The 2023 edition of AOW: Investing in African Energy was marked by several key announcements, statements and deals that are set to shape projects and market trends over the coming year.
Africa will set its own energy-transition timelines as it heads to COP28
AOW and the Green Energy Africa Summit (GEAS) concluded on a key agreement that African nations will set their own timelines for the transition to a low-carbon future, recognising a need to continue working together to maximise their development synergies.
“Africa must keep the lights on during its transition period,” said South African Deputy President Paul Mashatile during a passionate opening ceremony on Tuesday. He echoed calls from governments and stakeholders to set pragmatic, realistic targets for Africa’s transition, while prioritising the continent’s development needs.
AOW provided a platform for enriched cooperation between African nations, especially when it comes to cross-border energy trade and regional investments.
Exploration is heating up
AOW confirmed that Africa’s rigs count is at its highest in years, which is supporting market recovery across the continent. The year so far has seen an ongoing succession of historical discoveries in the Orange Basin, as well as successful wells in places like Nigeria and Mozambique. At AOW 2023, details were shared on ongoing drilling programmes in Zimbabwe and Mauritania, two exploration frontiers that could deliver tremendous results over coming weeks.
A particular focus fell on Zimbabwe’s ongoing exploration programme, and how it could transform Southern Africa’s energy security through natural gas. Azule Energy also confirmed it was planning Angola’s very first gas exploration well in 2024, on Block 1/14.
Loyal to its key mission of promoting E&P deals across Africa, AOW 2023 also provided a platform to promote attractive open blocks and licensing rounds in Africa. This year’s edition was marked by critical discussions and negotiations around opportunities in Angola, Namibia, Gabon, Congo, The Gambia, Sierra Leone, and Tanzania.
Natural gas is both a transition and destination fuel
Natural gas was the topic of the week, featuring prominently across all sessions, panels, and discussions. AOW provided clarity on ongoing and upcoming projects including the GTA LNG hub in Mauritania/Senegal, the Congo LNG project in Congo-Brazzaville, the Coral Sul and Coral North floating LNG (FLNG) units in Mozambique, Tanzania LNG, and Nigeria LNG’s potential expansion.
Regional gas trade was also discussed in detail, paving the way for additional stakeholder cooperation to boost gas utilisation in West, Central, and Southern Africa. However, a key take-away was the need to provide better enabling environments to explore and produce more gas via clear fiscal regimes and market-based pricing.
‘Nigeria will curb its emissions, not its ambitions’
Africa’s biggest oil producer made a big comeback to the market this year, following rapid reforms under new president Bola Tinubu. Special advisor to President Tinubu on Energy, Olu Verheijen, sent a strong message to investors and stakeholders that Nigeria was open for business and would not compromise on its development ambitions.
Nigerian representation was strong at AOW this year, showcasing several deals involving gas monetisation, industrial park development, refinery expansion, and farm-in opportunities across onshore and shallow-water areas.
Access to capital will require more creativity
AOW’s Finance and M&A Forum was one of the best attended in the programme, as it welcomed some of the continent’s largest development-finance institutions (DFIs), commercial banks and lenders, private-equity investors, and finance executives from growing E&P companies.
A key take-away from the forum was the need to work on unlocking domestic capital and dual-currency financing mechanisms. All participants agreed on the need to develop African natural resources quickly, efficiently, and sustainably, but raised concerns over the lack of investments and the need for the continent to become more globally competitive.
The Forum identified equity financing and domestic financing as the two key areas to focus on when it comes to stakeholder engagement, cooperation and innovation.
Decarbonisation is a gradual process
AOW addressed the challenges and opportunities of decarbonising Africa’s oil-and-gas sector as a matter of competitiveness. Several deals were negotiated to invest in lower-carbon technologies and carbon-capture, utilisation and storage projects.
Equally importantly, stakeholders have been given clear directions and insights into the ways Africa can decarbonise its value chain in the short, medium, and long terms.
Quick wins were notably suggested around utilising associated gas and optimising value chains in the upstream sector to cut emissions immediately, while integrating low-carbon technologies within future field-development plans.
AOW: Investing in African Energy returns to Cape Town on 7-11 October 2024.