The first week of November sees the annual pilgrimage of Africa focussed E&P companies, representatives from the majors, advisers and ministerial delegates to Cape Town – as well as the Tavistock team – to not only gain some November sun, but to take part in Africa Oil week.
The main conference attracted some 1,800 delegates this year with presentations and seminar sessions covering numerous aspects of the industry across the continent. Discussion topics included the future energy mix for Africa in the changing global picture, African exploration and production: past and future, upstream finance and the above and below ground risks of the Africa’s hot-spots. Post these sessions the evening networking events provided the opportunity for the smaller players to gain access to the majors as well as to ministers of countries they were looking to enter.
Whilst the activities at the main conference continued, the fringe remained a hive of activity as always. Many corporates and advisers with interests in the continent held extensive meeting programmes with partners, peers or consultants looking to build relationships, broker a deal or gain the latest gossip surrounding the sector – what blocks are up for grabs? who is looking for an exit? I know someone who might be interested in that. Who is looking to enter the arena? Who is backing them?
After the last couple of years, the mood in Cape Town was buoyant and optimistic. Activity levels in the sector are definitely seen to be on an uptick with farm outs and deals available and with the majors still shedding non-core assets in their portfolios which will continue to provide significant opportunities for the independents. There is also still a view that international investors remained somewhat reluctant to invest in projects, due to legacy or risk or climate issues. Whilst some players are prepared to take a punt on an opportunity, others are still wary and are still looking for a sure thing – if such a project exists!
One vibe for certain is that Africa is still very much a land of opportunity in the oil and gas sector. Opportunities are still seen to be available in Nigeria whilst given the activity which is planned for offshore Namibia, this area is seen as another potential hot spot with an air of expectation given the players that are involved in the year ahead. As for South Africa, whilst developing Brulpadda will undoubtedly have major challenges, a new exploration campaign is due to start in the first quarter of next year in an effort to establish more hydrocarbon resources for a country that undoubtedly needs them.
As the sun set on the conference and the delegates shared final glasses at the closing braai or at various dinners and drinks events there was an air of confidence for the year ahead. Across Africa next year there will be some exciting exploration drilling which has the potential to open up new regions. Deals will be done as new entrants look to come into the region. And in this industry, there is always the potential for something to surprise – all providing something to talk about next year!
Look forward to seeing you all in Cape Town in November 2020.