In the PwC Africa, oil & gas review, 2016 report the international advisory company states that in the face of global oil prices declining, the African continent still offers significant opportunities in the oil & gas industry.

Chris Bredenhann, PwC Africa Oil & Gas advisory leader, said: “It is an opportune time for local governments that want to attract oil and gas investors to reform their regulatory, fiscal and licensing systems.”

The report highlighted that uncertain regulatory frameworks are one of the main issues that organisations in the oil & gas industry are struggling with.

For instance, in South Africa, the study noted that there have been commitments to address concerns since 2015, and the intention of government to separate regulations for oil & gas from the mining industry was communicated.

However, South Africa’s Minerals and Petroleum Resources Development Act (MPRDA) has not yet been changed and approved to reflect such modifications.

Meanwhile, the report states that in Tanzania the regulatory environment remains uncertain despite the promulgation of the Petroleum Act in 2015.

On the other hand, in Nigeria the government has failed to pass the Petroleum Industry Bill into law, the paper noted.

The research found that by the end of 2015, Africa had a proven natural gas base of 496.7 trillion cubic feet (Tcf), down marginally from 2014, with 90% of the continent’s natural gas production still coming from Nigeria, Libya, Algeria and Egypt.

PwC’s analysis suggests that now is the ideal time for the industry to consider introducing training programmes to upskill levels and company standards in order to give local players a chance to enter the sector when activity picks up again.

“The oil and gas industry is faced with a higher entry barrier because technology and jobs tend to be more complex, highly specialised and costly,” Bredenhann noted.

Another point made by the research was that basic as well as technological infrastructure is essential for the oil & gas sector to thrive.

“Furthermore, players must look at the current state of the industry as an opportunity to reinvent themselves. Given the state of the industry, we think that stakeholders must also consider making changes to their business models,” Bredenhann stated.

He added: “Change is the way to survive in the ‘new energy future’. We need to see new business models, new products, new energy sources and new strategies to meet the new reality.”