PwC forecasts Nigeria to drive Africa’s gas supply from 2021


With the uncertainty trailing oil exports and revenue due to the lingering impact of the pandemic, PriceWaterhouseCoopers, PwC has advised Nigeria and other African countries to be strategic in their energy transition plans, while exploring opportunities in gas development.

It noted that much of Africa’s gas supply growth will come from Nigeria, PwC, in its Africa Oil and Gas Review 2020, themed energising a new tomorrow, added that the positive outlook for natural gas, which is often termed the renewable bridging fuel due to its lower carbon footprint, will see stronger price and demand recovery as countries move to rebuild their economies.

The report reflected the opportunities in gas export for Nigeria, noting that Africa consumes 63% of its total gas production, predominantly for power generation, even though the continent’s gas exporting countries saw a total decline of more than 6% in 2020 from 39.7 mtpa in 2019 to 37.3 mtpa in 2020.

Available data show that Nigeria produces 49.3bcm of gas, with 24.8bcm or 50.3 per cent exported to Europe and Asia. Indeed, projections on natural gas demand in Africa show a gradual increase over the next 20 years with global peak gas only expected towards 2035–2040.

Already, the Federal Government had restated its focus on gas as a platform to drive a truly sustainable in-country economic diversification.

The Minister of State for Petroleum Resources, Timipre Sylva, recently said: “Our strategy to strengthen the Nigerian oil and gas industry in a post-COVID-19 world is to transform our national oil company into a diversified energy holding company to enable us respond swiftly to the twin challenges of a future crash in crude oil prices and decarbonization, by moving rapidly to becoming an energy holding company with more diverse interests.

“Consequently, we have strategically focused on our vast natural gas resources, as a critical transition fuel to help battle global warming and function as bridge between the dominant fossil fuel of today and the renewable energy of tomorrow”.

PwC however warned that with the fragile energy infrastructure and a high level of energy poverty in Africa, governments must pay particular attention to the implications of COVID-19’s impact on the energy sector.

Specifically, PwC highlighted the need to advance energy access and rebuilding economic activity through industrialisation as being more critical than ever.

It added that from a long-term energy markets perspective, African economies need to reconsider their reliance on fossil fuel exports and will have to develop their renewable energy and green economy strategies.

“Unlike in the developed world, however, African countries largely lack the fiscal reserves and domestic market resilience to go beyond the immediate fiscal response to stimulate economic activity through policy and investment in areas such as infrastructure development and green energy transition.

“By contrast, the developed world, which has the fiscal reserves and market capability, is using the energy transition as a key driver of economic stimulus. Accelerating policy shifts towards greening economies and early run-out of fossil fuels is being coupled with very large investment stimulus for greening technologies and implementation. The unintended consequence of this, however, is that it is accelerating the decline of the global oil and gas markets on which so many African countries depend”, the report added.

The report also showed that Africa oil exports remained static at 7.1 mmbbl/d between 2018 and 2019. However, due to COVID-19 in 2020, exports saw a decline of more than 10%. The top five African crude oil exporting countries experienced a total decline of 11% from 5.3 mmbbl in 2019 to 4.2 mmbbl in 2020.

On oil and gas projects, the report stated that the 2020 COVID-19 disruption has, reversed many of the sector gains and seen project delays and cancellations.

Already, many oil and gas majors in Africa (including BP, Shell, Total, Eni and ExxonMobil) have announced that start-up dates of their major projects are expected to be delayed by 1–3 years and smaller projects may be cancelled.

Nigeria, Mozambique, Senegal, Kenya, Mauritania and Uganda are faced with project and FID deferrals, while two of Total’s projects in Angola are facing outright cancellation.

“Further examples of projects at risk are in Tanzania where, despite having world-class reserves in blocks owned by Equinor and Shell, no major LNG production has yet to be realised.

“Following COVID-19, both these international oil companies, IOCs have stated their intentions to diversify further into renewables and move away from hydrocarbons. The financial capability to fund mega-billion-dollar projects has also been called into question with Shell recently reporting major financial losses and announcing a significant reduction in its global workforce”, it added.


A journalist by profession and I have been in active practice for so many years. A graduate of Political Science from University of Abuja. Maried with four children.

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