Top 5 Oil Producing Countries in Africa

Oil Producing Countries in Africa

Five of the top oil producing countries in Africa which also are among the top 30 oil-producing countries in the world, have immensely contributed to the continent’s output of about 9.6 percent of the world’s total output.

In 2019, Africa accounted for more than 7.9 million barrels per day in production, an output level that has significantly dropped from nearly 10 million barrels per day in the period between 2005 and 2010. The major production declines were attributed to lower global oil prices.

However, 2015 to 2019 saw a more stabilized output period but before it could be celebrated, the Covid-19 pandemic stroke. This resulted in a production dispute between two oil giants – Russia and Saudi Arabia at the onset of 2020 – dramatically resulting into reduced oil prices and affecting the global oil pricing and production.

As a result, future levels of oil production in Africa and around the world have remained highly uncertain as the world enters the second half of 2020.

Oil Producing Countries in Africa have relied on crude oil exports for large portion of their revenue. They have since been greatly affected by the situation with some countries like Nigeria warning of an imminent recession and seeking for international emergency funding to remain afloat.

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Africa has in the past decade experienced a significant reduction in oil production. Here is a list of top Oil Producing Countries in Africa 2019, according to U.S. Energy Information Administration (EIA) datasets, and the factors contributing to the decrease in production.

1. Nigeria
Nigeria, Africa’s largest oil producer and also home to the second-largest proven oil reserves in Africa, produced more than 2.5 million barrels per day between 2015 and 2019. The country whose oil reserves stand at 37 billion barrels is among the top 10 largest oil producer in the world.

Oil exploration efforts in some oil rich regions have been hindered by insecurity linked to terrorist groups in the country. According to EIA, the unstable annual oil production since around 2005 can be attributed partly to the security problems.

Exxon Mobil, Eni, Chevron, Total and Shell are some of largest global oil companies operating in Nigeria but regulated by the state-owned Nigerian National Petroleum Corporation (NNPC)

2. Angola
In 2019, Angola produced approximately 1.4 million barrels of oil daily in a declining production trend from around 1.8 million barrels per day in 2015. The decline is attributed partly to a production-cut agreement among OPEC, OPEC+ and G20 stakeholders that Angola agreed to.

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Angola has profuse offshore and deep-water oil reserves in the South Atlantic. Some significant international oil companies have explored and operated the Angola reserves. They include; China National Offshore Oil Corporation (CNOOC), Total, BP, Chevron, Eni, Exxon Mobil, and Statoil.

3. Algeria
With a production of about 1.3 million barrels of oil per day in 2019, Algeria remains one of the top tier oil producers in Africa. However, production has substantially gone down since 2005 when Algeria’s output was almost 1.7 million barrels per day. Production-cut agreement among OPEC members and a lack of investors has played a major role in the nation’s declining oil output.

Sonatrach is the dominant oil company in Algeria. Other companies operating in the country include BP, Total, and Exxon Mobile.

4. Libya
Almost 1.2 million barrels per day was produced in Libya in 2019, a 100% increase since 2016. The eccentric increase was primarily attributed to a temporary truce among warring groups in the country, and an exemption from OPEC production cuts in 2016.

As of early 2020, civil war in Libya intensified and production fell drastically. Regardless of its challenges, the nation holds the largest proven reserves of oil in Africa.

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Libyan oil production was active with the presence of international oil companies before the conflicts. Unfortunately, much cannot be said of the future of oil production and exploration in Libya until lasting stability is realized.

5. Egypt
Egypt’s output has remained notably steady with an oil production of about 630,000 barrels per day in 2019. The largest oil producer in Africa, though not a member of OPEC, witnessed a remarkable stability between 2014 and 2019. Government’s pro-market reforms reduced subsidies for the oil industry.

Egyptian government has worked to make the country more attractive to foreign investment by implementing investor friendly reforms like reducing subsidies to EGPC and reducing the amount of payments in arrears to international oil companies.

Egypt’s state-owned oil company, Egyptian General Petroleum Corporation (EGPC), partners with several international oil companies like Eni and BP in offshore and onshore production operations.

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According to NJ Ayuk, Executive Chairman, African Energy Chamber – COVID-19 pandemic will continue to test African countries on multiple fronts and has set a rough path for the African oil and gas industry. However, he notes that the painful situation is not permanent and when it’s over, African countries should be able to recover.

He says: “This is the time to lay the framework for that recovery. When demand for crude oil increases again, and it will, Africa will need exploration and production activities to resume. That means oil and gas ministries should be working now on regulations that foster a more enabling environment for investors and businesses. We should be fine-tuning our local content policies and exploring technologies that can contribute to a leaner, more profitable petroleum sector.”