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Home >> Business
UPDATED: 08:20, September 26, 2005
World covets Africa's black gold
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The World is focusing its attention on Africa as thousands of top oil executives and high-level government representatives gathered in Johannesburg to address pressing industry issues at the 18th World Petroleum Congress (18th WPC).

The international gathering will put Africa in the spotlight and at the center of decision-making about global petroleum challenges.

As the world's poorest continent, Africa is receiving more and more attention form oil-hungry countries and petroleum producers, amid rising oil prices, instability in the Arab world and production slowdowns in the hurricane-hit Gulf of Mexico.

For the United States, the biggest oil consumer in the world, oil-rich Africa has been a "new, strategic place." Oil production in west Africa's Gulf of Guinea states (Nigeria, Congo, Gabon, Cameroon and Equatorial Guinea) now amounts to more than 4.5 million barrels per day, exceeding that of Saudi Arabia. Currently,the United States is importing almost 15 percent of its oil from that region, and it is predicted that that figure will continue torise, reaching 25 percent by 2025.

Walter Kansteiner, US assistant secretary of state for African affairs, has conceded, "African oil has become an appealing national strategy for us."

For its part, in 2000, the European Union was already importing22 percent of its oil from the Gulf of Guinea countries.

Africa's main oil producing countries lie in this strategicallyimportant zone, including Nigeria, Angola, Gabon and Equatorial Guinea, with reserves estimated at up to 60 billion barrels of crude oil.

However, countries such as Sudan, Angola, Chad and Libya have also reemerged from years of political isolation and are offering access to extensive reserves.

Besides western countries, all globally prominent oil companies,such as Shell, ExxonMobil, Chevron Texaco or Total, also have their presence in Africa. Billions of dollars from these companieshave been injected into Africa.

Although sub-Saharan Africa's major oil producers have been pumping about 4.5 million barrels of oil per day, more output is expected in the future in the region.

In its Oil Outlook to 2025, a review paper released last year, the Organization of the Petroleum Exporting Countries (OPEC) forcast that oil production in the African region will increase significantly over the medium term. Increases in output from this region will be primarily from Angola, it said, followed by Chad, Sudan, Congo and Equatorial Guinea.

Angola's state-owned oil company, Sonangol, announced in May 2003 that oil output could increase to 1.6 million barrels per dayby late 2005, up from current levels of 0.9 million barrels per day, due largely to the expected expansion of deepwater production.Deepwater projects that are yet to be tendered could push output up even further in the medium term, with some analysts believing that as much as 2.5 million barrels per day could be produced by 2010.

Onshore fields also offer opportunities for expansion. The completion in 2003 of the Chad-Cameroon pipeline will lead to land-locked Chad becoming the latest oil exporter in central Africa. A sustainable production peak of over 0.2 million barrels per day isexpected to be achieved. The potential for production increases inSudan is considerable, but is particularly contingent on the development of further pipeline capacity.

Exploration and development efforts are proceeding for the Greater Nile Project and elsewhere, and domestic sources have suggested that output could double to 0.6 million barrels per day by the end of 2005.

Production in Egypt peaked in 1995 at around 1million barrels per day, and has been generally falling since.

It is because of the more and more important role Africa is playing in the global oil market, that the World Petroleum Council(WPC), leading global organization on oil and gas, will be holdingits globally attended Congress in South Africa on September 25-29,the first time the organization holds its tri-annual Congress on the African continent in 72-year history.

According to Imogen Mkhize, CEO of the Congress, it is appropriate that an African country is hosting this year's event, given the intense exploration and drilling activity on the continent and "the congress is also a perfect place to showcase what South Africa and Africa have in terms of energy resources."

The Congress, like some analysts have said, is a fitting tribute at a time when the continent's influence on the world's energy industry has never been greater.

Source: Xinhua


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