Floating LNG is expected to be a game-changer, boosting the efficiency of gas production by adding the processing to the place of extraction
Nigeria has reclaimed its position as Africa’s leading oil upstream investment destination, overtaking Angola despite the latter’s continued investment in major deepwater developments.
Data sourced from Wood Mackenzie, Nigeria topped the continent’s upstream capital expenditure (capex) rankings in 2024, driven by a series of incremental deepwater projects and sustained activity in its rich offshore basins.
The country outpaced Angola, which had held the position in recent years, by capitalising on major oil projects such as the Agogo-Ndungu development by Azule Energy, and the ongoing work on TotalEnergies’ infill projects – Block 32 and Block 17 –
Olu Verheijen, the special adviser on energy to president Bola Tinubu on Monday said Nigeria’s performance is directly tied to the approval of five landmark presidential directives and fiscal incentives introduced during the year.
“These transformative measures are not only reshaping Nigeria’s energy landscape but also setting the stage for unprecedented levels of investment in 2025 and beyond, reaffirming Nigeria’s role as a powerhouse in Africa’s energy sector,” Verheijen said on X, formally known as Twitter.
Nigeria’s key projects lead charge
According to Wood Mackenzie, among the key investments is the Iseni project, with an estimated capex of $122 million and reserves of 84 million barrels of oil equivalent (mmboe).
Furthermore, the Ubeta project, witth a capex of $566 million and reserves of 182 mmboe, the project is expected to increase the country’s oil production capacity.
Additionally, Nigeria’s flagship offshore development, the Bonga North Tranche 1, will see $4.6 billion invested and 350 mmboe in reserves.
Another noteworthy project is HI (OML 144), a fixed platform development by Energes, which has committed $2.6 billion in investment for 327 mmboe of reserves. Though the FID date remains unspecified, the project is set to be one of the key drivers of Nigeria’s long-term oil production strategy.
While Nigeria’s resurgence is notable, Angola also maintained substantial investment levels. The country’s oil majors, notably TotalEnergies and ExxonMobil, continued to focus on offshore projects in Block 31 and Block 20/11.
These included drilling campaigns in the Kaminho I field, which remain vital to Angola’s upstream spending despite lower-than-expected returns from some of its marginal projects.
“The competition between Nigeria and Angola remains intense, but Nigeria’s ability to attract investment in its deepwater fields has proven decisive,” McDonald added.
Elsewhere in West Africa, other nations such as Ghana, Senegal, and Côte d’Ivoire also saw increasing upstream investment, though not at the scale of Nigeria.
“Focus on Ghana’s Presidential election slowed down upstream activities in 2024,” Wood Mackenzie said.
Read also: Global upstream oil investment hits highest since 2014
Angola’s Exit and the Shift in Regional Dynamics
Analysts at Wood Mackenzie noted that Nigeria’s regained lead comes as a result of a series of strategic shifts within the continent.
One of the most notable developments was Angola’s decision to exit OPEC in early 2024.
“This was a constraint considering current production levels (~1.1 million b/d) and future ambitions,” Wood Mackenzie said.
To change the narrative, Angola’ National Assembly authorised its President to introduce new rules for incremental projects in mature blocks and undeveloped projects in producing licences offshore.
“The objective is to maximise hydrocarbon recovery in producing areas and enable additional upstream investments,” Wood Mackenzie said.
Wood Mackenzie also acknowledge the Niger-Benin pipeline, which became operational in 2024 and marked Niger’s emergence as the newest oil exporter in Africa.
However, exports via the pipeline were temporarily halted due to border disputes with Benin and internal rebel attacks. After successful diplomatic talks, the pipeline resumed operations within four months, reinforcing Niger’s potential as a key player in the region’s energy market.
“Border disputes with Benin and internal rebel attacks soon halted exports via the pipeline. Niger explored alternate export options through Chad and other countries. However, successful diplomatic talks with Benin restored exports within four months,” Wood Mackenzie said.
On the institutional front, the establishment of the African Energy Bank in June 2024 is seen as a pivotal moment for the continent.
“It is expected to provide debt and equity financing options to oil and gas as well as renewable energy projects across Africa,” Wood Mackenzie said.
Changes Across the Continent
In other parts of Africa, BusinessDay’s findings showed political shifts and regulatory reforms have influenced the energy sector.
In Mozambique, the ruling party Frelimo won by a landslide in a contentious election in October, triggering months of violent protests. In Senegal, Bassirou Diomaye Faye made history as the youngest-ever president, promising a revamp of the country’s oil contracts, which could have significant implications for the sector.
Namibia, on the other hand, made history with the election of Netumbo Nandi-Ndaitwah as its first female president. As a member of the Swapo party, which has governed the country since 1990, Nandi-Ndaitwah’s leadership could signal further advancements in Namibia’s oil and gas sector.
In South Africa, the government took bold steps to restructure the state’s role in the energy industry. The merger of PetroSA, iGas, and the Strategic Fuel Fund (SFF) led to the creation of the South African National Petroleum Company (SANPC), while the approval of the Upstream Petroleum Resources Development Bill (UPRDB) in October increased the state’s participation in exploration and development projects to 20 percent.
“The Upstream Bill includes several changes, including an increase to state participation to 20 percent (from 10 percent). The state will be carried through both exploration and development phases (development costs not previously carried),” Wood Mackenzie said.