Consulting editor(s): Marc Hammerson and John C LaMaster, Akin Gump Strauss Hauer & Feld LLP
Publication date: May 2015
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Although there has long been oil and gas activity in Africa, there has been a recent renewal of interest in the continent – particularly in jurisdictions without existing production. Countries with established industries continue to mature, develop and indigenise. However, many problems (eg, security concerns, corruption, political risk and environmental issues) constrain production levels and have resulted in acquisition and disposal activity as companies rebalance their portfolios to reflect these risks.
Beyond these established players, the pool of African producing nations is expanding and the next few years will see countries with no or limited production becoming an important source of global supply. Much of this new activity is taking place in East Africa – particularly oil production in the north (Kenya and Uganda) and liquefied natural gas (LNG) and gas projects in the south (Tanzania and Mozambique). Other countries such as Namibia and Somalia are exploring for their first significant discoveries.
This book discusses the opportunities and challenges. Chapters describe the production sharing contract (PSC) and economic terms governing regional exploration and production activity. Although PSCs are not an exclusive host government instrument, they are of growing importance for countries looking for greater control over, and societal benefits from, petroleum production. The book also covers financing, M&A, valuation, local content, state participation, security and decommissioning issues in an African context. Additional chapters deal with OHADA – an attempt to harmonise business laws across 17 countries in West and Central Africa – and natural gas and LNG projects.
The book has been authored by leading industry participants, petroleum consultants, lawyers and security advisers with experience of working in Africa. It will benefit other industry participants and advisers pursuing oil and gas opportunities across the continent.