Browsing: African oil producers

Revenues from the booming oil sector are transforming Chad into an attractive place for businesses and trades. www.theexchange.africa

The major petroleum groups had long been reluctant to become involved in Chadian oil fields. The fields in the central/western and northern parts of the country were located in areas of chronic insecurity.

Then, an unprecedented arrangement was made. The World Bank agreed to finance using public funds. The pipeline would later allow the private operators Exxon, Chevron, and Petronas to transport their crude oil to the Cameroonian port of Kribi. This would enable shipping to European or American refineries, where the oil could be offered on the market at prices that the cost of the transport infrastructure would not burden.

Chad faces military challenges on most of its borders which should be factored as a risk. In the west, in the region of Lake Chad, the army has been fighting the Nigerian Islamist group Boko Haram since 2015. On the border with Sudan, Eastern Chad has seen conflicts between different ethnic groups. Northern Chad is also unstable, sparsely populated, and difficult to control. Several Chadian rebel groups have set up their base in neighbouring southern Libya. Despite these problems, Chad’s armed forces are considered by many analysts to be the most effective in the Sahel.

There are still questions about Africa’s ability to serve as a viable interim option for natural gas while Europe confronts Russia’s military offensive. According to experts, a historical lack of investment in gas infrastructure has harmed Sub-Saharan Africa’s energy business compared to Northern Africa.

For example, Algeria’s Maghreb-Europe Gas Pipeline connects Algeria – Africa’s largest natural gas exporter – to Spain and Portugal via Morocco, and Algeria’s Medgaz pipeline connects Algeria directly to Spain. However, a decline in gas output caused the decline due to a breakdown in relations with Morocco; Algeria declared last October that it would immediately begin delivering gas straight to Spain.

It is critical to remember that [North] Africa already had a developed gas export market with Europe [pre-Ukrainian crisis]. The projected expansion of the Medgaz pipeline capacity [in Algeria] is to boost shipments to Europe.