Exhibiting Africa’s Growing Mergers and Acquisition Activity: Africa Export-Import Bank to Host a Deal Room at African Energy Week 2023

By Abdul Rahman Bangura–

NEW AFRICA DAILY NEWS (NADN) Freetown, Sierra Leone –New awareness from the African Energy Chamber’s (AEC) ‘State of African Energy Q2 2023 Outlook’ report disclose crucial steps rendered in Africa’s M&A sector, with announced and finalized marketing’s already exceeding the $1.85 billion tag in the first half of 2023. These figures are expressive of a prosperous financial topography that fights established prospects.

Crucial supporters to this stunning commerce volume are the announced sale of Angolan assets by Galp to Somoil in February and the upcoming appropriation of Aker Energy in Ghana by the Africa Finance Corporation (AFC). These marketing’s independently account for a substantial portion of the total transaction value, with individual figures of $655 million and $605 million, respectively. Besides, Malaysian NOC Petronas departed Chad, confirming the transfer of its interests in oil fields and export pipelines. Eni’s planned sale of a portion of its Congo portfolio to UK-based Perenco, although previously to be closed, is predicted to boost impact Africa’s 2023 M&A transaction value.

In the first half of 2023, around 320 MMboe of recoverable reserves were traded. Virtually 85% of these were crude oil, with around 65% of the traded volumes emanating from offshore Deepwater areas. Agreeably, 35% of the resources traded were in the producing phase, eliminating the need for additional CAPEX investments. Contrarily, practically 50% of the traded volumes were pre-FEED, potentially expecting higher investments.

Nevertheless, the impact of several external components steering these transactions necessitates a subtle computation of hydrocarbon trading, asset lifecycle, and location to avert crooked metrics.

The analysis of transactions discloses a change in trends, with Angola, Ghana, Chad and Morocco ensuing as key transaction intersections. Notably, investors from major companies have been scarce, inconsistent to probabilities associated to the energy transition and cost-cutting policies. This divergence, bonded with majors’ investments in research and growth across Africa, hints positive possibilities for the landmass.

In the context of Africa’s growing energy landscape, Afreximbank’s enterprise to host a deal room during AEW 2023 occurs as a climacteric stimulus for the mainland’s energy security and its alignment with the global energy transition. This undertaking carries paramount significance, as it furnishes a strategic forum for enabling partnerships, investments and collaboration essential for propelling Africa’s energy sector into a sustainable and secure future.

With energy security emerging as an important interest for many African nations, the deal room administers as a chute for enabling critical dialogues that can steer to the diversification of energy sources, the integration of renewables and the optimization of hydrocarbon assets. By converging industry leaders, investors and policymakers, this platform has the potential to accelerate the deployment of innovative technologies, stimulate indigenous energy production and enhance regional cooperation, ultimately contributing to Africa’s energy self-reliance.

“As the world transitions towards cleaner energy sources, the deal room offers African countries an opportunity to leverage their vast renewable energy potential, attract international investments, and align their energy strategies with global sustainability goals,” states NJ Ayuk, executive chairman of the African Energy Chamber, adding “Afreximbank’s commitment to fostering an environment conducive to strategic partnerships through the deal room underscores its pivotal role in shaping Africa’s energy future, reinforcing its resilience, and ensuring its active participation in the ongoing global energy transition.”

For New Africa Daily News Abdul Rahman Bangura Reports,  Africa Correspondent