Foreword: Second edition

Foreword: Second edition

With large capex projects and cash flows under pressure, E&P companies are under increasing scrutiny from the investment community.


This coming at a time when many of the supermajors have announced a further fall in profits. Companies now need to demonstrate that they can manage their portfolios in uncertain markets, while delivering promises made to investors.

I have discussed the emergence of Africa, as the new oil and gas powerhouse with many of you. Home to some of the world’s fastest growing economies, and with energy production across the continent forecast to grow by 40 percent by 2030 (source: Wood Mackenzie). West coast Africa continues to deliver significant volumes and East Africa, the continent’s newest energy frontier, provides a wealth of opportunities with large gas projects about to come onstream; significant discoveries still to be made and numerous deal opportunities.

Of course there are challenges to overcome in terms of geopolitical issues and disturbances; available infrastructure; and governance, before the industry can reach its full potential. And with this increasing dependency on energy, governments will be choosing partners that will most benefit their economic development, whilst companies are looking for attractive rates of return and a stable fiscal environment. Striking the balance between countries; investors; governments and local communities has never been more important.

A key consideration affecting any company’s ability to deliver when entering new markets is having a clear understanding of risk and uncertainty, and never more so than in Africa. Applying best practice forecasting techniques and being aware of the consequences, probability and impact of a risk event, allows you to better manage that risk. Making portfolio decisions with confidence amid uncertain conditions will also increase confidence among shareholders.

These are just some of the topics we look to cover in this latest edition of Focus on Oil & Gas – Focus on Africa.

We welcome back Sylvia Pfeifer, former special correspondent from the Financial Times, interviewing some key industry experts, to get their valuable insight. We talk to Andrew Gould, BG Group’s Chairman about his personal view of today’s industry, and to Claudio Descalzi, E&P COO at eni, in which he discusses eni in Africa and beyond. We also hear from Lord Hastings, KPMG international’s Global Head of Corporate Citizenship, and Oliver Kemp from Build Africa, who discuss best practice for working with local communities and achieving long term sustainability across the continent. I hope you find this a useful and interesting read. I would be very happy to discuss any of the topics with you in more detail, and I am always interested in hearing feedback from the industry, so please do get in touch.

Anthony Lobo

Partner, Head of Oil & Gas, KPMG in the UK

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