In 2014 the oil and gas industry experienced a downturn and global crude oil prices dropped strongly – and then more recently the industry was again battered by the onset of the COVID-19 pandemic. But amidst these challenges (https://bit.ly/3oRIJw9), the MSGBC Basin countries have been an exception. According to seismic and geophysical mapping specialist firm TGS: “The MSGBC Basin has been the shining light of African exploration through the recent darkness the industry has endured. That light, or rather floodlight, was cast upon the region through the recent world-class discoveries in Senegal and Mauritania.”
These major exploration successes in the offshore waters of Senegal and Mauritania have served as catalyst driving interest and has led to a growing number of countries conducting seismic surveys and E&P activity, specifically The Gambia, Guinea Bissau and Guinea Conakry. TGS has been present (https://bit.ly/3lzjkoJ) in the MSGBC Basin since 2010, when they acquired a 3D dataset in The Gambia. Since then, their activity has grown substantially; TGS is currently conducting the Gambito 2020 3D seismic survey in the MSGBC basin offshore The Gambia. TGS´ acquisition is the latest development in The Gambia´s desire to explore offshore resources and build a significant energy economy. Furthermore, last year the government signed a contract with supermajor BP to explore oil and gas off its coast.
Other countries in the MSGBC region such as Guinea-Conakry (https://bit.ly/3oZ9lLA) are equally looking to highlight the potential of their natural resources. For instance, the creation of the Ministry of Hydrocarbons is in line with a strong governmental emphasis on hydrocarbons valorization. Guinea-Conakry’s Office National des Pétroles (https://bit.ly/3mKNNjc) is tasked with supporting the Ministry´s strategy by providing technical expertise on upstream and downstream operations. Guinea-Bissau is also working to actively carry out new E&P activity on a number of offshore blocks that are being operated by companies such as CNOOC and other medium sized IOCs in partnership with national oil company Petroguin E&P.
In addition to leading the MSGBC Basin countries in hydrocarbon development, Senegal has also emerged as a beacon in the development of ambitious renewable energy projects. Photovoltaic and wind energy projects are making a significant contribution towards diversifying the energy mix in Senegal and as much as 30% of the electricity produced in the country today comes from renewable energy sources. Landmark projects include the Taiba N´Diaye wind power facility operated by Lekela Power. The Project is designed to generate electricity for at least 20 years through its 46 wind turbines.
There are also excellent opportunities for undertaking renewable energy projects in Guinea-Bissau, Guinea-Conakry and The Gambia. For instance, The Gambia recently unveiled a €2.7 million project named Renewable Energy Potentials in The Gambia (REPGam). The initiative is being funded by the German Federal Ministry of Education and Research.
Guinea-Bissau is also particularly promising (https://bit.ly/3092SmT) for investment in solar power plants and hydroelectric power generation projects. Recently, China´s Sinohydro began the construction of one of the first large scale solar plants, with the purpose of selling power to the national utility EAGB, under a long-term contract, which will triple the national utility company´s power generation capacity.
Steadily Improving Investment Climate
In recent years all of the MSGBC Basin countries have been climbing up the global rankings due to the continuing improvements in their business climates as ranked by institutions such as the World Bank´s Ease of Doing Business (https://bit.ly/2X4BJQW), Transparency International, the Extractive Industry Transparency Initiative and The Heritage Foundation. Senegal is the top ranked coming in at 123 out of 190 countries, followed by Mauritania at 153, The Gambia at 155, Guinea-Conakry at 156, and Guinea-Bissau at 174. Although there is room for improvement, as with any emerging market economy, the overall trend is positive and these countries regularly work with the International Monetary Fund, The World Bank, development partners and the international donor community to continue building stronger institutions and promote greater transparency in each country.
Political Stability and Security
In contrast to many of the countries in the Sahel region that have fairly constant security problems caused by extremist groups, or others in Central Africa and the Great Lakes Region, the MSGBC countries as a whole benefit from a great deal of political stability and the absence of either civil wars or significant armed insurgencies. Security and stability are of paramount importance for international investors.
Countries such as Senegal, in particular, play a strategic role as a buffer zone from what security analysts typically refer to as ‘the arc of instability’ that spreads through large parts of the Sahel and certain North African countries.
To date, Senegal continues to have agreements with several European and NATO member countries who have military advisors in the country and help train Senegalese troops and security personnel. In turn, Senegalese soldiers contribute regularly to United Nations peacekeeping missions both regionally and internationally, and they are considered to be some of the best-trained, and most professional soldiers anywhere in sub-Saharan Africa. Furthermore, many of the capitals of MSGBC Basin countries like Dakar, Banjul or Nouakchott have very low levels of violent crime thanks to a strong police presence that serves as a powerful deterrent against criminals. Finally, the MSGBC Basin countries benefit from a consolidated democratic tradition where peaceful transfers of power are the norm, and not the exception.
The discovery of oil and gas and the development of the petroleum sector currently underway throughout the MSGBC Basin countries is a brand-new sector. But long prior to its advent, many of these countries had well developed industries such mining for bauxite in Guinea-Bissau, or prospecting for gold, nickel and phosphates in both Senegal and Mauritania. The Gambia and Senegal have a wealth of highly attractive tourism attractions on the beautiful beaches of their Atlantic coastline. There are many high-end and more moderately priced accommodation options to discover the varied and vibrant cultural heritage and gastronomy of cities like Dakar, Banjul, Nouakchott, Conakry, and Bissau. Therefore, although a large proportion of new FDI into the MSGBC region is currently going into oil and gas and renewable energy projects; potential investors can also contribute towards the economic diversification strategies underway in each of these countries and find world-class partners in a wide range of industries like tourism. For those interested in adventure travel and unique experiences; desert safaris and camel rides await them in Mauritania. Senegal´s Pink Lake, the Colonial architecture of Saint Louis, or cruises up the Podor River are remarkable for their natural beauty and the unique biodiversity of these countries. Regardless of how the energy sector evolves in the near future, the hospitality and warmth of the people of MSGBC region will continue to be a major draw for years to come.
In response to growing demand for renewable power, and increasing interest by international stakeholders to invest, develop, and succeed in Africa, Energy Capital&Power will hold the MSGBC Oil, Gas,&Power (https://bit.ly/3mMIxLV) 2021 conference and exhibition on the 2-3 December 2021. Focused on enhancing regional partnerships, spurring investment and development in the oil, gas and power sectors, the conference will unite regional international stakeholders with African opportunities, serving as a growth-oriented platform for Africa’s energy sector. Find out more about the conference here: The Energy Minute: MSGBC Oil, Gas&Power 2021 (https://bit.ly/2YQGhex)Distributed by APO Group on behalf of Energy Capital&Power.
© Press Release 2021