Industry

Partners will reprocess 3D seismic data in PEL87.

Operator of Petroleum Exploration License 87 (PEL 87) offshore Namibia, Pancontinental Energy Limited, has received approval from the Namibian Ministry of Industry, Mines and Energy (MIME) on license extension by 12 months to 22 January 2027

During the extension period, the PEL 87 joint venture partners will undertake an environmental impact assessment (EIA), reprocess 3D seismic data and seismic interpretation, and drill an exploration well. 

Work is underway on the EIA since 2025 while a subset of PEL 87 3D is being reprocessed. Governing blocks 2713A and 2713B in the Orange Basin, seismic signal quality in the license, especially in targeted areas, will see marked improvement following reprocessing work.

Robert Bose, chief executive officer of Sintana Energy, said, "We are grateful to the Minister for the extension of PEL 87. We look forward to the continued refinement of the existing seismic work in anticipation of securing a farm in partner to progress the project to a focused drilling programme." 

Sintana has a 7.4% indirect carried interest in PEL 87.

Africa’s energy systems are deeply interconnected with global markets.

The escalating confrontation between the United States, Israel and Iran has introduced a new phase of geopolitical uncertainty into global energy markets

While the immediate focus remains on security implications in the Middle East, the commercial and operational consequences for Africa’s oil, gas and energy sectors are both significant and far-reaching. As global supply chains absorb the shock of rising tensions, African producers, exporters, importdependent states, and emerging energy markets are confronting a rapidly shifting landscape.

Africa’s energy systems are deeply interconnected with global markets. Crude exports, LNG flows, refinery feedstock, maritime transport and downstream pricing all depend on stable international conditions. When geopolitical volatility disrupts these conditions, the effects cascade across the continent’s upstream, midstream and downstream operations.

Oil price volatility and supply side uncertainty

The US-Israel-Iran conflict has injected renewed volatility into global oil markets. Brent crude prices have experienced sharp fluctuations driven by fears of supply disruption, potential sanctions and the risk of escalation in the Strait of Hormuz – a corridor through which roughly one fifth of global oil supply transits.

For established African producers and exporters – Nigeria, Angola, Libya, Algeria, Egypt, the Republic of Congo, Gabon, Equatorial Guinea and South Sudan – price volatility presents both opportunity and risk. Higher prices may boost short-term revenues, but instability complicates:

∙ fiscal planning

∙ production scheduling

∙ investment decisions

∙ long-term project financing

South Sudan is particularly vulnerable. Although it produces the crude, it relies entirely on Sudan for pipeline transit, refining and export through Port Sudan. Any geopolitical shock that affects global prices or regional stability amplifies the fragility of this arrangement already impacted by the internal conflict in Sudan.

For import-dependent African economies – Kenya, Uganda (until production begins), Rwanda, Tanzania, Ethiopia, Senegal, Ghana, and South Africa – price spikes translate into:

∙ higher fuel import bills

∙ inflationary pressure

∙ increased subsidy burdens

∙ downstream pricing instability

The conflict has therefore widened the divergence between Africa’s energy exporters and importers, with both groups facing heightened commercial risk.

LNG shipping disruptions and maritime chokepoints

The Red Sea, Bab elMandeb, and the Strait of Hormuz remain critical arteries for global LNG and petroleum shipments. Rising tensions have led to:

∙ vessel diversions

∙ increased war risk insurance premiums

∙ longer shipping times

∙ higher freight costs

∙ rerouting around the Cape of Good Hope

For African LNG exporters – notably Algeria, Egypt and Mozambique – these disruptions affect:

∙ delivery schedules

∙ contract performance

∙ shipping economics

∙ buyer confidence

Mozambique, in particular, is emerging as a major LNG player. Its offshore reserves position it as a future global supplier, but project timelines and financing conditions are highly sensitive to global LNG market volatility. Any instability in shipping routes or pricing affects investor appetite and project momentum.

For LNG importing markets in North and East Africa, rerouting adds cost and uncertainty to already tight supply chains, affecting power generation, industrial output and domestic energy security.

Infrastructure and upstream project risk

Energy infrastructure across Africa – pipelines, refineries, offshore platforms, LNG terminals and power generation assets – is highly sensitive to global market conditions.

The current geopolitical environment has intensified:

∙ EPC contract renegotiations

∙ project delays

∙ cost escalations

∙ supplychain bottlenecks

∙ financing challenges

Upstream investment decisions are being recalibrated as international oil companies (IOCs) and national oil companies (NOCs) reassess:

∙ fluctuating price decks

∙ higher insurance premiums

∙ sanctions exposure

∙ shipping and logistics risk

Emerging producers such as Uganda, Namibia and Ghana are particularly exposed.

∙ Uganda’s Tilenga and Kingfisher projects, along with the EACOP pipeline, depend on stable financing and predictable price environments.

∙ Namibia’s offshore discoveries have generated global excitement, but long-term development decisions hinge on market stability.

∙ Ghana, while already producing, remains sensitive to price swings and relies heavily on imported refined products.

These countries illustrate how geopolitical conflict affects not only current production but also Africa’s future energy trajectory.

Commercial and contractual pressure across the value chain

The combination of price volatility, shipping disruptions and project delays has increased contractual tension across the African energy sector. Key areas of pressure include:

∙ crude supply agreements

∙ LNG offtake contracts

∙ pipeline transportation agreements

∙ refinery feedstock contracts

∙ EPC and O&M contracts

∙ charter party and shipping arrangements

Force majeure claims, renegotiation requests and performance disputes are to become more common as parties struggle to meet obligations under rapidly changing conditions.

This is where commercial risk management becomes essential.

Why ADR is becoming critical in Africa’s energy sector

In a period of heightened geopolitical uncertainty, effective, neutral dispute resolution capacity is no longer optional – it is a strategic necessity.

Energy disputes often involve:

∙ crossborder parties

∙ complex technical issues

∙ high value contracts

∙ time sensitive operations

∙ confidentiality requirements

Alternative Dispute Resolution – particularly arbitration, mediation and expert determination – offers:

∙ neutrality

∙ enforceability

∙ sector-specific expertise

∙ procedural flexibility

∙ continuity of commercial relationships

As global conflict continues to reshape commercial risk, African energy companies, investors and governments increasingly require dispute resolution professionals who understand both the geopolitical landscape and the operational realities of the oil and gas sector.

Africa’s energy future in a volatile world

The US-Israel-Iran conflict has underscored a fundamental truth: Africa’s energy markets are deeply exposed to global geopolitical shocks. From upstream investment to LNG shipping, refinery operations and downstream pricing, the continent’s oil and gas sector must navigate a more volatile and interconnected world.

For African producers, importers and infrastructure operators, resilience will depend on:

∙ robust commercial risk management

∙ flexible contracting strategies

∙ diversified supply chains

∙ and access to principled, neutral dispute resolution mechanisms

In this environment, the ability to anticipate disruption – and resolve disputes efficiently when they arise – will be essential to sustaining Africa’s energy growth and stability.

The article has been written by Elijah Paul RukidiMpuuga, FCIArb​, International arbitrator and founder, Equitas Dispute Resolution Group 

The transaction will accelerate debt reduction for Kosmos. (Image source: Kosmos Energy)

In terms with an agreement in place, Panoro Energy has acquired 40.375% non-operating working interest in the Ceiba Field and Okume Complex production assets offshore Equatorial Guinea

Alongside future contingent payments that add up to US$39.5mn, the transaction is worth US$180mn.

This will give Panoro ownership of interests in Block G, with contingent payments of US$12.5mn linked to production performance at the Ceiba field and US$9mn payable in each of 2027, 2028 and 2029, subject to price and production volatilities. 

The transaction enhances liquidity from monetising non-core assets and accelerates debt reduction for Kosmos. Proceeds will be used to reduce borrowings outstanding under the reserves-based lending (RBL) credit facility.

Put in place during January, the transaction process will be through mid-year. It has been approved by the Government of Equatorial Guinea, and completion only remains subject to CEMAC customary approval. Over the two-year period post completion of the transaction, Kosmos expects to realise approximately US$100mn in total savings across capital expenditures and general and administrative expenses.

Andrew G Inglis, Kosmos Energy’s chairman and chief executive officer said, “This transaction reflects our continued focus on capital discipline and balance sheet resilience. The high-grading of the portfolio by accelerating the monetisation of later-life, non-operated production assets enables Kosmos to focus our capital and expertise on our world-class assets where we can add the most value for our stakeholders over the long-term. The proceeds from the transaction enhance liquidity and accelerate debt reduction, while the contingent payments ensure we retain exposure to future upside.”

Ojulari said that Nigeria must move towards aligned pricing frameworks. (Image source: NNPC)

The Nigerian National Petroleum Company has identified the key pillars for securing Africa’s energy future during the recently concluded 2026 International Energy Week (IEW) in London 

The NNPC's group chief executive officer, Bashir Bayo Ojulari, highlighted the importance of shared infrastructure, policy alignment, coordinated investment frameworks, cross-border knowledge and technology exchange, integrated gas market development, and sustained regional diplomacy among national oil companies (NOCs).

As shared assets can lead to scale, efficiency and resilience, NNPC is prioritising the expansion of cross-border energy infrastructure, with regional gas initiatives ongoing in the region. Flagship projects such as the Nigeria–Morocco Gas Pipeline and the West African Gas Pipeline are critical for advancing regional integration and cross-border energy trade. 

Ojulari said that the continent must move towards aligned pricing frameworks, transit protocols, local content standards, and joint technical regulations, drawing lessons from reforms such as Nigeria’s Petroleum Industry Act (PIA), to reduce investment friction, safeguard cross-border infrastructure, and ensure equitable access to shared energy assets.

“Our pathway is clear: grow production responsibly, scale gas as the backbone of Africa’s industrialisation, strengthen environmental accountability, and align with global decarbonisation objectives—while ensuring that Africans are not left behind in the energy transition,” he said.