The United States Positioned for Leading Role in Africa’s LNG and FLNG Growth
By Amanda Roberts
The United States is in a prime position to drive the expansion of liquefied natural gas (LNG) and floating liquefied natural gas (FLNG) projects in Africa, with projections indicating a significant growth in the floating LNG market by 2027. This presents a unique opportunity for U.S. operators and contractors to actively participate in the development of new capacity in collaboration with onshore projects.
Invest in African Energy Forum
Energy Capital & Power is hosting the upcoming Invest in African Energy (IAE) forum in Paris on May 14-15. The forum aims to provide a platform for U.S. companies to explore trade, partnership, and investment opportunities across Africa’s energy supply chain. By showcasing projects from various regions of the continent, the event seeks to establish regional gas markets in Africa and capitalize on the growing interest of U.S. companies in African energy ventures.
LNG Investment Avenue
As Africa continues to focus on developing its gas reserves for domestic use and exports, the U.S. is well-suited to capitalize on LNG investments alongside traditional oil exploration. With projections indicating significant investment opportunities in world-class LNG projects in Mozambique and FLNG projects in multiple African countries, there is immense potential for U.S. investors, operators, project developers, and service providers to engage in the African energy sector.
Growing FLNG Market
While American companies are already prominent players in Africa’s LNG sector, Energy Capital & Power notes that there is room for expansion, particularly in the FLNG segment. FLNG offers greater flexibility, faster time to market, and is suitable for smaller gas reserves. Research by Westwood Global Energy suggests that the global FLNG market is expected to attract $35 billion in investments by 2027, leading to an additional 18.3 million tons per annum of capacity.
Future Capacity Boosts
With Africa taking the lead in short-term investments, an expected increase in LNG capacity will generate significant engineering, procurement, and construction (EPC) contract values. Projects set for development beyond 2027 are projected to contribute an additional 36.5 million tons per annum of capacity, with an estimated EPC value of $22 billion. The IAE forum will provide a platform for discussing these upcoming projects and the companies driving capacity expansions.
Equatorial Guinea’s Gas Mega Hub
U.S. operators and contractors are actively involved in Equatorial Guinea’s Gas Mega Hub project, which aims to unlock stranded gas fields in the Gulf of Guinea for an intra-African LNG trade. Chevron’s Noble Energy E.G. has taken the lead in the initial phases of the project, with plans to develop subsequent phases in collaboration with Marathon Oil and the Equatorial Guinea government. Energy Capital & Power believes that the GMH project could set the stage for the construction of West Africa’s first LNG storage and regasification plant.
In Conclusion
The United States is at the forefront of Africa’s LNG and FLNG expansion, positioning itself as a key player in the continent’s energy sector. With significant investment opportunities on the horizon and a growing interest from U.S. companies, the future looks promising for collaborations between the U.S. and African energy markets.