing. Nevertheless, I’m thrilled to see indigenous firms rising and harnessing these property to their fullest extent.
Conclusion
Simply what prompted this surge in African capex? An excessive amount of credit score goes to frequent sense coverage modifications in nations resembling Namibia, Senegal, Mauritania, Egypt, and Angola. We will additionally level out that the COVID-19 pandemic artificially slowed capex for a number of years, so an uptick was inevitable as soon as the world opened up once more.
Nevertheless, I imagine a number of it comes all the way down to financial actuality: International power wants are rising. Africa has huge, untapped assets. I urge all events to proceed constructing a thriving power trade that takes Africa – and the world – into the following century.
For additional insights, take a look at our 2025 State of African Power report right here (
Distributed by APO Group on behalf of African Power Chamber.
