2
015 was a challenging year in Africa for most E&P and
oilfield service (OFS) companies. Major OFS company
workforces were slashed between 15% and 21% and
international oil companies responded in a similar fashion.
Significant impairments and substantial reductions in profitability
have been observed. Exploration and production has largely
stopped with the effect that some production areas are likely to
see a decline in output and new developments coming online at a
slower rate. Capital expenditure has also reduced significantly.
Initially the expectation of the industry was that the oil price
downturn was just a normal cycle and that the drop to US$50/bbl
would be short lived. This has not been the case, and the
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