Africa is a land known for its abundance of natural resources
“When we look at activities that we expect to happen over the next five years, it's more like a
“When we look at activities that we expect to happen over the next five years, it's more like a brand new day, like a sunrise in West Africa
.” Mark Adeosun, Westwood
Engineering, procurement and construction (EPC) opportunities offshore of West Africa have gradually been trending away from the traditional West African basins of Nigeria, Angola and Ghana and moving toward new horizons in offshore Mauritania, Senegal, Ivory Coast and Namibia. Production in the more traditional basins have begun to slow down due to a myriad of reasons.
The older powerhouses are more mature. With Nigeria in particular, security concerns and political uncertainties have played a part in slowing some of the production. The country has faced a steep production decline over the last 10 years, going from producing over 2 MMbbl/d in 2012 to around 1.3 MMbbl/d in 2022, according to Adeosun. This decline has opened the door for other nations looking to throw their hat in the oil and gas ring.
“Some of these countries are relatively new to the oil and gas industry and are quite keen for international E&P
The increase in activity offshore of West Africa evokes images of the 2012 to 2014 period when the region saw a boom in investments, Adeosun said
With a majority of the industry returning to pre-pandemic form, potential issues such as project delays begin to happen, as West Africa generally experiences those. Regardless of potential delays, projects are expected to move forward as long as oil prices continue to hold over $70/bbl, in ine with price forecasts. The number of subsea trees expected to be sanctioned could increase by a 150% increase between 2022 and 2026 compared to the preceding five-year period, Adeosun said.
“At the moment, what is driving EPC spending is the desire of E&P
Major IOCs have taken advantage of the EPC opportunities in Africa, including activity by top operators such as
In Namibia, Total and Shell are appraising newly discovered reserves. Despite Nigeria being a more mature basin, Chevron and Exxon
“I think overall we’ll see a very buoyant market in West Africa going forward due to some of the operator plans, as well as the potential for other developments from places that were considered to be undeveloped over that time period,” Adeosun said. “It’s more or less a dream for the supply chain in West Africa over the next three to five years, very similar to what we’re seeing in Brazil, where massive projects could be sanctioned over the next few years should oil prices hold above $70/bbl and operators proceed with their current development plans.”
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