S&P Global Commodity Insights, a consulting and market research firm, recently published its newest report, Africa Energy Review, and Outlook 2022–23, which highlights key trends influencing the continent’s energy sector and offers recommendations for stakeholders in the sector and policymakers to maximize market growth.
As the voice of the African energy industry, the African Energy Chamber (AEC) applauds S&P Global Commodity Insights for its work in updating international investors on opportunities throughout the entire African energy value chain.
The report offers a clear visibility of recent activities as well as an outlook on upstream, downstream, and power and renewables landscapes, even though Africa is at a crossroads in terms of maximizing investments, development, and the exploitation of its entire energy base to address energy poverty.
According to the study, upstream activities in Africa had a banner year in 2022 as a result of governments putting more effort into maximizing oil and gas exploitation and monetization to increase revenue streams and satisfy rising energy demand locally and globally.
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Despite, the COVID-19 pandemic and energy transition-related policies disrupting industry growth in previous years, 2022 was marked by new licensing round launches, revitalization of fiscal terms to attract new upstream investments, giant discoveries in Namibia and Angola, and countries such as Angola, Nigeria, Equatorial Guinea, Congo and Mozambique fast-tracking gas and liquefied natural gas projects deployment.
With global majors and international independents intensifying activities in frontier markets and offshore basins, and seeking to accelerate resource development and monetization to take advantage of the high energy prices, the study forecasts investments across the region’s upstream sector to increase, with financial investment decisions for 30 new projects anticipated in 2023 and for another 30 projects in 2024.
Meanwhile, in the downstream sector, demand for refined products continued to grow with 2022 levels matching pre-pandemic levels and Africa ranking as the world’s third-largest consumer of refined products, according to the study. With some regional refineries closing, S&P Global forecasts Africa to record diesel shortages, a situation set to prompt increased investments in downstream infrastructure as countries also strive to avoid external shocks on their markets. The continent is also predicted to become the world’s fastest-growing downstream market in 2023.
Story adapted from The Guardian
