Many of the resource-rich countries in Africa have intensified efforts to become more attractive for exploration and production (E&P) investment. Reforms in licensing rounds, production sharing contracts, and fiscal policy are improving investor returns and are set to drive $41 billion in upstream investment in 2026, the African Energy Chamber’s State of African Energy 2026 Outlook shows.
From legacy oil producers Nigeria and Angola to emerging exploration hotspots such as Namibia, African resource holders are looking to compete with other regions for the billions of U.S. dollars that foreign investors could pour into their energy and minerals sectors.
Long-time producers, including the biggest oil producers Nigeria, Libya, and Angola, have made their licensing and fiscal policy more attractive, and emerging wannabe producers are offering incentives. All African countries are betting on boosting natural gas exploration, production, and development amid growing demand for gas and LNG for domestic use and for exports to Europe and Asia.
“The continent offers compelling opportunities for investors who are prepared to engage in a transparent, regulated, and increasingly competitive E&P landscape,” AEC executive chairman NJ Ayuk said in a statement.
“Governments and operators must continue to balance national priorities with investor confidence to unlock Africa’s vast hydrocarbon potential.”
Reforms in recent years have allowed Angola to improve its above-ground risk score since 2017, reflecting extensive regulatory and institutional reforms. Angola’s fiscal incentives, including terms for gas, marginal fields, and incremental production, have successfully attracted upstream investment, consolidating its status as a continental leader, AEC’s report said.
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While Angola is trying to reverse years of falling oil production, it bets big on standalone gas development and has just launched its first plant to process non-associated natural gas.
Angola also looks to accelerate the permitting phase of new minerals projects to attract investment. In October, Angola launched production at its first major copper mine, Tetelo, as the country looks to diversify into critical minerals.
Nigeria, the top oil producer in Africa, is auctioning 50 oil and gas blocks, eyeing $10 billion in new investments over the next ten years and 400,000 barrels per day (bpd) in additional production capacity.
Nigeria’s licensing program with updated terms and incentives targeting specific terrains and resource types has renewed interest in projects in the country and has boosted investor confidence in the upstream potential, evidenced in recent project approvals by Shell and TotalEnergies, AEC said.
Senegal and Cote d’Ivoire in West Africa have also attracted the interest and investment of the international majors.
Cote d’Ivoire has seen majors expand offshore development, and its huge oil and gas field Baleine started up production two years after discovery, thanks to Italy’s Eni.
According to the African Energy Chamber, Cote d’Ivoire maintains a pragmatic approach to foreign investment and regardless of the outcome of the 2025 presidential election, authorities are expected to continue supporting upstream investors while emphasizing adherence to local content requirements, particularly for offshore developments.
Real GDP growth in Senegal is expected at about 7.9% this year, driven by the first full year of oil and gas production, the International Monetary Fund (IMF) said last month. Senegal’s record-high economic growth rates followed the start-up of the Sangomar oil field offshore the West African country in June 2024, when Australia-based Woodside launched the country’s first offshore oil project.
Then there is the new exploration hotspot, Namibia, which is transitioning toward full producer status under President Netumbo Nandi-Ndaitwah, AEC’s report notes. The country has consolidated oil and gas oversight under the presidency and is establishing an independent hydrocarbon regulator.
However, proposed increases in the share of the national oil company NAMCOR and local content requirements could slow project approvals during a critical development phase, the African chamber warned.
Oil and gas supermajors, including Shell, TotalEnergies, BP, and Portugal-based Galp, have made large discoveries offshore Namibia.
Namibia hopes to become the next Guyana, but it lacks the infrastructure to fast-track the discoveries, which make them more expensive and difficult to develop and monetize.
Earlier this year, a senior official said that Namibia expects TotalEnergies and Norway’s BW Energy to take final investment decisions on oil projects in late 2026.
Last but not least, Mozambique is inching toward a cautious restart of onshore LNG projects following the stabilization of post-election political challenges and improved security in the Cabo Delgado area, the AEC said.
A few weeks ago, TotalEnergies lifted the four-year-long force majeure on the $20-billion Mozambique LNG project, and so did ExxonMobil for a separate project, the long-stalled Rovuma LNG, in northern Mozambique.
Across Africa, resource nationalism in the form of increasing local content requirements and shares for the national energy firms in projects could slow new project approvals, but the tide appears to have turned and supermajors are willing to develop Africa’s oil and gas potential.
By Tsvetana Paraskova for Oilprice.com
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