The AEC’s State of African Energy 2026 Outlook examines how Africa can unlock value from its undeveloped gas resources by balancing LNG exports, domestic power and industrial demand.
CAPE TOWN, South Africa: Africa’s natural gas potential is undeniably significant, with the continent ranking second globally in terms of discovered but undeveloped gas resources. According to the African Energy Chamber’s (AEC) State of African Energy 2026 Outlook (www.EnergyChamber.org), more than 550 trillion cubic feet (tcf) of recoverable gas remain undeveloped, highlighting a strategic opportunity for investors. Major basins such as Mozambique’s Rovuma Basin (129 tcf) and Nigeria’s Niger Delta (113 tcf) underscore the scale of opportunity. However, opportunities in the sector lie not only in finding supply, but creating viable routes to monetization, industrialization and domestic demand.
LNG Exports Anchor Monetization
With significant export capacity already online, LNG remains the most established monetization route for African gas. In 2024, Africa supplied 34.7 million tons of LNG – with sub-Saharan Africa alone contributing 26.9 million tons. Nigeria, Angola, Equatorial Guinea and Cameroon were already exporters, while Mozambique’s Coral Sul FLNG and Senegal-Mauritania’s Greater Tortue Ahmeyim (GTA) project have added new capacity since 2022. Africa’s geographical proximity to both European and Asian markets give the continent a strategic advantage as west and southwest African LNG producers can serve as swing suppliers based on price spreads between Europe and Asia.
Meanwhile, several African export projects include domestic market obligations (DMOs), providing a portion of supply for local power and industrial use. Senegal, for example, plans to draw much of its gas-to-power feed from DMOs tied to GTA and the proposed Yakaar-Teranga LNG project. While DMOs can stimulate early domestic demand, they introduce counterparty and pricing risks. Furthermore, domestic gas prices are often far below international netback levels, creating a challenge for developers.
Global LNG supply is forecast to increase sharply through 2030, driven by the U.S. and Qatar. According to the AEC’s report, this has the potential to push Asian and European benchmark prices down from the $10-$13 per million British thermal unit (MMBtu) range seen in 2024-2025, potentially falling below $6 per MMBtu by the late 2020s. In this context, Africa must compete with increasingly competitive exporters while continuing to develop new projects and supply sources.
Domestic Gas: Power and Industrialization
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