Gulf of Guinea oil returns to strategic appeal as global energy shocks intensify -. Carnegie.
The Gulf of Guinea is regaining strategic importance as an alternative source of oil and gas for Western markets, with geopolitical turmoil, offshore discoveries and regulatory reforms reviving investor interest in West Africa, according to an analysis published by the Carnegie Endowment for International Peace.
"Energy production in West Africa is suddenly strategic again," wrote non-Carnegie researcher Judd Debremont and Gabriel Posner of Prime in a Nov. 5 analysis. They called for renewed US engagement with African manufacturers amid disruptions related to the US-Israeli war with Iran and threats to shipping routes in the Middle East.
The researchers recalled that the US National Intelligence Council predicted in 2000 that West Africa could supply 25% of North American oil imports by 2015. Instead, crude and petroleum products from West Africa accounted for less than 3% of US imports that year, as US shale production expanded and African investment faced regulatory and security hurdles.
The recent disruptions have revived the argument for diversifying the energy supply. International Energy Agency (IEA) Director General Fatih Birol described the war as "the greatest energy security threat in history." Carnegie estimates that the Gulf of Guinea, broadly defined to encompass much of Africa's Atlantic coast, holds 4.5% of global oil reserves and 2.7% of gas reserves. Its location offers access to European and American markets without the need for shipments to pass maritime choke points in the Middle East.
Much of the region's crude is light and sweet, making it attractive to refiners, the researchers noted. Advances in seismic imaging and deepwater drilling have also opened up previously difficult exploration areas, while licensing rounds are attracting interest in Benin, Cameroon, Gabon, Liberia, Nigeria, Sierra Leone and other coastal countries.