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The decline in the global oil price has led to a reduced level of activity across the African continent and had an impact on countries that traditionally depend on oil & gas revenue, a new report put together by PwC has said.
It explained that despite the bleak landscape, the African continent still offers significant opportunities in the oil & gas sector.
PwC Africa Oil & Gas Advisory Leader, Chris Bredenhann said: “It is an opportune time for local governments that want to attract oil & gas investors to reform their regulatory, fiscal and licensing systems.”
Bredenhann says it is also important for the industry to look beyond the challenges caused by depressed prices and consider other forces that are shaping the industry. PwC’s ‘Africa oil & Gas Review, 2016’ suggests that with the ongoing focus on cost reduction in the industry, the demand for innovation in technology will grow.
Furthermore, this can be the ideal time for the industry to consider introducing training programmes to upskill levels and company standards in order to give local players a chance to enter the sector when activity picks up again.
PwC’s ‘Africa oil & gas review, 2016’ analyses what has happened in the last 12 months in the oil & gas industry within the major and emerging African markets.
As at the end of 2015, Africa has a proven natural gas base of 496.7 trillion cubic feet (Tcf), down marginally from 2014, with 90% of the continent’s natural gas production still coming from Nigeria, Libya, Algeria and Egypt.
The top challenges identified by organisations in the oil & gas industry have remained unchanged to those in previous years – uncertainty in regulatory frameworks, corruption/ethics, poor physical infrastructure and a lack of skill resources. This year, there was also a significant rise in the challenge of meeting taxation requirements, as well as government relations.
Bredenhann says it is also important for the industry to look beyond the challenges caused by depressed prices and consider other forces that are shaping the industry. PwC’s ‘Africa oil & Gas Review, 2016’ suggests that with the ongoing focus on cost reduction in the industry, the demand for innovation in technology will grow.
Furthermore, this can be the ideal time for the industry to consider introducing training programmes to upskill levels and company standards in order to give local players a chance to enter the sector when activity picks up again.
PwC’s ‘Africa oil & gas review, 2016’ analyses what has happened in the last 12 months in the oil & gas industry within the major and emerging African markets.
As at the end of 2015, Africa has a proven natural gas base of 496.7 trillion cubic feet (Tcf), down marginally from 2014, with 90% of the continent’s natural gas production still coming from Nigeria, Libya, Algeria and Egypt.
The top challenges identified by organisations in the oil & gas industry have remained unchanged to those in previous years – uncertainty in regulatory frameworks, corruption/ethics, poor physical infrastructure and a lack of skill resources. This year, there was also a significant rise in the challenge of meeting taxation requirements, as well as government relations.
According to the report, regulatory uncertainty has remained the top challenge facing oil & gas businesses in Africa for the third year in a row, “with 70% of organisations citing it as one of the five biggest issues they experience”.
*Contact citybusinessnews@yahoo.com
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