Did you know that Cameroon is the fifth-largest oil producer in Sub-Saharan Africa? 

Cameroon’s oil and gas industry is a significant component of its economy. The industry not only contributes substantially to the nation’s GDP but also offers vital employment opportunities. The country’s proven petroleum reserves are estimated at 400 million barrels, with oil production peaking in 1985 at 186,000 barrels per day. 

However, it has since declined to current levels around 60,000 barrels per day due to various challenges. Despite these declines, the industry has been exploiting marginal fields and developing small new fields. Cameroon also has significant natural gas reserves, estimated at around 4.8 billion cubic feet. 

The journey of Cameroon’s oil and gas industry began in earnest in the early 20th century. The industry has evolved since the first oil discovery in 1977 in the Rio del Rey Basin, marking the beginning of commercial oil production a year later. This discovery placed Cameroon on the map as a noteworthy oil producer in the Central African region​.

The 1980s were the peak of oil production, reaching up to 186,000 barrels per day in 1985. This period was characterized by growth and substantial foreign investment, attracting major international oil companies. 

The companies like Elf (now TotalEnergies), Perenco, and Royal Dutch Shell. The involvement of these companies brought advanced technology and expertise to the local industry. They significantly increased production capabilities​.

However, in the next few decades, there was a decline in production levels, falling to about 62,000 barrels per day by 2012. This decline was partly due to the natural depletion of older fields and the industry’s failure to find significant new reserves to replace them. Despite these challenges, the government took steps to enhance the viability of marginal oilfields. The government also introduced incentives to attract new exploration and development projects​.

In the late 2000s, there was the cession of the Bakassi Peninsula from Nigeria to Cameroon in 2006. This was believed to hold substantial offshore oil and gas reserves. This event was expected to lead to new exploratory activities and potentially large finds that could revitalize Cameroon’s oil sector​. 

In addition to oil, natural gas has increasingly become a focal point of Cameroon’s energy strategy. The country has made significant strides in developing its gas infrastructure. The Hilli Episeyo FLNG facility which has processed and exported significant quantities of liquefied natural gas since its inception​. 

Today, the industry is managed by the National Hydrocarbons Corporation (SNH), which oversees the exploration, production, and distribution of hydrocarbon resources.

Cameroon’s oil and gas sector is characterized by a mix of aging fields and promising new developments. The country’s proven reserves and strategic geographic location continue to attract interest from major international and regional players in the oil industry.

The backbone of Cameroon’s oil production remains the Rio del Rey Basin. It accounts for approximately 90% of the country’s total oil output. Other significant areas include the Douala/Kribi-Campo Basin. These show potential for further exploration and production​. Current production levels are maintained at about 60,000 barrels per day. This is a significant decrease from the peak levels of the 1980s. However, this has been stabilized by the development of marginal and small fields​.

Natural gas development has seen significant advancement with the operational success of the Hilli Episeyo FLNG facility. This marks Cameroon’s entry into the LNG export market. It also shows an innovative use of existing maritime assets to tap into offshore gas fields​. 

The Hilli Episeyo FLNG facility works by processing gas from local fields for export. This facility alone has the potential to boost Cameroon’s natural gas output significantly. It also attracts foreign investment due to its innovative approach to natural gas utilization.

1. Environmental sustainability: This remains a significant challenge for Cameroon’s oil and gas industry. The exploration and extraction activities have raised concerns about their impact on the local ecosystems. 

Particularly in ecologically sensitive areas like the Rio del Rey Basin and the Bakassi Peninsula​​. Issues such as oil spills, habitat disruption, and pollution pose risks not only to the environment but also to the livelihoods of local communities. 

These local communities depend on these ecosystems. The sector is also under increasing pressure to align with global environmental standards and adopt cleaner technologies. This shift is essential as Cameroon aims to balance its economic development objectives. This includes the need to reduce greenhouse gas emissions and manage natural resources responsibly​.

1. Global Fluctuation in Oil Prices: This significantly impacts Cameroon’s oil and gas sector. As a country that relies heavily on oil exports for foreign exchange earnings, the volatility of oil prices can heavily affect the national economy​​. This volatility requires the industry to be more adaptive and resilient. It needs to seek ways to reduce production costs and improve operational efficiency. The reliance on imported refined petroleum products due to inadequate refining capacity within the country further complicates the economic landscape. 

The fire incident at the SONARA refinery in 2019 highlighted the vulnerabilities in Cameroon’s oil supply chain. It highlights the need for substantial investment in domestic refining capabilities​​.

1. Untapped Oil and Gas Potential: Cameroon’s oil and gas reserves are far from fully exploited. There is significant unexplored potential remaining. Particularly in offshore regions and the underexplored Douala/Kribi-Campo Basin. 
2. International Partnerships: The government’s willingness to partner with international firms for exploration activities presents an opportunity to discover and develop new reserves. This helps in potentially increasing the country’s production output and energy self-sufficiency​.
3. Supportive Government: The Cameroonian government has committed to revitalizing the oil and gas sector through strategic investments.
4. Improving Infrastructure and Technology: The Cameroonian government is investing in infrastructure and technology. This includes plans to expand and upgrade existing facilities like pipelines and refineries. In addition to initiatives to promote new technologies for more efficient and environmentally friendly extraction and processing methods.

The oil and gas sector is very important to Cameroon’s economy. It shows a history of big achievements and current challenges. Cameroon has a lot of oil and gas that hasn’t been used yet. The government is working hard to improve this sector. The country wants to make sure it can produce its own energy and also deal with global changes towards more sustainable energy use. 

Investors looking at Cameroon will see many chances for growth. However, they must think carefully about the environment and the economy. This sector offers both risks and possibilities, representing the wide range of opportunities available across Africa’s varied markets.