Impact of the Oil Price Fall On Exploration and Production Activities in Africa

In Africa, oil explorers will keep drilling and producing from select locations such as onshore east Africa and less complex projects off the West African coast even with oil at $60 a barrel.

For example, low operating costs of around $10 per barrel of oil equivalent for Ghana’s Jubilee field will mean cuts have a limited impact there compared to operating costs in the UK North Sea (a mature oil region) which average $27 per barrel of oil equivalent — a whopping 170% margin on a like for like basis!

However, frontier projects such as those in the pre-salt basins offshore Namibia and South Africa as well as Angola and Gabon where vast oil reserves deep underwater beneath a salt layer are susceptible to cuts if the price continues to fall.

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About the Author

Theo Acheampong
Theo is an economist and social media enthusiast who provides regular commentary on socioeconomic and political developments in Ghana and Africa at large. Theo is passionate about leadership, entrepreneurship and the role of innovative technologies in solving Africa's developmental challenges.