With upstream capital expenditure set to reach $41 billion in 2026, Africa’s rising exploration and production (E&P) activity highlights the evolving landscape of above-ground attractiveness across the continent. According to the African Energy Chamber’s (AEC) (https://EnergyChamber.org) State of African Energy 2026 Outlook, African countries currently fall mostly in the mid-range of global attractiveness scores. However, a series of reforms, fiscal adjustments and strategic licensing initiatives are set to improve investor returns and deepen engagement across the continent.
Above-Ground Trends Shaping Investment
Political change, civil activism and shifting governance structures are creating new dynamics for African E&P. The waning of legacy European influence is being replaced by growing engagement from foreign powers, including China, Russia, the U.S. and Middle Eastern investors, impacting the diplomatic and investment landscape. Recent elections in South Africa, Senegal and Mozambique demonstrate how political flux can impact investor confidence and E&P operations.
Resource nationalism and local content requirements are also becoming more prominent. Governments are increasingly seeking to optimize national benefits from hydrocarbons through greater state participation, local ownership and employment measures. Countries such as Senegal, Mozambique, South Africa, Tanzania and Namibia are actively debating these policies. The evolving regulatory and social environment could empower civil society and labor unions, while environmental activities continue to scrutinize exploration in sensitive regions such as the Democratic Republic of Congo (DRC), Namibia and South Africa.
Strategic Licensing and Renewed Investor Interest
Amid renewed interest in deepwater exploration, sub-Saharan African producers are driving competitive licensing rounds to attract international operators and national oil companies (NOCs). Bid rounds are ongoing or planned in Angola, the Republic of Congo, the DRC, Nigeria and Tanzania, with host countries offering more attractive fiscal and contractual terms. African governments are also increasingly flexible in dealing with a diverse investor base, ranging from local independents to international NOCs and financiers such as Middle Eastern banks, Asian export credit agencies and global trading firms.
Countries including Angola and Nigeria have implemented institutional, regulatory and contractual reforms aimed at unlocking upstream investment. Streamlined mergers and acquisitions approvals, clearer legislation and transparent licensing frameworks are critical to attracting cross-border capital. Emerging markets such as Ivory Coast, Kenya, Namibia and Senegal/Mauritania are under investor scrutiny as potential sites for strategic acquisitions and greenfield projects.
Focus on Gas Regulation and Industrialization
African governments are also prioritizing gas regulation to unlock lower-carbon growth opportunities. Clear frameworks for the gas value chain are expected to stimulate domestic industrialization, power access and international supply diversification. While pioneering projects such as Congo Floating LNG have advanced, other initiatives in Nigeria, South Africa and Tanzania have been delayed due to contractual and offtake uncertainties. Pending gas master plans and legislation in Angola, the Republic of Congo, Nigeria and South Africa will be pivotal in determining how much of Africa’s undeveloped gas potential can be mobilized for export and domestic consumption.
Spotlight on Key Country Developments
Angola has emerged as a leading host country for E&P investment in Africa. Its above-ground risk score has steadily improved since 2017, reflecting extensive regulatory and institutional reforms. Angola’s fiscal incentives, including terms for gas, marginal fields, and incremental production, have successfully attracted upstream investment, consolidating its status as a continental leader.
Ivory Coast maintains a pragmatic approach to foreign investment. Regardless of the outcome of the 2025 presidential election, authorities are expected to continue supporting upstream investors while emphasizing adherence to local content requirements, particularly for offshore developments.
Mozambique is witnessing a cautious restart of onshore LNG projects following the stabilization of post-election political challenges and improved security in Cabo Delgado. TotalEnergies’ Mozambique LNG project is set to resume construction in the second half of 2025, while Eni’s Coral North FLNG project remains on track. Despite progress offshore, onshore development may remain gradual due to lingering security risks.
Namibia is transitioning toward full producer status under President Netumbo Nandi-Ndaitwah. The country has consolidated oil and gas oversight under the presidency and is establishing an independent hydrocarbon regulator. Proposed increases in NOC NAMCOR’s share and local content requirements aim to strengthen the sector but could slow project approvals during a critical development phase.
Nigeria is reinvigorating its licensing program with updated terms and incentives targeting specific terrains and resource types. The government plans its third licensing round in three years, signaling a departure from decades of limited acreage availability. Renewed interest in projects such as TotalEnergies’ Ubeta onshore gas development and Shell’s Bonga North deepwater FID highlights growing investor confidence in Nigeria’s upstream potential.
African Energy Week 2026
Africa’s E&P sector is at a pivotal moment. Strategic licensing, institutional reform and evolving fiscal frameworks are enhancing above-ground attractiveness, while political and social dynamics continue to shape the operating environment. As international investors seek opportunities across the continent’s hydrocarbon frontier, the upcoming African Energy Week conference – returning to Cape Town in 2026 – will explore how clear regulation, competitive fiscal terms and effective risk management will drive new investment and support Africa’s long-term energy ambitions.
“The continent offers compelling opportunities for investors who are prepared to engage in a transparent, regulated, and increasingly competitive E&P landscape,” states NJ Ayuk, Executive Chairman, AEC. “Governments and operators must continue to balance national priorities with investor confidence to unlock Africa’s vast hydrocarbon potential.”
