Oil firms plan large African investments

Given the tremendous opportunities that exist for oil and gas exploration and production on the African continent, the world’s “big five” energy companies – Total, Chevron Texaco, Exxon Mobil, Shell and BP – are all set to continue to play a major role in African economies for the long-term, bringing with them more sizeable investments into the upstream sector. This emerged at the 10th annual Africa Upstream Conference in Cape Town, where participants are all very positive about Africa’s growing role in oil and gas exploration and production (E&P), with Ken Evans, Exxon Mobil Exploration Co’s Vice President for Africa saying that the company planned to participate in ongoing and new development projects on the continent with a total value of some USD 30 billion. He said African countries were “well-positioned” to capture some of the 80 million barrels of oil per day (bpd) supply shortfall that was expected to exist in 2010. While global energy demand was set to grow to 160 million bpd in 2010, production from existing fields was set to fall to 80 million bpd, so new supplies would have to be found to meet the shortfall, requiring investments of over USD 1 trillion. Currently 16 countries in Africa produced about 10.5 million bpd, or 9% of total world output. Africa also had about 8% of the world’s total gas reserves.

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