Africa beckons to energy producers
Africa might not rank high on the investment wish list of most Alberta businesses. But it’s attracting interest from a growing number of energy companies, says an Alberta International and Intergovernmental Relations official who is responsible for supporting Alberta trade development on the continent.
Shane Jaffer was in Red Deer on Thursday to speak at a seminar about accessing international markets. The department’s director for Africa, as well its international development office and international financial institutions, he described the potential that Africa has as an energy producer.
“If we started looking at where the next horizon of opportunities are going to be in oil and gas, it’s really in Africa.
“I think 25 per cent of new discoveries are in Africa.”
A number of Alberta companies are already established there, said Jaffer, including Suncor Energy Inc., Canadian Natural Resources Ltd. and Talisman Energy Inc.
“We have five or six Alberta companies that are already active in Tanzania.”
Jaffer said he’s leading a delegation of about 16 companies to the Africa Oil Week conference in Cape Town, South Africa in November.
“There are four Alberta companies who are speaking at the event.”
And over the next few months, the Tanzania minister of energy, as well as delegations from Angola and Nigeria, will be visiting Alberta — with all focused on the oil and gas industry.
North Africa has long been an oil-producing area, said Jaffer, but new opportunities are now opening up for Canadians there. West and East Africa also have off-shore and land-based oil reserves, with many of the latter difficult to access.
“It’s something where Alberta has a lot of expertise. Not many other countries seem to have that expertise.”
A broad range of products and services are needed, said Jaffer. And because Africa’s energy sector lags behind Alberta’s, it’s not necessary that these be cutting edge.
“You have to start thinking that some of these companies are 10, 15, 20 years behind in terms of technology,” he said, adding that other attributes are more important.
“You need to be able to provide good quality service, good equipment and good follow-up.”
Operating in Africa does pose challenges, acknowledged Jaffer. In addition to the distance, as well as cultural and language differences, political uncertainty is a concern.
“It’s a little more high-risk,” he said.
“But there are higher degrees of pay-off as well.”
The Alberta government can provide support, said Jaffer, and it’s a good idea to find a domestic partner with whom to work with.
Thursday’s session was organized by Central Alberta: Access Prosperity, along with the provincial and federal governments. In addition to Jaffer, there were speakers representing the World Bank; Export Development Canada; Foreign Affairs, Trade and Development Canada; and companies active in international markets. International and Intergovernmental Affairs Minister Cal Dallas also took part.