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  •   Despite having abundant oil and gas resources Africa s production has declined posing a challenge for the continent as it moves to initiate an economic recovery from COVID 19 and address energy poverty With exploration curtailed due to reduced capital for fossil fuel projects and transitioning away from hydrocarbons the continent needs to act now if it is to reap the benefits of its oil and gas resources What will this low yield of production in Nigeria Libya Angola the Republic of the Congo Equatorial Guinea and the African countries mean for the continent as a whole These countries are heavily dependent on the export of oil and natural gas so poor production performance will inevitably have an impact on their economies both in terms of access to cheap energy and treasury revenues This in turn could have a destabilizing effect on these countries However temporary underperformance can be managed but persistent underperformance would be far more detrimental as it would hold back development and the ability of these countries to invest in the energy transition In modern society technology drives progress but technology requires power whether it s a smartphone tablet laptop or other device designed to make life easier Nations that do not invest in energy will be left behind and will lack the economic growth to finance development This is a matter of health and social care progress in living standards and access to opportunities In the short term reduced supply means higher oil prices which leads to higher inflation and higher inflation hits the poorest hardest These countries have the means and capacity to change this so the underperformance only has to be temporary What do you think are the main reasons influencing the decline in production in Africa What can be done to turn this around Leaving aside the recent impact of COVID global issues such as the energy transition combined with significant country specific issues are causing a decline in production At the core of the challenge is the lack of investment in exploration and the question of what countries need to do to attract this investment The pool of both equity and debt capital for oil and gas projects is in decline largely but not exclusively due to pressure to deliver on the energy transition With a dwindling supply of global capital for these types of projects funders can be selective about where the capital is invested and therefore the competition is stiff and the threshold to secure it is high African countries must provide a stable and competitive framework for investment This applies not only to countries with existing production where infrastructure driven exploration ILEX can provide additional lower risk resources but also to countries with frontier exploration potential It is these new frontiers of higher risk but greater resources with the opportunity to have large scale economic impact that have the greatest challenges in attracting capital A stable and competitive framework for investment requires political certainty transparent decision making processes that allow projects to progress quickly pace is intrinsically related to value competitive and stable fiscal terms and a stable legal framework Governments are often too quick to tighten fiscal terms immediately after early discoveries presenting significant obstacles to further exploration Fiscal terms and the opportunity to participate in new licensing rounds must remain competitive to attract venture capital Norway has been producing oil since the 1970s It recently announced the award of 53 new licences of which Equinor acquired interests in 26 blocks and announced that it plans to drill 25 exploration wells during 2022 By comparison South Africa where Impact has a large presence has only seen two exploration wells during the last 10 years Norway operates a model that allows and encourages exploration which has placed Norway among the top 15 oil producers in the world and has allowed it to create a sovereign wealth fund worth more than a trillion dollars Much of Africa s production is in shallower waters and is maturing rapidly The decrease in production requires investment in exploration Therefore it is important to incentivize frontier exploration alongside ILEX opportunities and maintain an adequate fiscal framework A one size fits all fiscal framework will limit exploration to smaller near field exploration opportunities The demand for energy is only growing while there is a rapid and simultaneous reduction in investment in exploration and production This reality and its consequences are reflected in current global oil and gas prices and the apparent economic and geopolitical turmoil it is causing The demand trend is unlikely to reverse anytime soon so Africa should invest to reverse its growing production shortfall What would you recommend as an industry approach to low carbon gas monetization and financing in Africa Natural gas is a relatively low carbon energy source compared to oil or coal making it an obvious transition fuel that could meet Africa s energy needs from its own resources However this must be done quickly as the transition period is not indefinite Providing energy to African countries through the use of domestic gas has a number of advantages importing LNG and or oil has a much larger carbon footprint than using domestic gas enables a just transition away from coal in countries like South Africa where 80 of its electricity is generated from coal and provides a cleaner alternative to firewood and charcoal which are used by more than 60 of families in sub Saharan Africa to prepare meals and meet other energy needs due to the lack of affordable alternatives This is detrimental to health and contributes significantly to forest degradation Natural gas should be part of a broader energy mix that encompasses other low carbon energy sources The role of the oil and gas industry in Africa can and should be broader than the exploration and development of oil and gas resources We are seeing more and more agreements between governments and IOCs to collaborate on investment in a multi energy strategy that supports the development of renewable projects alongside major oil and gas projects For example as part of the recent Final Investment Decision for the Uganda Tanzania Crude Oil Pipeline the Kingfisher and Tilenga oil projects in the Lake Albert region of Uganda and TotalEnergies signed an agreement to explore opportunities to develop renewable energy projects Initiatives like this bring expertise and funding to the continent What should new independents consider when entering a changing African energy sector Historically Africa has provided great opportunities for freelancers In fact it has benefited from its agile and aggressive strategies and its ability to raise capital for higher risk early entry projects Companies like Kosmos Tullow Ophir Cove and Far for example have been at the forefront of major game opening discoveries in Senegal Mauritania Ghana Mozambique and Tanzania leading the way for big frontier opportunities However the role of independents in the sector is changing New Africa focused independents are chasing production ILEX mature and marginal fields but billion barrel game opening exploration opportunities remain in high risk frontier areas Although there is no longer room for independent explorers to build greenfield exploration portfolios there is neither the time nor the capital to support such strategies independents can still play an important role in accelerating growth in countries with world opening discoveries game by expelling the game to the most risky limits What pending deals do you think should be completed and announced at the African Energy Week in cape town News on the development of the Block 11b 12b gas discoveries and how this could fit into South African plans for its strategic energy mix The completion of the South African Upstream Petroleum Development Bill Impact is a pure exploration company with a strategic focus on large scale mid to deep water tracts of sufficient size to be of interest to major companies Impact currently invests in African oil and gas blocks including Namibia South Africa and the AGC Profond block in Guinea Bissau and Senegal
    Powering African Countries with domestic gas is advantageous than importing Liquefied Natural Gas (LNG) says Impact Oil & Gas Chief Executive Officer (CEO)
      Despite having abundant oil and gas resources Africa s production has declined posing a challenge for the continent as it moves to initiate an economic recovery from COVID 19 and address energy poverty With exploration curtailed due to reduced capital for fossil fuel projects and transitioning away from hydrocarbons the continent needs to act now if it is to reap the benefits of its oil and gas resources What will this low yield of production in Nigeria Libya Angola the Republic of the Congo Equatorial Guinea and the African countries mean for the continent as a whole These countries are heavily dependent on the export of oil and natural gas so poor production performance will inevitably have an impact on their economies both in terms of access to cheap energy and treasury revenues This in turn could have a destabilizing effect on these countries However temporary underperformance can be managed but persistent underperformance would be far more detrimental as it would hold back development and the ability of these countries to invest in the energy transition In modern society technology drives progress but technology requires power whether it s a smartphone tablet laptop or other device designed to make life easier Nations that do not invest in energy will be left behind and will lack the economic growth to finance development This is a matter of health and social care progress in living standards and access to opportunities In the short term reduced supply means higher oil prices which leads to higher inflation and higher inflation hits the poorest hardest These countries have the means and capacity to change this so the underperformance only has to be temporary What do you think are the main reasons influencing the decline in production in Africa What can be done to turn this around Leaving aside the recent impact of COVID global issues such as the energy transition combined with significant country specific issues are causing a decline in production At the core of the challenge is the lack of investment in exploration and the question of what countries need to do to attract this investment The pool of both equity and debt capital for oil and gas projects is in decline largely but not exclusively due to pressure to deliver on the energy transition With a dwindling supply of global capital for these types of projects funders can be selective about where the capital is invested and therefore the competition is stiff and the threshold to secure it is high African countries must provide a stable and competitive framework for investment This applies not only to countries with existing production where infrastructure driven exploration ILEX can provide additional lower risk resources but also to countries with frontier exploration potential It is these new frontiers of higher risk but greater resources with the opportunity to have large scale economic impact that have the greatest challenges in attracting capital A stable and competitive framework for investment requires political certainty transparent decision making processes that allow projects to progress quickly pace is intrinsically related to value competitive and stable fiscal terms and a stable legal framework Governments are often too quick to tighten fiscal terms immediately after early discoveries presenting significant obstacles to further exploration Fiscal terms and the opportunity to participate in new licensing rounds must remain competitive to attract venture capital Norway has been producing oil since the 1970s It recently announced the award of 53 new licences of which Equinor acquired interests in 26 blocks and announced that it plans to drill 25 exploration wells during 2022 By comparison South Africa where Impact has a large presence has only seen two exploration wells during the last 10 years Norway operates a model that allows and encourages exploration which has placed Norway among the top 15 oil producers in the world and has allowed it to create a sovereign wealth fund worth more than a trillion dollars Much of Africa s production is in shallower waters and is maturing rapidly The decrease in production requires investment in exploration Therefore it is important to incentivize frontier exploration alongside ILEX opportunities and maintain an adequate fiscal framework A one size fits all fiscal framework will limit exploration to smaller near field exploration opportunities The demand for energy is only growing while there is a rapid and simultaneous reduction in investment in exploration and production This reality and its consequences are reflected in current global oil and gas prices and the apparent economic and geopolitical turmoil it is causing The demand trend is unlikely to reverse anytime soon so Africa should invest to reverse its growing production shortfall What would you recommend as an industry approach to low carbon gas monetization and financing in Africa Natural gas is a relatively low carbon energy source compared to oil or coal making it an obvious transition fuel that could meet Africa s energy needs from its own resources However this must be done quickly as the transition period is not indefinite Providing energy to African countries through the use of domestic gas has a number of advantages importing LNG and or oil has a much larger carbon footprint than using domestic gas enables a just transition away from coal in countries like South Africa where 80 of its electricity is generated from coal and provides a cleaner alternative to firewood and charcoal which are used by more than 60 of families in sub Saharan Africa to prepare meals and meet other energy needs due to the lack of affordable alternatives This is detrimental to health and contributes significantly to forest degradation Natural gas should be part of a broader energy mix that encompasses other low carbon energy sources The role of the oil and gas industry in Africa can and should be broader than the exploration and development of oil and gas resources We are seeing more and more agreements between governments and IOCs to collaborate on investment in a multi energy strategy that supports the development of renewable projects alongside major oil and gas projects For example as part of the recent Final Investment Decision for the Uganda Tanzania Crude Oil Pipeline the Kingfisher and Tilenga oil projects in the Lake Albert region of Uganda and TotalEnergies signed an agreement to explore opportunities to develop renewable energy projects Initiatives like this bring expertise and funding to the continent What should new independents consider when entering a changing African energy sector Historically Africa has provided great opportunities for freelancers In fact it has benefited from its agile and aggressive strategies and its ability to raise capital for higher risk early entry projects Companies like Kosmos Tullow Ophir Cove and Far for example have been at the forefront of major game opening discoveries in Senegal Mauritania Ghana Mozambique and Tanzania leading the way for big frontier opportunities However the role of independents in the sector is changing New Africa focused independents are chasing production ILEX mature and marginal fields but billion barrel game opening exploration opportunities remain in high risk frontier areas Although there is no longer room for independent explorers to build greenfield exploration portfolios there is neither the time nor the capital to support such strategies independents can still play an important role in accelerating growth in countries with world opening discoveries game by expelling the game to the most risky limits What pending deals do you think should be completed and announced at the African Energy Week in cape town News on the development of the Block 11b 12b gas discoveries and how this could fit into South African plans for its strategic energy mix The completion of the South African Upstream Petroleum Development Bill Impact is a pure exploration company with a strategic focus on large scale mid to deep water tracts of sufficient size to be of interest to major companies Impact currently invests in African oil and gas blocks including Namibia South Africa and the AGC Profond block in Guinea Bissau and Senegal
    Powering African Countries with domestic gas is advantageous than importing Liquefied Natural Gas (LNG) says Impact Oil & Gas Chief Executive Officer (CEO)
    Africa10 months ago

    Powering African Countries with domestic gas is advantageous than importing Liquefied Natural Gas (LNG) says Impact Oil & Gas Chief Executive Officer (CEO)

    Despite having abundant oil and gas resources, Africa's production has declined, posing a challenge for the continent as it moves to initiate an economic recovery from COVID-19 and address energy poverty. With exploration curtailed due to reduced capital for fossil fuel projects and transitioning away from hydrocarbons, the continent needs to act now if it is to reap the benefits of its oil and gas resources.

    What will this low yield of production in Nigeria, Libya, Angola, the Republic of the Congo, Equatorial Guinea and the African countries mean for the continent as a whole?

    These countries are heavily dependent on the export of oil and natural gas, so poor production performance will inevitably have an impact on their economies, both in terms of access to cheap energy and treasury revenues. This, in turn, could have a destabilizing effect on these countries. However, temporary underperformance can be managed, but persistent underperformance would be far more detrimental as it would hold back development and the ability of these countries to invest in the energy transition.

    In modern society, technology drives progress, but technology requires power, whether it's a smartphone, tablet, laptop, or other device designed to make life easier. Nations that do not invest in energy will be left behind and will lack the economic growth to finance development. This is a matter of health and social care, progress in living standards and access to opportunities.

    In the short term, reduced supply means higher oil prices, which leads to higher inflation, and higher inflation hits the poorest hardest. These countries have the means and capacity to change this, so the underperformance only has to be temporary.

    What do you think are the main reasons influencing the decline in production in Africa? What can be done to turn this around?

    Leaving aside the recent impact of COVID, global issues such as the energy transition, combined with significant country-specific issues, are causing a decline in production. At the core of the challenge is the lack of investment in exploration and the question of what countries need to do to attract this investment.

    The pool of both equity and debt capital for oil and gas projects is in decline, largely (but not exclusively) due to pressure to deliver on the energy transition. With a dwindling supply of global capital for these types of projects, funders can be selective about where the capital is invested and therefore the competition is stiff and the threshold to secure it is high.

    African countries must provide a stable and competitive framework for investment. This applies not only to countries with existing production, where infrastructure-driven exploration (ILEX) can provide additional, lower-risk resources, but also to countries with frontier exploration potential. It is these new frontiers of higher risk, but greater resources, with the opportunity to have large-scale economic impact, that have the greatest challenges in attracting capital.

    A stable and competitive framework for investment requires political certainty; transparent decision-making processes that allow projects to progress quickly (pace is intrinsically related to value); competitive and stable fiscal terms; and a stable legal framework. Governments are often too quick to tighten fiscal terms immediately after early discoveries, presenting significant obstacles to further exploration. Fiscal terms and the opportunity to participate in new licensing rounds must remain competitive to attract venture capital.

    Norway has been producing oil since the 1970s. It recently announced the award of 53 new licences, of which Equinor acquired interests in 26 blocks, and announced that it plans to drill 25 exploration wells during 2022. By comparison, South Africa, where Impact has a large presence , has only seen two exploration wells during the last 10 years. Norway operates a model that allows and encourages exploration, which has placed Norway among the top 15 oil producers in the world and has allowed it to create a sovereign wealth fund worth more than a trillion dollars.

    Much of Africa's production is in shallower waters and is maturing rapidly. The decrease in production requires investment in exploration. Therefore, it is important to incentivize frontier exploration alongside ILEX opportunities and maintain an adequate fiscal framework. A one-size-fits-all fiscal framework will limit exploration to smaller near-field exploration opportunities.

    The demand for energy is only growing, while there is a rapid and simultaneous reduction in investment in exploration and production. This reality, and its consequences, are reflected in current global oil and gas prices and the apparent economic and geopolitical turmoil it is causing. The demand trend is unlikely to reverse anytime soon, so Africa should invest to reverse its growing production shortfall.

    What would you recommend as an industry approach to low-carbon gas monetization and financing in Africa?

    Natural gas is a relatively low-carbon energy source compared to oil or coal, making it an obvious transition fuel that could meet Africa's energy needs from its own resources. However, this must be done quickly as the transition period is not indefinite.

    Providing energy to African countries through the use of domestic gas has a number of advantages: importing LNG and/or oil has a much larger carbon footprint than using domestic gas; enables a just transition away from coal in countries like South Africa, where 80% of its electricity is generated from coal; and provides a cleaner alternative to firewood and charcoal, which are used by more than 60% of families in sub-Saharan Africa to prepare meals and meet other energy needs, due to the lack of affordable alternatives. This is detrimental to health and contributes significantly to forest degradation.

    Natural gas should be part of a broader energy mix that encompasses other low-carbon energy sources. The role of the oil and gas industry in Africa can and should be broader than the exploration and development of oil and gas resources. We are seeing more and more agreements between governments and IOCs to collaborate on investment in a multi-energy strategy that supports the development of renewable projects alongside major oil and gas projects. For example, as part of the recent Final Investment Decision for the Uganda-Tanzania Crude Oil Pipeline, the Kingfisher and Tilenga oil projects in the Lake Albert region of Uganda and TotalEnergies signed an agreement to explore opportunities to develop renewable energy projects. Initiatives like this bring expertise and funding to the continent.

    What should new independents consider when entering a changing African energy sector?

    Historically, Africa has provided great opportunities for freelancers. In fact, it has benefited from its agile and aggressive strategies and its ability to raise capital for higher-risk, early-entry projects. Companies like Kosmos, Tullow, Ophir, Cove and Far (for example) have been at the forefront of major game-opening discoveries in Senegal, Mauritania, Ghana, Mozambique and Tanzania, leading the way for big frontier opportunities.

    However, the role of independents in the sector is changing. New Africa-focused independents are chasing production (ILEX, mature and marginal fields), but billion-barrel game-opening exploration opportunities remain in high-risk frontier areas.

    Although there is no longer room for independent explorers to build greenfield exploration portfolios (there is neither the time nor the capital to support such strategies), independents can still play an important role in accelerating growth in countries with world-opening discoveries. game, by expelling the game - to the most risky limits.

    What pending deals do you think should be completed and announced at the African Energy Week?

    in cape town

    News on the development of the Block 11b/12b gas discoveries and how this could fit into South African plans for its strategic energy mix. The completion of the South African Upstream Petroleum Development Bill.

    Impact is a pure exploration company with a strategic focus on large-scale mid to deep water tracts of sufficient size to be of interest to major companies. Impact currently invests in African oil and gas blocks, including Namibia, South Africa, and the AGC Profond block in Guinea Bissau and Senegal.

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