Shoreline Group's Kola Karim talks future of Africa's oil & gas industry

The total deal value for Africa's oil and gas industry in 2016 was reported to be $4.9 billion from 61 deals, with 92% of these deals focusing on upstream projects, according to a recent report by Ernst and Young. Kola Karim, Chairman of Shoreline Group, discussed the future of Africa's oil and gas industry at the World Economic Forum on Africa in Durban. During the forum, key points were raised regarding the collaboration between governments, private sectors, and local communities to ensure sustainable development in the industry. Karim emphasized the importance of involving local communities to avoid conflicts over natural resource exploitation. He also addressed the impact of global market dislocations on deal-making in the upstream sector and highlighted the significance of opportunities in the downstream sector, particularly in countries like Nigeria where refineries are not fully functional, leading to high levels of importation and supply distribution challenges in the local market. Karim further pointed out game-changing opportunities in the continent's oil and gas future, noting the critical need for reserve replacement and increased investments in the upstream sector. Despite reduced investments due to lower oil prices, he expressed optimism about future activities, especially with oil prices stabilizing around $50-$70 per barrel. The focus is shifting towards further investments in exploration and production across the continent. In a positive development, Karim discussed the increase in Nigeria's oil production to 2 million barrels per day, attributing it to improved government-community relations in the Niger Delta region. The engagement with local communities and companies' involvement has contributed to easing tensions and boosting production levels. Karim also emphasized the significance of the Petroleum Industry Governance Bill (PIB) in cleaning up the sector, enhancing transparency, and accountability. He expressed confidence in the bill's potential to revitalize the industry and create a more stable and profitable environment for stakeholders. The passing of the PIB is crucial for the industry's growth and stakeholders are eagerly awaiting its implementation to drive positive changes in Nigeria's oil and gas sector. Karim's insights shed light on the promising outlook for Africa's oil and gas industry, underscored by opportunities for collaboration, sustainable development, and regulatory reforms to foster growth and stability in the sector.