Middle East Invests $6 Billion in African Energy Assets
Gulf Nations Expand Footprint in Africa’s Energy Sector
Middle Eastern countries have demonstrated a growing appetite for African energy investments, with recent deals and expressions of interest totaling at least $6 billion. This surge highlights the region’s strategic focus on diversifying energy assets across the continent.
Key Deals and Investments
Abu Dhabi National Oil Co (Adnoc) has been shortlisted to acquire Shell Plc’s downstream assets in South Africa, valued at approximately $1 billion, according to sources familiar with the negotiations.
In another major development, Dubai-based Alpha MBM Investments LLC—a private investment firm linked to the Dubai royal family—signed a deal with Uganda to construct a 60,000 barrel-a-day refinery, holding a 60% stake in the $4 billion project.
“African countries offer great opportunities for Gulf nations to diversify their oil and gas industries,” said Andrew Farrand of Horizon Engage, a political risk consultancy.
Growing Trade Relations
Bilateral trade between Africa and the UAE surged 38% over two years, reaching $86 billion in 2023, as reported by the African Export-Import Bank.
Recent Energy Deals in Africa
| Company | Deal Details | Value |
|---|---|---|
| Adnoc | Shortlisted for Shell’s South Africa assets | $1 billion |
| Alpha MBM | Uganda refinery project | $4 billion |
| XRG | Mozambique offshore gas stake | $1.4 billion |
Strategic Benefits for Africa
Farrand noted that partnerships with Gulf nations provide African governments with resource-rich allies rather than purely extractive investors. Kenya, for example, extended a fuel credit agreement with Adnoc, Saudi Aramco, and Emirates National Oil Co to stabilize its currency.
These investments also support regional energy distribution, with fuel imports from Gulf suppliers reaching markets in South Sudan, the Democratic Republic of Congo, and Burundi.
Source: Moneyweb
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