African Energy Chamber releases African Energy Outlook 2021
African Energy Chamber issues rallying call to all industry stakeholders to work together on a reform agenda to keep African natural resources competitive and create jobs; short-term outlook for African oil & gas remains marked by Covid-19 and uncertain market conditions expected to result in a $30bn cut in Capex spending (2020-2021); South Western Africa expected to emerge as the next energy frontier on the continent on the back of high-impact wells coming up in 2021 and 2022; the continent’s production of oil & gas is expected to increase in 2021 as OPEC’s sanctions ease and on the back of increase oil output from Libya and increased gas production from Algeria and Egypt.
The African Energy Chamber is excited to announce the release of the African Energy Outlook 2021! The report explores the forces shaping up continent’s energy market after the historic shocks of 2020, and analyses the upcoming recovery on the back of the global energy transition and persisting market uncertainties. After a year of historic crisis, the Outlook offers guidance and solutions for African energy stakeholders to navigate troubled waters and support a strong recovery in 2021 and beyond.
The pandemic notably came at a particularly difficult moment in Africa, exacerbating already challenging market conditions on the back of a competitive American shale industry, the delaying of major projects due to regulatory uncertainty, and increasing global attention to decarbonisation. The African Energy Chamber notably expects a CAPEX spending cut of $30bn over the 2020-2021 period, and has identified a further $80bn of investment whose sanctioning will depend on improving market conditions, along with bold policy and fiscal reforms from African regulators.
The report provides detailed information in areas of critical importance, and includes sections examining jobs and employment, cash-flow and profit forecasts, the expenditure and investment outlook, carbon emissions, oil and gas market projections, and regional production outlook. Pressing issues including notably the OPEC’s production cuts, ongoing regulatory reforms, the impact of the COVID-19 by region and country, and offshore drilling demand across multiple continental shelves are analysed in detail.
‘’It goes without saying that Africa has witnessed its fair share of difficult times this year. Even though oil and gas activities have taken a hit, optimism surrounding African projects, fiscal regime and investments still exist but requires all of us as stakeholders to do more. There has always been opportunity in drastic and unprecedented times, which gives us a lot to look forward to,” declared Nj Ayuk, Executive Chairman of the African Energy Chamber.
The Outlook is the result of strong regional and international cooperation between actors of government, and public and private sector stakeholders across sub-Saharan Africa. It gathers the latest available data on sub-Saharan Africa’s hydrocarbons markets, and benefits from the insights of key local, regional and international companies, experts and economists, making it the most comprehensive resource to date on the future of African energy markets.
‘’The report highlights the expected outcome of post COVID-19 mitigation strategies to the African energy sector in 2021 and beyond. It also assesses Africa’s competitiveness compared with other frontiers, and highlights the countless opportunities that continue to emerge and exist across our entire energy value chain. We look forward to this report serving as a basis for sound decisions towards a thriving energy industry in Africa,’’ said Senior-Vice President, Verner Ayukegba of the African Energy Chamber.