According to data from Wood Mackenzie, Nigeria led the continent in upstream capital expenditure (capex) in 2024, fueled by a series of incremental deepwater initiatives and ongoing operations in its abundant offshore basins.
The country surpassed Angola, which had previously maintained this position, by leveraging key oil projects such as the Agogo-Ndungu development by Azule Energy, along with the ongoing infill projects by TotalEnergies in Block 32 and Block 17.
Olu Verheijen, the special adviser on energy to President Bola Tinubu, stated on Monday that Nigeria's success is closely linked to the approval of five significant presidential directives and the fiscal incentives introduced this year.
“These transformative measures are not only reshaping Nigeria’s energy landscape but also setting the stage for unprecedented levels of investment in 2025 and beyond, reaffirming Nigeria’s role as a powerhouse in Africa’s energy sector,” Verheijen said on X, formally known as Twitter.
Nigeria's Major Projects Drive Growth
Wood Mackenzie highlights several significant investments in Nigeria's oil sector, including the Iseni project, which has a projected capital expenditure of $122 million and reserves estimated at 84 million barrels of oil equivalent (mmboe).
In addition, the Ubeta project, with a capital expenditure of $566 million and reserves of 182 mmboe, is anticipated to enhance the nation’s oil production capabilities.
Moreover, Nigeria's premier offshore initiative, the Bonga North Tranche 1, is set to attract an investment of $4.6 billion, with reserves totaling 350 mmboe.
Another important development is HI (OML 144), a fixed platform project by Energes, which has pledged $2.6 billion for 327 mmboe in reserves. Although the final investment decision date is yet to be announced, this project is expected to play a crucial role in Nigeria's long-term oil production strategy.
While Nigeria's growth is impressive, Angola continues to attract significant investments as well. Major oil companies, particularly TotalEnergies and ExxonMobil, are concentrating on offshore projects in Block 31 and Block 20/11.
These efforts include drilling activities in the Kaminho I field, which remain essential to Angola's upstream investment, despite some marginal projects yielding lower-than-anticipated returns.
“The competition between Nigeria and Angola remains intense, but Nigeria’s ability to attract investment in its deepwater fields has proven decisive,” McDonald added.
Elsewhere in West Africa, Ghana, Senegal, and Côte d’Ivoire experienced a rise in upstream investment; however, the volume was less substantial than that of Nigeria.
“Focus on Ghana’s Presidential election slowed down upstream activities in 2024,” Wood Mackenzie said.
Angola's Departure and the Transformation of Regional Dynamics
Wood Mackenzie analysts observed that Nigeria's resurgence as a leader in the region is attributed to a series of strategic changes across the continent.
A significant event was Angola's exit from OPEC in early 2024.
“This was a constraint considering current production levels (~1.1 million b/d) and future ambitions,” stated Wood Mackenzie.
In an effort to reshape its narrative, Angola's National Assembly empowered its President to implement new regulations for incremental projects in both mature fields and undeveloped areas within producing licenses offshore.
“The objective is to maximise hydrocarbon recovery in producing areas and enable additional upstream investments,” Wood Mackenzie noted.
Additionally, Wood Mackenzie recognized the Niger-Benin pipeline, which became operational in 2024, marking Niger's entry as the latest oil exporter in Africa.
Nevertheless, exports through the pipeline faced temporary suspension due to border conflicts with Benin and internal insurgent activities. Following successful diplomatic negotiations, the pipeline resumed operations within four months, solidifying Niger's potential as a significant player in the regional energy landscape.
“Border disputes with Benin and internal rebel attacks soon halted exports via the pipeline. Niger explored alternate export options through Chad and other countries. However, successful diplomatic talks with Benin restored exports within four months,” Wood Mackenzie added.
The establishment of the African Energy Bank in June 2024 marks a significant milestone for the continent, according to industry experts.
Wood Mackenzie noted that the bank is anticipated to offer both debt and equity financing options for oil, gas, and renewable energy initiatives throughout Africa.
Transformations Across the Region
Elsewhere in Africa, findings from BusinessDay indicate that political changes and regulatory reforms are shaping the energy landscape.
In Mozambique, the ruling Frelimo party achieved a decisive victory in a controversial election held in October, which sparked months of violent protests. Meanwhile, in Senegal, Bassirou Diomaye Faye made history by becoming the youngest president, vowing to overhaul the nation’s oil contracts, a move that could have far-reaching effects on the industry.
Namibia also made headlines with the election of Netumbo Nandi-Ndaitwah as its first female president. As a member of the Swapo party, which has been in power since 1990, her leadership may herald further progress in Namibia’s oil and gas sector.
In South Africa, the government has taken significant measures to redefine its role in the energy sector. The merger of PetroSA, iGas, and the Strategic Fuel Fund (SFF) resulted in the formation of the South African National Petroleum Company (SANPC). Additionally, the approval of the Upstream Petroleum Resources Development Bill (UPRDB) in October has increased the state's stake in exploration and development projects to 20 percent.
Wood Mackenzie highlighted that the Upstream Bill introduces several modifications, including the rise in state participation from 10 percent to 20 percent, allowing the government to be involved in both exploration and development phases, covering costs that were not previously included.