Energy investment outlook in Africa
The upstream oil and gas sector in Africa is expected to reach $41 billion in investments in 2026, a slight increase from $40 billion in 2025. This progression is occurring in a context of recovery in global exploration and production spending, with a total expected to be around $504 billion.
Offshore activity is the main driver of this dynamic. Offshore investments in Africa are expected to reach $19 billion in 2026, with an average annual growth of 6.6% %, approaching $54 billion by 2030. Deepwater projects represent the bulk of this growth.
Four factors explain the current investment cycle:
- Major Deep-Sea Discoveries in Namibia and Tanzania
- A new wave of competitive tenders across the continent
- Legislative reforms in Nigeria and Angola significantly improving returns for investors
- The legally regulated progressive phasing out of Russian gas in Europe, which is redirecting LNG purchases towards Africa.
The closure of the Strait of Hormuz in early March 2026 amplified these dynamics, particularly the latter. With Qatari supplies disrupted and U.S. LNG terminals near maximum capacity, African LNG has shifted from being one diversification option among others to a short-term supply priority.
Nigeria and Angola: Major destinations for upstream investments in Africa
Nigeria and Angola continue to attract the largest share of new capital. In both cases, regulatory reforms have been decisive in restoring investor confidence.
In Nigeria, the Petroleum Industry Act has generated over $17 billion in foreign direct investment. The 2025 licensing round targets technically sound operators, with signature bonuses ranging from $3 to $7 million and an estimated $10 billion in investments expected over the next decade.
Shell's final investment decision on the Bonga North deepwater project (US$5 billion) in December 2024 was seen as a strong signal of renewed confidence. The project aims for a maximum production of 110,000 barrels per day.
In Angola, reforms have been more progressive. The creation of the independent regulator ANPG has allowed the separation of state supervision functions from those of Sonangol. Tax measures were then put in place to extend the lifespan of mature assets.
Presidential Decree 8/24 introduces incentives for additional production, while a 30-year gas master plan is being finalized.
Azule Energy, the joint venture between BP and Eni, reports a 25 % increase in gross production and a 140 % increase in reserve renewal, illustrating the impact of these structural reforms.
Major discoveries reshaping the African energy map
Namibia
The Orange Basin has yielded some of the most important discoveries of the last decade. TotalEnergies' Venus discovery could be subject to a final investment decision in 2026, with first production expected in 2029. A restructured partnership with Galp strengthens TotalEnergies' stake in Mopane to 40 %, paving the way for multi-field development.
Tanzania
The country has approximately 57 trillion cubic feet of gas and, in 2025, launched its first tender in over a decade (26 blocks). The Tanzania LNG project ($42 billion), led by Shell and Equinor, aims for an agreement with the state by mid-2026. Production is expected in the early 2030s.
Mozambique
TotalEnergies relaunched its Mozambique LNG project ($20.5 billion) in January 2026 after more than four years of suspension. First production is now expected in 2029. However, the security situation in the Cabo Delgado region remains a critical factor. Conversely, Eni is successfully continuing its offshore Coral South FLNG project, demonstrating the relevance of floating LNG in high-risk environments.
Three key projects investors will be watching in 2026
Bonga North - Nigeria
$5 billion deepwater project operated by Shell, with approximately 300 million barrels recoverable. First production expected before 2030.
Lake Albert – Uganda
The Tilenga and Kingfisher projects are 70% complete %, with first oil expected in June 2026 (190,000 barrels/day). The EACOP pipeline is progressing despite legal challenges.
BirAllah gas field - Mauritania
With approximately 80 trillion cubic feet of gas, this project ($17 billion) is seeking a new operator after TotalEnergies' withdrawal. Its development could favor floating LNG.
Key risks for investors to consider
- Mozambique: Persistent Security Instability in Cabo Delgado
- Senegal: Review of oil contracts by the new government
- DRC: environmental risks related to forest and peatland areas
- EACOP: Legal proceedings still ongoing
Why 2026 represents a strategic window
Africa is expected to account for around 40 % of major exploration wells drilled globally in 2026. Deepwater drilling rig day rates are already approaching $400,000, with capacity constraints expected from 2027.
International majors are concentrating their investments in offshore oil and LNG, while regional players are consolidating mature onshore assets. Opportunities exist in both segments, but cost and access advantages clearly favor those positioning themselves now.
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