While the world is still turning back to normalisation, the oil and gas industry is pacing ahead with slight optimism yet don’t see a full recovery soon. Covid-19 crippled this sector with uncertainties and the pre-Covid crisis in the energy sector is struggling to mitigate the after-effects of the shrinking global economy.
In 2020, Africa accounted for approximately 8% of the global output, with 330 million metric tons of oil being produced in the African continent itself. While African produced the lowest production level of 6.9 million barrels per day in 2020, oil production still remains the primary driver of the economy with its vast reserves soon to be launched in other African regions.
The oil and gas companies are looking forward to huge challenges to cater to in the coming years. Some of the key trends the African continent can look out for are:
- 2021 second half to view a higher demand in Oil & Gas: With Covid-19 vaccination going in full swing in most parts of the world, the oil and gas industry is expected to come back at least to better demand in the second half of the year 2021. Companies such as airlines, automotive, and the power sector are expected to resume their normal operations. This will drive the energy sector to rebound.
- The digitalisation of the energy sector: Digital disruption has paved a way for digitalization in the oil & gas sector through Artificial Intelligence. This will enable companies to modernise their operations and be at par with the industry standards. It is also expected to have a transformation in various other sections in the oil and gas companies like workforce management tools, GPS sensors, SCADA system to detect leaks before it happens, tracking and alerting system. This will ensure better productivity, efficiency and reliability in the operations.
- The focus on Natural Gas: The resurrection in the demand for Natural gas happened due to the eco-friendly way of living. Natural gas is a sustainable and environmental-friendly option that is expected to be explored and exploited in 2021. The world is looking for low-carbon emissions and natural gas will perfectly serve the purpose.
- Safety considerations: Covid-19 has brought and expanded a new trend that is nowhere to go anytime soon- safety precautions. Oil and gas companies are expected to focus more on the wearables and the environment in which the employees work. It will include the use of augmented virtual and real devices. This will allow the monitoring of hazardous places without actually being physically present on site. Other safety precautions will include monitoring air quality, employee vitals etc.
- Labour Cost Spike: A major chunk of human resource in the oil and gas industry comprises old employees, which comes with its own challenges of safety as well. Companies are expected to bring in the younger workforce which will ultimately increase the labour cost. The employment of specialised employees with a defined skill set might add to the cost.
- Robotics: Essential activities in the oil and gas companies can sometimes turn repetitive and boring for an employee. This bored feeling might result in unintentional errors. Such activities are expected to be replaced by robots to bring in more efficiency and zero-errors. Robotics can also reduce labour costs in the long run.
The African oil market is increasingly becoming an expanding investment market for new and innovative discoveries to position themselves. With more oil industry opportunities setting up a platform in Nigeria, Egypt, Mozambique, Mauritania, and Equatorial Guinea, Africa can ease the energy crisis while adopting the key trends in the industrial domain.