East Africa Oil and Gas Downstream Market - Growth, Trends, and Forecast (2020 - 2025)

The market for oil and gas downstream in East Africa is expected to register a CAGR of about 2.32% during the forecast period of 2020 - 2025. Factors, such as the increasing demand for oil and natural gas, are expected to boost the demand for the East Africa oil and gas downstream market during the forecast period. However, political instability, due to civil war, in countries of East Africa, like South Sudan and Somalia, impeded the growth of the oil and gas downstream sector.

• - Refining capacity, in the countries of the region, is expected to increase significantly. An increase in the production of oil and gas in the region is expected to increase the refining throughput capacity.
• East Africa's companies are expected to invest in the exploration and production of East Africa's oil and gas fields. It is likely that the investment would increase production and create an opportunity for cheaper oil and gas for the refineries.
• New investments are expected to be added in the refineries and petrochemicals sector of Ethiopia in the forecast period. This is expected to boost the growth of the sector.

Key Market Trends

Refinery Capacity to Witness growth

The countries in the East Africa region have low refining capacity, compared to the population in the region. In the coastal countries of the region, major gas wells have been discovered. Countries, like Mozambique and Tanzania, have tried to ramp up projects to increase natural gas production.

• Some companies in the oil and gas sector have proposed to the Government of Kenya that the Amosing, Ngamia and Twiga fields should be developed. This would include a 60,000 to 80,000 barrels per day Central Processing Facility (CPF) and an export pipeline to Lamu.
• Oil consumption increased by 2.9% from 29.8 million ton of oil equivalent (Mtoe) in 2017 to 30.7 Mtoe in 2018. Th increasing demand for oil and stability in the region is expected to augment the growth of the market.
• Hence, refining capacity is expected to increase in the forecast period, due to an increase in gas production in the region.

Ethiopia to Witness Significant Growth

In 2018, a new refinery is expected to be constructed in the city of Awash, Ethiopia, in the forecast period, with a refining capacity to process 120,000 barrels per day. The refinery is expected to increase the refining capacity in the region and reduce the dependence on imports from countries, like India and China.

• In East Africa, there was an increase in the demand for natural gas by 7.5%. It was increasing from 1.7 million tons of oil equivalent (Mtoe) in 2017 to 1.9 Mtoe in 2018.
• In 2018, a refinery project, with a capacity of 6 million metric tons, was expected to be established in the forecast period in Damerjog Industrial Park. It is expected to allow Djibouti to transition to lower-sulfur marine fuels.
• Al-Jaili has a total capacity of 100,000 b/d, in 2019. It is the largest refinery in Sudan. It has two production lines that are capable of refining both Nile and Fula blend crude oils. It is operated by China National Petroleum Corporation and Sudan National Petroleum Corporation in collaboration.
• The Ethiopian oil and gas downstream industry is expected to witness a growth during the forecast period, due to an increase in investments in the country.

Competitive Landscape

The East Africa oil and gas downstream market is consolidated. The major companies include Sudan National Petroleum Corporation, China National Petroleum Corporation, Eni SpA, Royal Dutch Shell PLC, and Petrogal SA.

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