As Africa looks to develop its gas for domestic and export markets, the U.S. is honing in on LNG as a critical investment avenue, alongside traditional oil exploration. In October 2023, energy research and consultancy group Wood Mackenzie stated that Africa’s $800-billion, 20-year upstream capital expenditure program would result in world-class LNG projects in Mozambique and floating LNG (FLNG) in five countries, presenting substantial gas-driven opportunities for U.S. investors, operators, project developers and service providers.
The upcoming Invest in African Energy (IAE) forum (https://apo-opa.co/4bITmY3) – taking place in Paris on May 14-15 – will showcase trade, partnership and investment opportunities available to U.S. companies across Africa’s energy supply chain. The event brings together projects from all four corners of the continent to the global investment stage, with a view to establishing regional African gas markets and capitalizing on rising U.S. interest in African energy.
While American companies are already at the helm of the continent’s booming LNG industry, there is room to grow their participation, particularly in FLNG, which offers increased flexibility, reduced time to market and suitability for smaller gas volumes. According to energy intelligence provider Westwood Global Energy, the global FLNG market is set to see $35 billion in new investment by 2027 – totaling 18.3 million tons per annum (mtpa) of additional capacity – with Africa dominating short-term investments. This increase in capacity will generate an associated engineering, procurement and construction (EPC) contract value of $13 billion. After 2027, an additional 36.5 mtpa of capacity is expected to come onstream, with an EPC value of $22 billion. The projects and companies driving these capacity increases will be on display at the IAE forum, along with new projects in the pipeline.
In Equatorial Guinea, U.S. operators and contractors are leading the country’s flagship Gas Mega Hub (GMH), which seeks to monetize all stranded gas fields in the Gulf of Guinea to facilitate an intra-African LNG trade. After achieving first gas from the project’s initial phase, Chevron’s Noble Energy E.G. signed a Heads of Agreement with Houston-based Marathon Oil and the government of Equatorial Guinea last March to develop phases two and three. The GMH could also pave the way for the construction of West Africa’s first LNG storage and regasification plant – the Akonikien LNG Terminal – proposed in 2019 and to be built by American manufacturer Corban Energy Group.
Mozambique is another strategic market for US gas investments, having passed $1 billion in LNG exports last November. American multinational ExxonMobil is currently leading development of the $23-billion Rovuma LNG project and anticipates a final investment decision in 2025, utilizing a retooled, phased construction approach. With a planned capacity of 18 million tons per year, the facility will deliver reliable, affordable energy to local customers, as well as export to global markets. In neighboring South Africa, ExxonMobil is studying the commercial and technical feasibility of an LNG regasification terminal to bring low-cost, reliable fuel to the country. Such projects can enable US participation in boosting Africa’s gas transport, storage and regasification capabilities, as well as erecting power stations and associated infrastructure.
With world-class LNG developments on the horizon – bp’s Greater Tortue Ahmeyim LNG in Senegal and Mauritania, Perenco’s Cap Lopez LNG Terminal in Gabon, Eni’s Congo LNG in the Republic of Congo, UTM Offshore’s first indigenous FLNG in Nigeria – the US needs to cement its market leadership in Africa’s on- and offshore gas industry. Dubbed the fuel of the future, LNG is set to play a substantial role in the African – and global – energy mix for the foreseeable future.
Organized by Energy Capital&Power, IAE 2024 (https://apo-opa.co/4bITmY3) is an exclusive forum designed to facilitate investment between African energy markets and global investors. Taking place May 14-15, 2024 in Paris, the event offers delegates two days of intensive engagement with industry experts, project developers, investors and policymakers. For more information, please visit www.Invest-Africa-Energy.com. To sponsor or participate as a delegate, please contact [email protected].
Distributed by APO Group on behalf of Energy Capital&Power.