Press Release

Offshore Oil and Gas Production in West Africa Accounted for 74.3% of the Region's Total Production in 2011


August 31st, 2012

Global Information Inc. would like to present a new market research report, "Deep Offshore Oil & Gas Exploration and Production (E&P) in West Africa - Market Analysis, Competitive Landscape and Forecasts to 2020" by GlobalData.

The oil and gas production in West Africa increased from 1,432.8 million barrels of oil equivalent (MMboe) in 2001 to 2,105.7 MMboe in 2011 at an Average Annual Growth Rate (AAGR) of 3.9%. During the same period, offshore oil and gas production in the region increased from 843.7 MMboe to 1,564.2 MMboe at an AAGR of 6.2%. The share of offshore production in the regions total oil and gas production increased from 58.9% in 2001 to 74.3% in 2011.

The figure below shows the share of offshore production in the total oil and gas production in West Africa during the 2001-2011 period.

Angola has Recorded the Largest Number of Oil and Gas Discoveries in Offshore West Africa Since 2009

In the period 2009-2012, the highest numbers of oil and gas discoveries in offshore West Africa were made in Angola. Out of the 47 oil and gas discoveries made in deep offshore West Africa during the 2009-June 2012 period, Angola accounted for 17 or 36.2% of the total discoveries. The abundant offshore reserves have helped Angola to emerge as one of the most important countries in Africa for the exploration of oil and gas. After Angola, Ghana recorded the second-largest number of discoveries during the 2009-June 2012 period, with 11.

The figure below shows the number of oil and gas discoveries in offshore West Africa during the 2009-June 2012 period.

In 2012, up to June, four discoveries were made in deep offshore West Africa. All four discoveries were made in Cote dIvoire and Angola. The Paon-1X and Kosrou-1 oil discoveries were made in Cote dIvoire in June and April 2012, respectively. Both discoveries were made in Block CI-103. The Cameia-1 and Azul-1 discoveries in offshore Angola were made in February and January 2012, respectively.

Nigeria Recorded the Highest Offshore Oil and Natural Gas Production of 699.4 MMboe in West Africa for 2011

Nigeria recorded the highest offshore production of oil and gas in West Africa for 2011. The country produced 699.4 MMboe oil and gas from its offshore areas. Nigerian offshore production accounted for approximately 44.7% of the total offshore production in West Africa.

The figure below shows offshore production of oil and gas in select countries in West Africa for 2011.

The high offshore production of oil and gas in Nigeria is due to the abundant presence of oil and gas in the country. Nigerias oil reserves were estimated to be approximately 37.2 billion barrels as of 2010. The countrys Niger River Delta accounts for most of these reserves.

Apart from oil, Nigeria is also well-known for its natural gas reserves. The countrys natural gas reserves were estimated as the largest in Africa and the seventh-largest in the world. It recorded 185.3 trillion cubic feet (tcf) of proven natural gas reserves in 2010.

Offshore Oil and Gas Production in West Africa is Expected to Increase at an Average Annual Growth Rate (AAGR) of 3.8% during 2011-2020

The production of oil and natural gas from offshore West Africa is expected to increase from 1,564.2 MMboe in 2011 to 2,201.6 MMboe in 2020 at an AAGR of 3.8%. The offshore production of oil and gas is expected to reach 2,011.4 MMboe by 2015 due to realization of production from projects in important producing countries such as Nigeria and Angola. Beyond 2015, production is expected to increase marginally due to the maturing of production fields in countries such as Equatorial Guinea, the Republic of the Congo and Nigeria.

The figure below shows forecast production of oil and gas from West Africas offshore fields for 2011, 2015 and 2020.

Increasing Piracy Attacks are Affecting Oil and Gas Exploration and Production Operations in Offshore West Africa

Increasing piracy attacks are affecting the deep offshore oil and gas exploration and production in West Africa. In March 2012, the International Bargaining Forum (IBF), a body of maritime employers, and the International Transport Workers Federation, gave a “high risk area” designation to the territorial waters of Nigeria and Benin due to an increasing number of pirate attacks. Most of these attacks involved theft, especially of oil. The pirate attacks are mainly concentrated in the Gulf of Guinea, the most important offshore oil and gas exploration and production region in West Africa. Most of the pirate attacks were focused on diesel and oil-carrying vessels.

Out of the West African states, Nigeria emerged as the source for pirate attacks in offshore West Africa. The United Nations International Maritime Organization reported in March 2012 that the Nigerian pirates were responsible for 10 attacks in offshore Nigeria during January to February 2012. The Nigerian pirates were also responsible for an attack in offshore Benin in early 2012.

A major consequence of the increasing piracy attacks on oil and gas operations in offshore West Africa is an increase in insurance costs. Lloyds Market Association - a London-based insurers body - increased the risk ratings of off shore waters of Benin and Nigeria in 2012, which will result in high shipping insurance rates, including for oil transportation. The increasing pirate attacks could also potentially affect the plans for increasing production of oil in offshore West Africa.

The attacks could also affect the plans of the US, which intends to import 25% of its crude oil requirements from West Africa by 2015.

Sonangol and Nigeria National Petroleum Corporation (NNPC) Lead the Exploration and Production of Oil and Gas in Offshore West Africa

Most of the major International Oil Companies (IOCs), such as Total SA, ExxonMobil Company (ExxonMobil), Total SA, Eni SpA, Royal Dutch Shell Plc (Shell) and BP Plc, have a presence in the offshore West African regions oil and gas exploration and production sectors. Even the West African National Oil Companies (NOCs) of regional countries are steadily being involved in exploration and production activities in the region. Sonangol E.P. (Sonangol), Nigeria National Petroleum Corporation (NNPC) and Ghana National Petroleum Corporation (GNPC) are some of the major NOCs with operations in offshore West Africa.

In offshore West Africa, Sonangol is one of the leading companies among IOCs and NOCs in terms of the number of exploration blocks it holds. The company had 31 active offshore exploration blocks in Angola in 2011. In general, IOCs are dominant in the exploration activities of deep offshore West Africa, though NOCs are steadily increasing their presence.

Both IOCs and NOCs are involved in the production of crude oil and natural gas offshore West Africa. NNPC, a major NOC, recorded one of the highest crude oil and natural gas production offshore West Africa at 185.9 MMboe in 2011. ExxonMobil Corporation, a major IOC, is a leading producer of oil and gas in Nigeria and Angola, The company recorded production of 221.1 MMboe across the whole offshore West Africa region. In general, IOCs dominate oil and gas production in offshore West Africa, though NOCs are also steadily gaining ground.


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