The COVID-19 pandemic and collapse inoil price has and still taking its toll on the oil and gas industry globally.This oil price saga has resulted in massive cuts in state budgets, publicspending, loss of contracts and employments. A lot of conversations have beengoing on in the oil industry. A set of people believe the ease of lockdown mayaccelerate the peak demand trajectory while another believe that oil demandwill struggle to regain an upward trajectory. Investments in the oil industryis expected to fall further such that supply shortages could eventually emerge.Ironically, despite enormous downsides to the pandemic, the climate andenvironment has seen better days. There has been reduced pollution from cars,airplanes and industries due to worldwide enforcement of lockdowns. This couldconvince most oil companies that wide adoption of electric vehicles may happenquicker than they expect.
Stricter regulation on emissionscould as well plunge down oil demand beginning from 2030 or 2035; thereby leadingto a rapid shift into renewable energy. It has been previously predicted by theInternational Energy Agency (EIA), that global oil demand which has risen by anaverage of 1.5m barrels per day (bpd) each year in the past decade to reach100m bpd in 2019 may start to witness slower growth from 2025. Many promisingexploration project prospects and drilling plans have been delayed and somesanctioned own to the oil crisis. African countries that are expected to beparticularly hard hit by such delays and uncertainties include Uganda, Ghana,Angola, Kenya and Nigeria. For instance, Tilenga project by Total in Uganda,Bonga Southwest Aparo field by Shell and the Etan and Zabazaba fields operatedby Eni in Nigeria. BP and Kosmos Energy’s Greater Tortue Ahmeyinm (GTA) LNGproject in Mauritania and Senegal; Exxon Mobil and Eni’s Rovuma LNG project inMozambique have all been postponed. Pecan Field development in Ghana has beenplaced on hold. Woodside Energy Sangomar Offshore Oil project in Senegal, whichhappen to be Senegal first oil venture was sanctioned. In the case of drillingprospects, Valaris drilling activities for Chevron in Angola, BW Energyoperations on the Dussafu Marin license in Gabon, exploratory drilling by FAR Limitedin Gambia, drilling works of Maersk in Ghana Jubilee and TEN fields have allbeen placed on hold. The Exxon Mobil ‘s offshore project in Guyana is alsoaffected, creating a potential delay in production start of up to 6 to 12months. The delay of theseexploration and drilling projects is expected to further impede discoveries ofnew fields and development.
The new norm (lifestyle) has forcedcompanies around the globe to rely on technology to stay on course. Some holdvirtual meetings while others monitor vital assets through it. It has earlierbeen projected that technological solutions will play an important role in the growthof Africa’s oil and gas industry, it is clear evident now that it is the way togo for new solutions for the entire globe. Technology will help African oil andgas companies to function more efficiently, thereby boosting profit share,which invariably will boost African nations economic growth. Thesetechnological advances could come off as; developing new ways to drill oilwells and handle rigging equipment, designing new seismic data collection codesand software, improvising newways to monitor petroleum data systems. Technological measures should be put inplace, such as use of machine learning and artificial intelligence to predictfuture problems and also generate possible solutions; simulation of drillingrigs and more intelligent completion to enhance production. Efforts should bemade to solve the recently encountered problems which include inadequatestorage capacity. Individual nations should see to development of storagecapacity both onshore and offshore. Oil and gas firms should collaborate more withlocal tech startups or firms to incorporate or set up these technologicalabilities. Once the market shows some signs of improvement and gain moreconfidence, partnerships should be fostered with investors who are willing totransfer new technology and modern day skills. For instance, in 2019, Angolabased Friburge oil and gas, a pan African mining service provider, with agrowing presence in the Sub-Saharan Africa partnered with internationaltechnology providers to drive innovation, efficiency and sustainable environment.More companies should look into this kind of partnership and take advantage of suchopportunities.
Climate change has received a wider global attentionin recent times own to the Climate strike action, which started 20 September,2019. The first protest which took place across 4500 locations in 150 countrieswas inspired by Greta Thunberg, a Swedish climate activist. The recent crisisalthough induced lower emissions but for the wrong reasons. Climate changeimprovement in relation to the technological measures are tools that could beincorporated into the oil and gas game changer and digitalization scope. Oilproducing and oil servicing nations need to come to terms with how they aresilently or largely contributing to climate change. Efforts made towards buildingmore efficient technologies, clean energy and greenhouse gas reductions. Moreattention paid to the sustainability and energy reports quarterly or annually producedby these oil firms. Policy makers could take on the golden opportunity tocombine economic recovery with climate goals to design new measures bearingsimilar perspectives in mind.