Industry

The agreement also stretches the concession life by up to 20 years.

The Minister of Petroleum and Mineral Resources has signed the consolidated and amended concession agreement, officiating Capricorn Energy's rights over its existing Egyptian Western Desert concession agreements in which it has a 50% participating interest held jointly with Cheiron Oil and Gas Limited

With the Minister’s signature, the new agreement has taken effect for operations to start from 1 July 2025, from which date the merged concession terms became applicable and Capricorn’s work programme obligations commenced.

The agreement also stretches the concession life by up to 20 years with a 10-year development term and two five-year optional extension terms. It comes with amended fiscal terms to promote investment, and merges the existing concessions to increase operational and financial efficiencies.

Randy Neely, chief executive, Capricorn Energy, said, "We are delighted to have received the final signed approval for our consolidation agreement from Minister Badawi. We appreciate EGPC and our operating partner, Cheiron, for their collaboration throughout this process and look forward to working together under the improved terms." 

Earlier in the year, Capricorn had reported liquids-rich development drilling from the Badr El Din (BED) concession. A waterflood programme initiated in the field resulted in increased production levels from Egypt for Capricorn Energy's 2025 report at 20,024 barrels of oil equivalent per day, surpassing the year's guidance of 17000-21000 bopd. 

The UAE’s exit introduces new uncertainties for Africa.

While the recent withdrawal of the United Arab Emirates from OPEC reflects longstanding tensions over production quotas and strategic direction, its implications extend far beyond the Gulf

For Africa — a continent with both major producers and heavily import dependent economies — the UAE’s exit introduces new uncertainties into an already fragile energy landscape.

Why the UAE left OPEC: The structural tensions

The UAE’s departure did not emerge in a vacuum. Several structural pressures have been building over the past decade:

• Quota rigidity: The UAE has repeatedly argued that its growing production capacity is not reflected in OPEC quotas.

• Divergence from Saudi Arabia: While Riyadh prioritises price stability, Abu Dhabi has increasingly favoured higher output and market share.

• Long-term strategy: The UAE is investing heavily in upstream expansion and wants the freedom to monetise reserves before global demand plateaus.

• Frustration with OPEC+ constraints: The post 2020 production management framework has been a source of friction.

The UAE’s exit signals a recalibration of its national energy strategy — and a potential weakening of OPEC’s cohesion.

Africa’s exposure

Africa’s relationship with OPEC is complex. Some states are members, others have withdrawn, and many rely on OPEC-driven price stability despite not being producers.

The UAE’s exit affects each differently.

OPEC member countries

Nigeria 

Africa’s largest oil producer faces chronic underproduction relative to its OPEC quota. A weaker OPEC could mean:

• Greater price volatility

• Reduced collective ability to stabilise markets

• Increased pressure on Nigeria’s fiscal planning

Nigeria’s dependence on oil revenue makes it highly sensitive to any erosion of OPEC’s influence.

Angola 

Angola withdrew from OPEC in 2023, citing quota constraints that limited its production ambitions. The UAE’s exit validates Angola’s concerns and may encourage other producers to question the value of membership. Angola, however, remains exposed to global price swings, and reduced OPEC cohesion could amplify volatility.

Algeria

A long-standing OPEC loyalist, Algeria relies on the organisation’s collective discipline to maintain price floors. The UAE’s departure weakens Algeria’s diplomatic leverage and may complicate its efforts to stabilise domestic energy revenues.

Libya

Although exempt from quotas due to conflict, Libya is highly vulnerable to price instability. The UAE’s exit increases uncertainty in global markets, complicating Libya’s recovery planning and investment climate.

Equatorial Guinea, Congo, Gabon

These smaller producers have limited buffers and depend heavily on OPEC’s collective bargaining power. A weakened OPEC reduces their ability to influence global markets and exposes them to sharper price cycles.

Non OPEC member countries engaged in production and refinery

Egypt 

Egypt is a net importer of crude. Its refining sector and domestic energy pricing are sensitive to global price movements. Increased volatility could:

• Raise import costs

• Strain fiscal budgets

• Affect electricity and transport pricing

Egypt’s exposure is indirect but significant.

Sudan and South Sudan

South Sudan depends on oil for the majority of its national revenue, exporting through Sudanese pipelines. Both states rely on predictable global prices to maintain budget stability. Increased volatility could:

• Disrupt pipeline fee arrangements

• Reduce government revenue

• Complicate debt and fiscal planning

Their vulnerability is structural and immediate.

South Africa

South Africa’s closure of its refineries and conversions to import terminals made it a major importer of refined petroleum products and relies heavily on global price stability. The UAE’s withdrawal from OPEC could increase price volatility, affecting transport, electricity generation and industrial production. With several refineries shut down or converted to import terminals, South Africa’s exposure to global price swings is significant.

Mozambique

Mozambique is emerging as a major gas producer but remains a net importer of refined petroleum products. LNG projects depend on stable global markets and investor confidence. Increased volatility could affect project timelines, financing and long term offtake agreements.

Namibia

Namibia is on the verge of becoming a major oil producer following recent offshore discoveries. For now, it remains import dependent. Price volatility affects domestic markets, but long term, a weakened OPEC could influence Namibia’s future production strategy and investment climate.

Ghana

Ghana is both a producer and importer of refined products. Price volatility affects fiscal planning, refinery economics, and the viability of offshore projects. A weaker OPEC could complicate Ghana’s long term revenue projections and investment climate.

Democratic Republic of Congo 

The DRC is a small producer but a major importer of refined products. Price instability affects mining operations, transport and electricity. The DRC’s exposure is indirect but significant due to its reliance on imported fuels and its large industrial sector.

Import-dependent African economies

A significant number of African states rely heavily on imported petroleum products and are therefore highly sensitive to global price movements. For these economies, OPEC’s cohesion matters because it stabilises international markets and reduces volatility. The UAE’s withdrawal introduces uncertainty that could affect inflation, transport costs, electricity pricing and fiscal planning.

This group includes:

• Kenya, Tanzania, Uganda, Burundi, Rwanda - East African economies with growing energy demand and limited refining capacity.

• Senegal, Morocco, Tunisia - North and West African importers exposed to global price cycles.

• Zimbabwe, Malawi, Zambia - landlocked states dependent on regional supply chains through South Africa, Mozambique and Tanzania.

• Ethiopia and Somalia - fully import-dependent economies where fuel prices directly affect food security and transport.

• Botswana and Namibia - reliant on South African and regional supply routes, with limited domestic buffers.

For these countries, a fractured OPEC could mean:

• Higher inflation driven by fuel and transport costs

• Increased food prices due to supply chain exposure

• Pressure on foreign exchange reserves

• Greater fiscal strain on subsidy dependent economies

• Higher electricity generation costs in diesel reliant grids

These states are indirect but significant stakeholders in OPEC stability, and any weakening of OPEC's price management capacity will be felt across their economies.

Continental level risks for Africa

The UAE’s withdrawal introduces several systemic risks:

• Increased price volatility as market coordination weakens

• Reduced OPEC influence, lowering the organisation’s ability to maintain price floors

• More aggressive production competition among producers

• Investor hesitation due to uncertainty in long-term price signals

• Refinery project uncertainty, especially for new African mega refineries

• Fiscal instability for oil dependent economies

Africa’s exposure is both direct (for producers) and indirect (for importers).

Strategic options for Africa

Africa cannot control OPEC dynamics, but it can strengthen its resilience.

To reduce dependence on external market governance, institutions such as the African Petroleum Producers’ Organisation (APPO), African Union and Afreximbank can facilitate:

• regional production alignment

• joint investment frameworks

• coordinated policy responses

Acceleration of refinery expansion and integration can reduce dependence on external market governance. The following projects can bring down import dependence and stabilise domestic markets:

• Dangote Refinery (Nigeria)

• Cabinda Refinery (Angola)

• Uganda’s planned refinery

• Egypt’s ongoing expansions

To avoid the vulnerability of OPEC centric pricing cycles, African producers can diversify export markets and strengthen ties with:

• Asia

• BRICS +

• Regional African markets

Africa can build fiscal buffers such as sovereign wealth funds, stabilisation funds and hedging strategies to help governments absorb price shocks. It can also strengthen local content and value chains so that increased domestic value capture reduces vulnerability to external volatility and support long-term industrialisation.

Africa must not be a passive price taker. The UAE’s withdrawal from OPEC is a reminder that global oil governance is shifting. Africa cannot afford to be reactive. By strengthening regional coordination, accelerating refinery development, diversifying markets, and building fiscal resilience, African states can navigate this transition with greater stability and strategic autonomy.

The article has been written by Elijah Paul RukidiMpuuga, FCIArb (UK), founder and principal, Equitas Dispute Resolution Group, LLC

SNH’s licensing initiative aligns with Cameroon’s broader strategy to optimise hydrocarbon resources.

Five out of nine blocks launched during Société Nationale des Hydrocarbures' (SNH) 2025 licensing round have been offered to winning bidders for production sharing contract negotiations in Cameroon

SNH has confirmed that Octavia Energy Corporation has been awarded the Bolongo Exploration block in the Rio del Rey Basin, while Murphy West Africa secured four blocks in the offshore Douala/Kribi-Campo area: Etinde Exploration, Tilapia, Elombo and Ntem. The remaining blocks – Ndian River, Bakassi, Bomono and Kombe-Nsepe – remain part of the broader licensing round framework following the current phase of evaluation.

Reflecting boosted demand for offshore exploration and brownfield development, Cameroon is the latest in a number of African countries such as Libya or Sierra Leone among others who have recently announced licensing rounds. These fresh licensing rounds are distinguished in their structured, investment-driven approach to re-engage international operators and unlocking underexplored acreage. Cameroon's latest licensing round, in particular, is in line with its strategy of productoion optimisation to address declining output from mature fields, and attract capital and technical expertise to support renewed exploration activity.

The Douala/Kribi-Campo area, where Murphy West Africa will focus its activities, is widely regarded as a highly prospective offshore petroleum province within Cameroon’s broader coastal basin system, with notable gas potential despite being less explored than the Rio del Rey Basin. Meanwhile, the Rio del Rey Basin – home to Octavia’s Bolongo block – remains an established production area with opportunities for redevelopment and enhanced recovery.

SNH’s licensing initiative aligns with Cameroon’s broader strategy of resources optimisation, output stabilisation from declining fields, and attract capital and technical expertise to support renewed exploration activity. This comes amid gradual production declines across legacy assets, reinforcing interest in both offshore gas development and incremental oil recovery opportunities.

At the same time, Cameroon is seeking to strengthen gas monetization pathways and expand domestic energy supply, with growing emphasis on gas-to-power development and broader industrial applications. This strategy is closely linked to LNG development, downstream gas processing and infrastructure expansion – particularly around Kribi – which is expected to support the development of integrated gas value chains. Planned pipeline projects, port upgrades and industrial gas-to-power initiatives are also expected to reinforce midstream and downstream capacity while improving monetization of domestic resources.

Collaboration in research and development is of strategic importance. (Image source: NNPC Limited)

NNPC Limited has signed a memorandum of understanding (MoU) with the Algerian National Oil Company, Sonatrach, to advance partnership opportunities in research, development and innovation

The MoU with Sonatrach will be led by NNPC's Research Technology and Innovation (RTI) Division, in collaboration with the Petroleum Technology Development Fund (PTDF). The agreement framework was signed by NNPC's executive vice president - business services, Sophia Mbakwe, and Sonatrach's managing director, Khodjah Mohamed, during the latest African Petroleum Producers' Organisation (APPO) Forum for R&D Directors at the PTDF Tower in Abuja, Nigeria. 

While speaking of the significant players in advancing Africa's hydrocarbons sector, the Minister of State for Petroleum Resources (Oil), Senator Heineken Lokpobiri explained that the forum originated as a platform for navigating the global energy transition by leveraging funding, technology, and markets, and said, "The R&D forum tackles technology and expertise needs, the African Energy Bank addresses funding constraints, and the Central African Pipeline System supports regional oil and gas market integration."

"Collaboration in research and development is of strategic importance. The cost of innovation might be high, but the cost of obsolescence would be greater," said NNPC's chief financial officer, Adedapo Segun.

The Group chief executive officer of NNPC, Bashir Bayo Ojulari, fosters a vision for a unified strategic framework through which resources could be pooled, data integrated and risks shared across member countries. He also stressed on the rapid adoption of digital technologies, artificial intelligence and advanced engineering to improve upstream, midstream and downstream operations.

The APPO secretary general, Farid Ghezali, urged African petroleum producing countries to ensure research in the oil and gas sector produced solutions that are practical and directly relevant to the continent. "We must ensure that our research delivers solutions that are practical and of direct use to Africa," he said.