Africa’s energy landscape is poised for significant transformation in the coming years, with the continent set to play a crucial role in global oil, gas, and renewable energy markets. According to a report seen by the Wall Africa Journal, investments in the sector are projected to grow, while challenges such as regulatory risks and security concerns persist.
Oil and Gas Prospects
Africa’s oil production is expected to rise modestly, increasing from 6.5 million barrels per day (bpd) currently to nearly 7 million bpd by the end of 2025. This growth is driven by stable output from key producers like Angola and Nigeria, as well as potential recovery in Sudan. However, the region’s full production capacity may remain underutilized due to infrastructure challenges and above-ground risks.
West Africa is anticipated to lead the continent’s oil supply, contributing around 3.8-3.9 million bpd by 2025, while North Africa’s steady production, supported by Algeria and Libya, will continue at approximately 3 million bpd. Offshore drilling activities are expected to remain significant, accounting for a substantial portion of production, particularly in Nigeria and Angola.
On the gas front, Africa is projected to maintain its contribution of around 6% to global supply. Liquefied Natural Gas (LNG) projects in Mozambique, Nigeria, and Senegal could enhance the continent’s export capabilities, but security concerns and financing hurdles pose potential delays. In a report seen by the Wall Africa Journal, experts highlight the importance of commercializing flared gas and advancing LNG projects to maximize revenue streams and reduce emissions.
Renewable Energy Expansion
The renewable energy sector is gaining momentum across Africa, with solar and wind installations expected to ramp up significantly by 2030. The report forecasts that renewables will constitute over 43% of Africa’s power generation mix by 2030, up from 27% today. North Africa is positioned to play a pivotal role, exporting green hydrogen and electricity to Europe through interconnectors.
Despite this progress, energy access remains a critical issue. More than half a billion Africans lack access to electricity, and the continent’s power generation mix is still dominated by fossil fuels. Decentralized energy systems, including solar home setups and mini-grids, are seen as key solutions to electrify rural areas.
Capital Expenditure and Investment Trends
Capital expenditure (capex) in Africa’s energy sector is projected to surge by 23% in 2024, reaching $47 billion, before slightly declining to $43 billion in 2025. By 2030, capex is expected to peak at $54 billion, driven by new projects and final investment decisions (FIDs). West Africa will dominate spending, accounting for over 50% of the continent’s cumulative investment through the decade.
While oil and liquid hydrocarbons will continue to attract the majority of investments, natural gas is gradually gaining traction, increasing its share of total expenditure from 30% in 2023 to over 40% by 2030. The report emphasizes the need for fiscal incentives and policy stability to attract further investments and realize Africa’s energy potential.
Challenges and Opportunities
Above-ground risks, including regulatory uncertainties, financing constraints, and security issues, remain significant barriers to maximizing Africa’s energy potential. However, strategic partnerships and advancements in technology offer opportunities to overcome these challenges. By leveraging its abundant natural resources and embracing sustainable practices, Africa could play a central role in the global energy transition.
This comprehensive outlook, based on insights from the State of African Energy 2025 report by African Energy Chamber, underscores the dynamic and evolving nature of Africa’s energy sector, highlighting both its immense potential and the hurdles it must address to achieve long-term growth and sustainability.