M a r k e t N e w s

Competition for oil and gas production in Africa steps up

Posted on : Tuesday, 19th August 2014

 Many countries in Africa remain a beacon for investment in theoil and gas industry, with around 8% of the world’s untapped proven oil reserves on the continent, 

The continent’s share of global production dropped from 12% in 2013 to 10% in 2014, but competition remained “extremely tight”.
In addition to multinationals, a rising number of national oilcompanies were moving in to also compete.
“There’s more competition when you look at the bidding rounds, with national oil companies playing a larger role. The bidding rounds are highly competitive,” noted Bredenhann.
There are 30 national oil companies in Africa, with Sonatrach, from Algeria, the only African national oil company listed among the top ten largest oil companies by reserves globally.
Expanding on PwC’s Africa Oil and Gas Review for 2014, Bredenhann said a new deal was made every four days in Africa. This equated to a $1-billion deal every 17 days.
Oil and gas industry players who were surveyed for the report were clearly aware of sharper competition. A total of 67% expected a change in the competitive landscape in 2014 compared with 42% in 2012.
An interesting trend has been the fall in the number of expatriates employed in the African oil and gas sector over the past year. This had dropped from 25% of the total workforce in 2012 to 10% in 2014.
The report said the figure was representative of a comprehensive cross-section of companies and countries, from those in more established oil and gas areas such as Nigeria ,Ghana, Kenya  Tanzania and Namibia.
Local content policy (LCP) was driving this change, stated Bredenhann.
Several countries, including Nigeria, Ghana, Gabon and Egypt, were pursuing policies that enable locals to invest, provide services, supply goods and create jobs. Bredenhann told a packed auditorium for the Sanea gathering that LCP was also being stepped up in Angola.
On average, 12.4% of expatriates in the oil and gas industry in Africa were in senior and middle management positions in 2014, with 10.4% in specialist technical roles such as drilling supervisors. 
Countries like Tanzania, Kenya and Ghana have a much higher proportion of expats than others, such as the Democratic Republic of Congo, Gabon,Mauritius and Morocco.
Bredenhann said more than 70% of the industry players surveyed listed skills and people training and development among their top five strategic priorities.

Source : www.engineeringnews.co.za
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