Ongoing projects in Africa

As might be expected, most of the big energy projects currently under development concern oil and coal. About 885,000 b/d of new oil production is being brought on stream in Nigeria over the next three years, mostly in deepwater areas that are largely protected from the insecurity that plagues the onshore and shallow water fields of the Niger Delta. The schemes, which are all being developed by the oil majors, should boost the country’s production capacity above 3m b/d.

Even with such massive offshore investment, any deterioration in the security situation in the Niger Delta could see Angola overtake Nigeria as the continent’s biggest oil producer. It briefly held this title for a few months three years ago and a massive 1,025m b/d of new production capacity is scheduled to come on stream by the end of 2016. Angola too has the potential to produce 3m b/d.

Ghana, Uganda, Congo-Brazzaville and Tanzania will all benefit from upstream investment over the next few years but the only country to match the tens of billions of dollars being pumped into Nigeria and Angola is Mozambique. Vale and Rio Tinto are both developing coal projects with production capacity in excess of 10m tonnes a year and Tete Province should yield 50-100m tonnes a year within a decade if sufficient transport capacity is put in place.

Similarly, US firm Anadarko and Eni of Italy are leading consortia that are jointly developing a liquefied natural gas hub in the far north of the country. Each consortium will supply gas from their respective fields in the Rovuma Basin to the plant. Four liquefaction trains – or production lines – are planned in the first instance, with total production capacity of 20m tonnes a year and required investment estimated at $20bn. However, eventual expansion to 50m tonnes a year has been mooted.

Securing the finance from international banks for such schemes should be straightforward, given that the LNG will be marketed to Asian buyers under long-term contacts, probably of about 20 years.