Africa’s oil and gas industry is showing renewed momentum, with production levels rising and fresh discoveries that add billions of barrels of reserves to the continent’s resource base. 
 
But despite rising upstream activity, the African Refiners and Distributors Association (ARDA) said downstream investments continue to lag, posing significant questions about energy security, industrialisation and long-term value creation on the continent. 
 
While Nigeria is expecting a capital inflow of about $18.2 billion in the upstream this year alone, data from Wood Mackenzie shows that Africa’s oil and gas production averaged 5.3 million barrels of oil equivalent per day (bpd) in 2024, representing a five per cent increase on 2023 levels. 
 
The performance reflects a gradual but notable rebound in upstream activity following years of underinvestment and operational challenges in key producing countries.
In August, Nigeria’s oil production went to about 1.7 million barrels per day after years of averaging 1.4 million bpd.
 
Nigeria and Angola continue to dominate regional output, supported by contributions from Gabon, Equatorial Guinea, Congo, Ghana and other sub-Saharan African producers. 
This is due to strong growth in development drilling, even as overall capital investment in the sector has marginally declined. 
 
According to the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), 72 development wells were approved for drilling and completion as of July 2025. 
Capital spending in the African upstream sector dipped slightly in 2024 compared with previous years.  
However, the nature of investment is shifting, with a greater share directed towards development drilling, reflecting efforts to boost production from existing fields rather than expand greenfield projects.
 
Oil majors accounted for 37 per cent of upstream capital expenditure, WoodMac noted, signaling that IOCs continued but cautious engagement in African projects. 
 
At the same time, international national oil companies (NOCs) have increased their exploit, acquiring stakes in strategic assets and expanding their influence across the continent. The dual trend shows a diversification of players in the African oil and gas landscape, with the balance gradually moving beyond the dominance of Western majors.
 
One of the most notable developments in 2024 was the discovery of an estimated three billion barrels of oil equivalent (boe), with significant finds reported in Côte d’Ivoire and Namibia.    
 
The discoveries underscore Africa’s continuing potential as a frontier of hydrocarbon exploration.

In addition, approximately 120,000 square kilometres of exploration and undeveloped acreage were awarded during the year, creating further opportunities for resource development. These awards not only provide international and local investors with access to high-potential basins but also expand the region’s reserve base, supporting long-term supply security.

Executive Secretary of ARDA, Anibor Kragha, noted that downstream investments are not keeping pace with upstream growth. 

He decried that refining, petrochemicals and related value-adding industries remain underdeveloped in many African economies. The mismatch risks perpetuating a cycle where Africa exports crude oil but imports refined petroleum products at a significant cost.