Arrested development in Africa
Africa will experience deep cuts and long delays to discretionary capex. But preparatory work continues for when the market recovers
The retrenchment of the oil and gas industry will be felt severely in Africa. Global capex cuts, perhaps averaging one-third, will fall disproportionately on the continent and NOCs will be in no position to make up the shortfall. The pain will not be spread evenly. Developments requiring capex will be hardest hit. Operationally “all new projects are frozen”, according to a banker at a multilateral institution who spoke to Petroleum Economist. Exporters will also be harder hit than those supplying power generation in domestic markets. While majors have been quick to reassure investors with massive headline cost-cutting figures—such as 25pc for Italy’s Eni and BP—in such a fluid environment, t
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