In the 2021 Outlook however, the African Energy Chamber has called on African governments and industry stakeholders to come together and do more to support the oil and gas sector’s competitiveness and attractiveness
Despite its remarkable resilience, Equatorial Guinea’s oil sector is facing the same dire situation as the rest of global energy markets: plunging oil prices, uncertain demand and dry of capital on the back of the energy transition. In such a context, the country has embarked early on an ambitious investment outreach programme with the Year of Energy 2020 and the Year of Investment 2021.
A key concern for Equatorial Guinea’s oil and gas industry remains the lack of competitiveness of its fiscal terms and the lack of an attractive enabling environment that supports local private sector growth and jobs creation.
“The time for fiscal reforms in Equatorial Guinea and the CEMAC region is now. If we do not act now, our companies risk going bankrupt, our economic parameters will worsen and our jobs will be in jeopardy,” declared Leoncio Amada NZE, CEO of APEX Industries and Head of the CEMAC Region at the African Energy Chamber.
To support recovery and boost investment, the African Energy Chamber’s 2021 Outlook offers several pragmatic solutions. The Chamber has issued a call to action to policy makers and stakeholders around the adoption of bold fiscal reforms and the modernization of regulatory frameworks to bring back investors’ confidence. Similarly, the Chamber is increasingly engaging with financial institutions and banks on making capital more easily available to local entrepreneurs.
Finally, the 2021 Outlook also calls for a much wider adoption of natural gas across the economy, and a stronger industry dialogue to boost capacity building. “It would help if governments across the region caucus with international oil companies and the petroleum industry as a whole when drafting policies that are going to affect the industry. The voices of local and international investors need to be heard in order to adopt market-driven policies,” declared Simon Smith, vice-president and country manager at Marathon Oil Corporation.
“There is tremendous pressure from NGOs and green energy lobbyists, but there is still a future for the oil and gas industry in Africa. We have the right to exploit our natural resources to build our economies, and our natural gas potential offers such an opportunity,” added Oscar García Bernico, general director of State Entities at the Ministry of Mines and Hydrocarbons. The Chamber has indeed highlighted how Africa’s gas potential, much more important than oil, is a key advantage for the continent as it seeks to embraced the energy transition and retain foreign capital.