Lower oil prices put brakes on deep-water prospecting off the coast of Africa
The oil glut is depriving Africa of a growth driver
Drillers burned by a two-year slump in crude prices are slowing exploration of deep-water prospects off the coast of Africa, undermining a key driver of growth on the continent. In the 25 years since 1982, African oil output doubled to more than 10-million barrels a day. Now, with prices sitting below $50 a barrel, international drillers have cut their plans for capital spending in the next five years by $100bn, according to a November 2 report by Wood Mackenzie. The change could drop the region’s oil production 46% by 2030, the report said. Hardest hit: Nigeria and Angola, countries that are already struggling economically and depend on oil for almost all their foreign income. To revive deep-water exploration on the continent, crude prices would have to rise to $60 to $70 a barrel, according to Keith Myers, managing director of the consulting firm Richmond Energy Partners. "Africa suffered the most of any region in terms of the decline in frontier exploration," Myers said in an e-m...
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