The West African oil and gas market is estimated to grow at a compound annual growth rate (CAGR) of 6.5 per cent from 2025 to 2033, Deloitte’s new report has revealed.

The report, titled “Shaping Opportunity from Complexity in West Africa’s Oil and Gas Market,” said the sector worth approximately $80 billion was demonstrating strong growth potential, driven by global energy demand and rich reserves in the region.

“The oil and gas sector in sub-Saharan Africa is facing a decisive inflection point. From Nigeria’s hydrocarbon-rich delta to Angola’s offshore blocks, to the enormous gas reserves in the East Africa Rift Valley, the continent is recalibrating its approach to energy equity, security, and sustainability,” it said.

For instance, the report noted that in Ghana, which accounted for 20 per cent of the value of the West African oil and gas market, recent policy shifts were helping to reposition the country as an investment destination following a period of stalled production growth.

It added that new government efforts to resolve long-standing disputes and reissue dormant licences were being closely watched.

The report identified five issues that could affect the growth of the sector — constrained access to funding for independents, a persistent cost premium effect, ongoing security threats to critical infrastructure, limited regulatory collaboration, and insufficient enabling infrastructure.

“While some of these issues are structural and longstanding, others have been exacerbated by new political, economic, and energy transition dynamics. Together, these challenges define a uniquely African landscape for 2025, one that demands adaptive thinking and long-term resolve,” the report stated.

Particularly on funding, Deloitte said access to capital remained the “most defining pressure point for the region’s independent oil producers.”

“While international oil companies continue to operate with deep financial buffers and global portfolio balance sheets, African independents face tightening margins and investor hesitancy. Environmental, Sustainability and Governance pressures, divestment from fossil fuels, poor corporate governance practices, and perceived regulatory and political risks in African markets have made capital both scarce and expensive,” the report said.

It added that the capital drought has led to a concentration of additional investments among a few big players with access to global lending or private equity relationships, noting that many others were resorting to sale-and-leaseback agreements, alternative funding arrangements, or joint ventures with non-traditional partners.

“Insights from Deloitte’s transactions team, who advise on both buy- and sell-side energy transactions in the region, indicate there is a growing trend of independents struggling to raise funding to support new acquisitions and further development activities,” the report said.

Deloitte described the establishment of the Africa Energy Bank, to be headquartered in Nigeria with initial funding of $5 billion, as a good initiative expected to alleviate the funding constraints of independent producers and provide financing solutions for Africa’s energy sector amid growing transition pressures.

On infrastructure, the report said that despite having significant reserves, many parts of Africa lack the basic infrastructure required to monetise those resources effectively.

It explained that midstream and downstream infrastructure — pipelines, refineries, roads, and storage facilities — remained underdeveloped or entirely absent.

“Africa’s energy future hinges on the availability of capital for both legacy and new-energy projects. The formula for success will require bankable projects, investor-ready business models, and improved perceptions of regulatory and operational stability in equal measure,” Deloitte stated.