The Nation : ‘Innovation key to Africa’s oil industry’s competitiveness’
Sustained lower price of oil has been accepted as normal in the global oil & gas industry, with companies putting measures in place to enable a more agile response to commodity price fluctuations in the future.
Instead of playing catch up with the rest of the world, Africa’s oil & gas industry should be learning to leapfrog and harness innovation and technology to stay ahead of the competition.
These were the highlights of PwC’s Africa Oil & Gas Review 2017, which analysed what has happened in the last 12 months in the oil & gas industry within the major and emerging markets.
The review, which was accessed by The Nation, said Africa’s oil & gas industry continues to face market challenges arising from the low oil price, competition for revenue growth and local talent together with new expectations from investors and regulators.
“Africa’s oil & gas industry is experiencing significant change and upheaval. There are fundamental shifts in companies’ strategies, business models and ways of working,” PwC Africa Oil & Gas Advisory Leader, Chris Bredenhann, said.
Bredenhann said for some, this means a diversification of portfolio, with many considering moves to an energy mix that includes some form of renewables. He said despite the challenges, there are a number of opportunities on the African continent.
For instance, as at the end of 2016, Africa was reported to have had proven natural gas reserves of 503.3 trillion cubic feet (TcF), up one per cent in total gas reserves on the continent.
Bredenhann added that about 90 per cent of African gas production continues to come from Algeria, Nigeria, Egypt and Libya though the overall quantity produced in 2016 reduced by 1.1 per cent down to 208.3bcm.