Geneva, 15 October 2014 (UNCTAD press release) - OilGasMines Special Event
Investment opportunities in Africa’s booming oil and gas services industry will be the focus of a special side event taking place during the UNCTAD World Investment Forum 2014 in Geneva.
UNCTAD’s annual African Oil, Gas, Minerals, Trade and Finance Conference (OILGASMINE), the first to be held outside Africa, takes place on 15-16 October and brings together ministers and high-level government representatives, senior executives and experts from the oil and gas industry.
Global annual revenues from oil and gas field services are estimated to be about $160 billion a year and are forecast to reach $213 billion by 2017. The growing oil and gas field services sector provides great potential for local communities to benefit in terms of job creation, increased incomes and improved related technical skills.
The OILGASMINE Conference will be opened by UNCTAD Secretary-General Mukhisa Kituyi. It will raise awareness of investment opportunities in the oil and gas services sector and highlight value added partnerships with host countries through case studies on Algeria, Kenya, Niger, Nigeria and Uganda. The Conference will also focus on policy options that increase benefits to recipient African countries from investments in oil and gas field services.
The worldwide oil and gas field services industry is largely dominated by foreign service providers, which have a large part of their business activities domiciled outside host countries. Even when services are performed in host countries there is low utilization of local service providers. Therefore it remains a major challenge to see to it that benefits from oil and gas field services trickle down to local communities.
In Africa, hydrocarbon resources are owned by Governments represented by their national oil companies. These companies enter into agreements with oil and gas service companies to develop and exploit the resources. This presents a win-win opportunity both for national oil companies to gain technical expertise and management skills and for service companies to expand their business.
Average annual capital and operational expenditure on procurement of capital goods, consumables and services by project operators in Africa is greater than total payments to Government. Oil and gas field services thus provide an attractive avenue for local players to get involved. Governments are improving the investment environment to attract investors into the sector, employing policy measures that encourage capacity-building and negotiating contracts with service providers that include transfer of technology and project management skills.
Currently, demand for energy sources is driving the growth of oil and gas field services, but this could reverse if the global economy slows down, credit markets weaken and hydrocarbon prices fall, making oil and gas field operations less profitable. Developing countries therefore need to be aware of these risks.
- Part 1 of OILGASMINE, taking place from 2.30 to 6 p.m. on 15 October, will be chaired by Fatima Haram Acyl, African Union Commissioner for Trade and Industry, Ethiopia.
- Part 2 of OILGASMINE, taking place from 10 a.m. to 1 p.m. on 16 October, will be chaired by Achille Bassilekin III, Assistant Secretary-General, in charge of Sustainable Economic Development and Trade, African, Caribbean and Pacific Group of States, Belgium.