Johannesburg - Africa's oil and gas sector shows growth despite regulatory uncertainty and corruption, according to a report released on Wednesday.
“As a result of numerous challenges in the market, meticulous planning is required,” PwC Africa Oil & Gas advisory leader Chris Bredenhann said at the release of the report in Johannesburg.
The problems in the industry were fuelled by corruption, fraud, poor infrastructure, and lack of skills, he said.
The report titled “On the brink of a boom” analysed events in the past 12 months in the oil and gas industry across major African markets.
Bredenhann said despite the problems facing the industry, new hydrocarbons were developing at a significant pace.
“Large gas finds in Mozambique and Tanzania have caused the world to take note of east Africa as an emerging player in the industry,” he said.
The continent had eight percent of world oil reserves.
“Africa's consumption is at four percent, and is expected to increase by 50 percent over the next 20 years,” said Bredenhann.
A great deal of the continent's gas reserves are in north Africa.
Libya had the fifth-largest shale oil potential in the world with 26 billion barrels.
Algeria's shale gas potential was third in the world, while South Africa's was eighth.
In South Africa, shale gas is seen as a new player, said Bredenhann.
“The hype over shale gas in South Africa is accompanied by uncertainty over environmental impact, and we have government having a keen interest in the shale gas, but indicating that environmental issues should be resolved.” - Sapa