International energy producers are shifting their focus to East Africa as local companies in established markets expand their activities.
As companies develop new oil and gas fields in East Africa – from Mozambique in the south up to Tanzania, Kenya and Somalia – governments will be working hard to get the most they can out of the resources.
Analysts suggest that the licensing environment is becoming more difficult in Africa, with governments establishing ever more onerous requirements for international companies and, in some part, discouraging independent operators.
But, with the United States getting closer to energy self-sufficiency, the global energy landscape is also changing – and the new producers will be looking East to get the most out of their reserves.
There are 65 oil and gas companies in our Top 500 ranking, with a total turnover based on year-end 2012 results of $171bn.
This represents 23.2% of the total turnover, making it the largest sector by quite a margin.
Yet oil and gas revenue has stagnated, only increasing 1.2% on the previous year.
There has been stability in the oil price – which averaged $110 per barrel during the past three years – but some analysts are predicting a gradual down- ward movement in prices in 2014.
Nevertheless, 2013 was a very good year for Algeria's Sonatrach (#1), Africa's largest company, which in late October announced that it had made its largest discovery in 20 years.
The field is in Tamguid Messaoud, 112km from the Hassi Messaoud field, Algeria's largest, and is estimated to hold 1.3bn barrels.
Recovering them, however, will apparently require unconventional methods, which will be expensive.
At Africa Oil Week in Cape Town in November 2013 Lúmen Sebastião, from Angolan oil giant Sonangol's (#2) exploration division, told The Africa Report the state-owned company was busy re-evaluating its ultra-deep regions and the Kwanza onshore and offshore fields using new 3-D technology.
He said it had already revealed "lots of new prospects".
Sebastião said Sonangol planned a great deal more offshore drilling, particularly in blocks that had been neglected by the majors.
He said the government's plan is to boost production from today's 1.8m barrels per day (bpd) to 2m bpd and to sustain that level "for at least 10 years".
In December 2013, Sonangol, Cobalt and BP announced that they had discovered world-class gas reserves in the Lontra deepwater well.
In Nigeria, local oil companies are set to take advantage as multinational oil companies shed some of their onshore oil blocks.
Nigeria's Oando (#35) aims to complete its $1.7bn acquisition of US company ConocoPhillips' Nigerian assets by the end of January 2014.
The deal will boost Oando's oil output from just 4,000bpd currently to more than 43,000bpd.
Oando chief executive Adewale Tinubu told the Africa Oil Week in Cape Town that ongoing disinvestment from Nigeria by major international companies was creating "valuable new opportunities" for Nigerian companies and would ultimately boost national oil production.
Oando has until now been predominantly a downstream company, but Tinubu said that after the acquisition three-quarters of the company's assets would be in the upstream sector.
Total (#37) is set to become not only South Africa's largest fuel company but also one of its main producers of solar energy.
In November 2013, South Africa's Department of Energy selected US photovoltaic manufacturer Sun-Power, which is majority-owned by Total, as the preferred bidder for a $200m project to build an 86MW solar farm in Prieska in Northern Cape Province.
Egypt's ministry of petroleum announced in November 2013 that it is considering selling a 20% stake in Middle East Oil Refineries (#40), known as MIDOR.
He said the government expects to make "$1-1.5bn" from the sale.
Egypt owes at least $6.2bn to foreign creditors in the petroleum sector, and revenue from the sale of the MIDOR stake will go towards settling these debts.
Another company with cash flow problems is South Africa's state- owned PetroSA (#63), which is at an advanced stage in talks to buy Engen's petrol stations in the country for R11-18bn ($1-1.7bn).
If PetroSA cannot find the money by then, it expects to ask the government to make up the difference.
PetroSA urgently needs to find new sources of gas for its Mossel Bay gas-to-liquid refinery, as the nearby offshore well it has used is nearly exhausted.
It is feverishly drilling at the nearby F-O field in the hope of a major find but has had in the meantime to import liquefied natural gas from the Middle East to keep the refinery ticking, which has put additional strains on its cash reserves. ●