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Why The West African Oil Boom Ended So Abruptly

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Global oil production is slowly recovering towards pre-Covid-19 levels, but in West Africa the pandemic is set to leave lasting effects. This important region for sweet crude oil production faces numerous challenges as it strives to heal from the pandemic, including underinvestment, a lack of infill drilling at mature fields, and infrastructure that is either aging or threatened, a Rystad Energy analysis showed.

Sweet crude is the preferred oil grade to make jet fuel – the worst-hit segment as oil demand plunged last year. West African crude oil production dropped to 3.71 million barrels per day (bpd) last year from 4.12 million bpd in 2019, and is set to decline further to 3.39 million bpd this year. While we expect output to tick back up in 2022 and 2023 as jet fuel demand returns, production is set to fall below 3 million bpd already from 2025 unless heavyweights Nigeria and Angola can stage a strong comeback and shake off the dismal growth trends of the past decade.

West Africa’s oil production was not destined to follow this current grim projection before Covid-19 hit – in fact, the region was in line for more investment and activity. Last year’s low oil prices and the unstable market conditions that have continued into 2021 changed the outlook, however, as major operators decided to practice capital discipline and limit their investment exposure in regions including West Africa.

As a result, Rystad Energy has reduced its forecast for West African crude oil output by 600,000 bpd for 2021 and by 650,000 bpd for 2026, compared with our pre-Covid-19 projections.

“The structural upstream obstacles that West Africa faces are realities that are not going away in the short term. Even if jet fuel makes a spectacular recovery and demand for light and medium sweet crude grades returns, Nigeria and Angola, as well as other neighbors in structural upstream decline, will not be in a position to supply the market,” says Nishant Bhushan, upstream analyst at Rystad Energy.

The region’s decline in 2021 is driven by its two biggest oil producers, Nigeria and Angola, which together are estimated to have lost 440,000 bpd versus the pre-Covid-19 forecast. We also estimate that crude oil production has dropped significantly in countries such as Congo, Gabon, and Equatorial Guinea, which together produced between 250,000 bpd and 300,000 bpd in 2010. Equatorial Guinea has seen a 60% reduction in oil production and Gabon nearly 35% in the past 11 years.

Crude oil production from West African countries was expected to pick up pace in tandem with their Middle Eastern counterparts as the OPEC+ group opened its supply taps. But even as OPEC+ production caps have gradually eased, Nigeria and Angola have not been able to ramp back up to their pre-shut-in production levels.

Crude production is not the only thing that’s been hit in the past couple of years. Since the start of 2020, we have also seen that the overall crude production capacity in Nigeria and Angola has taken a major blow. This is due to a number of reasons, including rapid declines at mature fields due to a lack of infill drilling, postponement of final investment decisions that were originally planned for 2020 and 2021, a lack of investment in oil and pipeline infrastructure which leads to frequent production shut-ins (prevalent in Nigeria), and civil unrest caused by militia groups.

West Africa has never had much unused capacity – most countries have produced at maximum capacity even as that capacity was gradually declining. When OPEC+ unveiled its massive 9.8 million bpd cut program in May 2020, the region had an overall oil production capacity of 4.2 million bpd. We estimate this has dropped by almost 420,000 bpd to around 3.8 million bpd by the end of 2021, and will keep shrinking to 3.5-3.6 million bpd by the end of next year.

Nigeria

Nigeria produces sweet crude grades ranging from light to heavy, but most of the volumes fall into medium to light grades. We expect the output of all sweet crude grades in Nigeria will decrease on the back of declining production from mature fields. The major drop in crude oil production is in grades like Bonga, Egina, and Qua IBoe, which are estimated to fall collectively by 180,000 bpd to 200,000 bpd by 2026 from 2021. Other crude grades, like Forcados, Bonny Light, Escravos, and Erha, are estimated to remain little changed, while some growth will be seen in crude grades like Amenam, Brass River, and Jonas Creek.

The decline in Nigeria’s crude oil production in recent years looks more structural as the country has failed to attract new investments in its oil and gas industry, be it in exploration, greenfield developments, or brownfield expansions. In the short term, we estimate Nigeria’s crude oil production will rise to about 1.55 million bpd in 2022 and 1.58 million bpd in 2023, with some new marginal field developments adding 30,000-35,000 bpd in 2022 and another 35,000-40,000 bpd in 2023. At the same time, some fields currently in the ramp-up phase are estimated to add 65,000-70,000 bpd in 2022, but only 10,000-15,000 bpd in 2023. After 2023, we estimate Nigeria’s output will continue to slide due to a lack of significant new discoveries, slipping to as low as 1.25 million bpd by 2026.

Angola

Like Nigeria, Angola’s decline in crude oil production is also structural, and production has been plummeting since 2015 – from 1.74 million bpd in 2015 to almost 1.11 million bpd in 2021. This output slump is the direct result of a lack of new investments in exploration and a failure by operators to halt the production decline at mature oil fields. New upstream projects are estimated to add 40,000-45,000 bpd this year and another 80,000-90,000 bpd in 2022, but this will not be enough to halt the downward spiral that will reduce Angola’s crude oil production to between 750,000 bpd and 800,000 bpd by 2026.

Angola mostly produces sweet crude, and we expect production of all the major sweet crude grades to slide in the coming years. We see overall sweet to regular crude grade output slumping by almost 300,000 bpd from 2021 to 2026 – a drop of about 30%. Major crude grades such as Nemba, Dalia, Mostarda, Gindungo, Girassol, and Kissanje are estimated to cumulatively decline by 280,000-300,000 bpd in 2026 from 2021. Some smaller crude grades like Sangos, Saturno, Cabinda, and Plutonio are estimated to remain at similar levels or inch up by 15,000-20,000 bpd combined.

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US senator urges Kenyan president to aid peaceful transition

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NAIROBI, Kenya (AP) — A visiting U.S. senator says he has encouraged Kenya’s outgoing president to participate in a “peaceful transition of power” amid the latest election crisis in East Africa’s most stable democracy.

“I’ll let the president speak for himself, but that was certainly a hope I expressed today,” Sen. Chris Coons told The Associated Press after his meeting with President Uhuru Kenyatta on Thursday. He said they discussed ways in which Kenyatta can play a “constructive peacemaking role” after leaving office.

Kenyatta has remained publicly silent since the Aug. 9 vote, adding to the anxiety as Kenya again faces post-election uncertainty and a likely court challenge by the losing candidate, Raila Odinga. Coons, leading a congressional delegation on a five-country Africa visit, was in Kenya in part to meet the key parties and urge that calm continue.

Sen. Chris Coons, second right, leading a U.S. congressional delegation, is accompanied by his wife Annie Coons, right, and Rep Dave Joyce, left, as he speaks to patient David Oduor, center, at his home, after visiting the Tabitha Medical Clinic run by CFK Africa in the Kibera neighborhood of Nairobi, Kenya Thursday, Aug. 18, 2022. The delegation also met with current President Uhuru Kenyatta, Kenya’s new president-elect William Ruto, and opposition figure Raila Odinga who has said he will challenge his recent election loss in court. (AP Photo/Ben Curtis)

Kenyatta had backed longtime rival and opposition leader Odinga in the close race against his own deputy president, William Ruto, who fell out bitterly with Kenyatta years ago. Ruto on Monday was declared the winner, but not before Kenya’s most peaceful election ever slid into chaos in the final moments.

The electoral commission split in two, each side accusing the other of trying to tinker with the results. It came as a shock to many Kenyans after an election widely seen as the country’s most transparent ever, with results from the more than 46,000 polling stations posted online.

Now Odinga almost certainly will challenge the results in Supreme Court. His campaign has seven days from Monday’s declaration to do so, and the court will have 14 days to rule. Odinga has urged supporters to remain patient instead of taking to the streets in a country with a history of sometimes deadly post-election violence.

After meeting with Kenyatta, Odinga and Ruto, Coons told the AP “I was encouraged that in all three meetings we heard a commitment to a call for calm and tranquility, to respect the legal processes established in the 2010 constitution.” He said the conversations were about the rule of law, the importance of free and fair elections and peaceful transitions.

“Obviously, the United States has had a very difficult experience with these issues for the past few years,” Coons said, referring to the Jan. 6, 2021, attack on the U.S. Capitol as former President Donald Trump tried to remain in power. “I said in all three meetings we have things to learn from Kenya.”

Kenyatta told Coons that Kenya would uphold “its position of a shining example of democracy in the continent by maintaining peace during this transition period,” according to a statement issued by the president’s office.

Coons said he did not come to Kenya seeking anything like the handshake that Kenyatta and Odinga, after prodding, famously shared to end months of crisis after the 2017 election, whose results were overturned by the Supreme Court over irregularities, a first in Africa. Odinga boycotted the fresh vote and declared himself the “people’s president,” bringing allegations of treason.

This time, with Kenyatta’s backing, the Odinga campaign felt he would win the presidency after a quarter-century of pursuing it.

Kenyatta is stepping down after two terms, itself a notable act in a region where longtime presidents like Yoweri Museveni of Uganda and Paul Kagame of Rwanda have been accused of clinging to power through changes in term limits, manipulation of elections and crackdowns on dissenting voices.

The U.S. delegation is also visiting Rwanda, where human rights and violent tensions with neighboring Congo are almost certainly on the agenda following Secretary of State Antony Blinken’s visit there last week. Coons said he looks forward to visiting again with Kagame.

Kenyatta has played a leading role in efforts to calm the Rwanda-Congo tensions and in trying to mediate in neighboring Ethiopia’s deadly Tigray conflict, with support from the U.S. Coons did not say what kind of peacemaking role he hoped to see Kenyatta play after stepping down.

Ruto’s public comments this week have been on domestic matters, not foreign, but Coons said the president-elect made an “expression of concern and intent in trying to help lead to positive resolutions” in such regional crises.

Coons also has played a role in trying to calm the Ethiopia conflict. But he told the AP the delegation was not having a meeting with Ethiopia’s government or the Tigray forces while in Kenya.

Coons, a member of the Senate Committee on Foreign Relations, and his delegation have already visited Cape Verde and Mozambique and will visit Tunisia as well.

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How thousands of freed Black Americans were relocated to West Africa

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In the 1800s, the American Colonization Society relocated thousands of freed Black Americans to West Africa. It led to the creation of Liberia.

  • The American Colonization Society’s mission was to relocate freed Black Americans to Africa.
  • Starting in 1820, thousands of Black emigrants were shipped to what would become Liberia.
  • The society’s segregationist ideology has a lasting impact on America and Liberia.

On December 21, 1816, a group of fifty white elites gathered in a Washington, D.C. hotel to discuss the future of freed Black Americans.

Following the American Revolution, the number of freed Black Americans had grown from 60,000 in 1790 to 300,000 by 1830. The American Colonization Society emerged as the solution, with the mission of shipping Black people to a colony in Africa.

African Americans depart for Liberia, 1896.

African Americans depart for Liberia, 1896. The American Colonization Society sent its last emigrants to Liberia in 1904.Digital Collections, The New York Public Library

The organization was the brainchild of the Reverend Robert Finley, a Presbyterian minister from New Jersey. The ACS’ early supporters included some of the nation’s most powerful and influential men, including Henry Clay, Daniel Webster, and Francis Scott Key, as well as slave-owning US presidents Thomas Jefferson, James Monroe, and James Madison.

“Can there be a nobler cause than that which, while it proposes to rid our country of a useless and pernicious, if not a dangerous portion of our population, contemplates the spreading of the arts of civilized life?” Clay said in his opening address.

Membership certificate of Rev. Samuel Rose Ely, dated March 1840. The Society’s president Henry Clay’s signature is visible at the bottom right.Library of Virginia

Colonization, the state-sponsored emigration and resettlement of freed Black Americans outside America, was widely supported in the US for religious, economic, and social reasons. Even after its dissolution in 1964, the ACS has left a lasting legacy of segregationist sentiment in both America and abroad, according to historians.

“The establishment of the American Colonization Society was a watershed moment in American history,” Eric Burin, a history professor at the University of North Dakota, said. “What you have is a powerful white organization propounding a vision of America as a white person’s country, and African Americans responding with a resounding rebuttal that it’s their country, too.”

A ‘miserable mockery’

The ACS attracted a diverse crowd of white individuals, including slaveholders who saw colonization as a way to remove freed Blacks, whom they feared would cause chaos by helping their slaves escape or rebel.

Many white Americans also believed that African Americans were inferior, and should be relocated to a place where they could live in peace away from the shackles of slavery. Abraham Lincoln held this belief, which led him to support a plan to relocate 5,000 Black Americans to the Caribbean in the 1860s.

The ACS also had a religious mission of Christianizing Africa to “civilize” the continent, according to historian Marc Leepson.

The initial reactions of the Black American community and abolitionists were nuanced. Some activists, like James Fortein, immediately rejected the ACS, writing in 1817 that “we have no wish to separate from our present homes for any purpose whatever”.

But some other Black abolitionists were cautiously interested in the notion of an emigration program. Martin Delany, who was dismissed from Harvard Medical School after white students petitioned against the inclusion of Black students, claimed that even abolitionists would never accept Black Americans as equals, and so the solution lay in the emigration of all Black Americans.

“We are a nation within a nation,” Delany wrote. “We must go from among our oppressors.”

But even Delany ultimately condemned the ACS’s hallmark plan to send Black Americans to Liberia, decrying it as a “miserable mockery” of an independent republic.

It led to the creation of Liberia

As the ACS grew, it sought to create a colony in West Africa. On February 6, 1820, 86 freed Black Americans set sail to the continent.

Map of Liberia, 1850.

An 1850 map of Liberia. Pencil annotations were made to change the report to “by the American Colonization Society,” and to add place names.American Colonization Society/Library of Congress

The initial expedition — and the expeditions that followed — proved to be disastrous as disease and famine struck. Of the more than 4,500 emigrants who arrived in Liberia between 1820 and 1843, only 40% were alive by 1843.

But the ACS, backed by funding from state and federal governments, continued to send more freed Blacks. In 1821, the society purchased Cape Mesurado from the indigenous people — by threatening the use of force, according to some accounts.

The land surrounding Cape Montserrado would later be known as Liberia, “the free land.” Its capital was renamed Monrovia in honor of James Monroe, an ardent supporter of the ACS.

The settlers developed an Americo-Liberian society that was strongly influenced by their roots in the American South, according to Burin. Americo-Liberians wielded vast socioeconomic and political power over the indigenous people — which planted the seeds for the Liberian Civil War of 1989.

“The Americo-Liberians realized they could essentially exploit the indigenous people for labor,” Burin told Insider. But it was a way for indigenous people to gain access to resources and education as well.

A lasting legacy of segregationist sentiment

Though the ACS eventually dissolved in 1964 after continuous opposition from abolitionists and a lack of interest by free Black Americans, historians said it shaped — and continues to shape — the country’s discussions of race.

“One of the ACS’ lasting legacies was the underlying ideology that drove the colonization movement forward: that Black people really aren’t Americans, at least not in the way that white people are,” Burin said.

The sentiment manifested itself in policies like Jim Crow-era segregation, and still has a grip on some Americans to this day.

A photo of children in Liberia, taken during an ACS mission trip in 1900.American Colonization Society Collection/Library of Congress via Getty Images

The second legacy of the ACS is Liberia itself. In 1847, Liberians declared the country an independent nation, becoming the second Black republic in the Atlantic after Haiti.

“The ACS founded a country that has had a distinctive influence over debates of freedom, slavery, and race today,” Burin said.

♦ Culled from the Insider

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OMG: 20-Year-Old Woman To Be Stoned To Death For Cheating On Her Husband

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A 20-year-old Sudanese woman has been reportedly sentenced to death by stoning after being convicted of adultery. Police arrested Maryam Alsyed Tiyrab in Sudan’s White Nile state in June. She was found guilty of adultery by a court on June 26.

Human rights activists continue to fight against the penalty as it violates domestic and international law. “The application of the death penalty by stoning for the crime of adultery is a grave violation of international law, including the right to life and the prohibition of torture and cruel, inhuman or degrading treatment or punishment,” said The African Center for Justice and Peace Studies (ACJPS), based in Uganda. They added how Tiyrab was not given a fair trial and was not informed that the details she gave during interrogation would be used against her. Additionally, she was denied access to a lawyer.

Many groups and activists in Africa fear that the sentence of stoning marks the government’s attempts to roll back women’s rights. “The death by stoning case is a reminder that the criminal law reforms during the transition [government] were not complete, and that such harsh, archaic punishments are still officially on the books,” human rights lawyer Jehanne Henry said. She also added that the sentence “shows that harsh Sharia laws [and] penalties are still being implemented in Sudan.” Human rights groups are protesting for Tiyrab’s immediate release.

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