Better Conditions See West Africa Attract Most Oil, Gas Workers

Better Conditions See West Africa Attract Most Oil, Gas Workers
Better conditions, higher pay and more jobs sees West Africa attracts the largest numbers of oil and gas workers in the African continent, oil and gas analysts say.

West Africa attracts the largest numbers of oil and gas workers in the African continent for a number of reasons, oil and gas analysts say.

“The most obvious reason is that West Africa is the main oil and gas hub in Sub-Saharan Africa, so there's simply more exploration and production going on there, and thus more job opportunities,” said Jane Morley, an analyst at the Economist Intelligence Unit focusing on the Middle East and Africa.

Five of the top ten oil producers in Africa are located along the West Coast, which is why operations in the region require a larger number of workers than other parts of the continent, Morley’s colleague and fellow Middle East and Africa analyst Cailin Birch explained.

“The West coast has seen a boom in oil exploration in the last 10 to 15 years … particularly since the discovery of Ghana's significant Jubilee field in 2007,” Birch told Rigzone.

“Several commercial oil and gas strikes made in the pre-salt layer off the eastern coast of Brazil in recent decades have raised explorers' hopes for major finds off the coast of West Africa, which shares geological similarities,” Birch added, shedding some light on why the region has seen an uptick in upstream activity.

West Africa has historically accounted for the largest capital expenditure in the African continent with over 70 percent of the total in the last five years, said Pabina Yinkere, the head of research division at Vevita Capital Management Limited, citing an African oil and gas review published this August from PWC titled ‘The Choice to Change’.

Although new investment in offshore exploration has fallen off sharply since mid-2014 as slumping global oil prices have made the operating environment in West Africa less attractive, Birch said, several projects launched in the last decade have kept up demand for staff.

Half of Sub-Saharan Africa’s current big four producers are located outside of West Africa, Morley explained, in the northern part of the continent. These countries are going through some issues at the moment though, which Morley suggested could be aiding West Africa’s popularity among the working community.

“Development in Algeria is being held back by subdued oil prices, financing constraints and inefficiencies at Sonatrach, while in Libya oil output remains well below the 2010 pre-conflict level of 1.55 million barrels per day because the government, or rather, governments, are struggling to prevent sabotage of ports and fields by jihadi groups, and regain permanent control of key facilities,” Morley said.

Shifting her attention to the eastern part of the continent, Morley admitted that East Africa has plenty of potential but stated that the region is at a relatively earlier stage of development in terms of commercializing its hydrocarbons resources.

“This means that it is also at an earlier stage of tackling issues such as supply chain management, regulatory challenges and safety concerns. It also, of course, means that costs are higher relative to West Africa, where the necessary sectoral infrastructure in the west is already in place,” Morley said.

Operator Rates Up To 25% Higher in West Africa

Better pay is also a factor that is driving employees to West Africa.

“According to Hays’ 2015 global salary guide, contractor rates for operators and technicians were around 15 to 25 percent higher in West Africa than in East/Southern Africa,” Morley stated.

Senior oil and gas workers and manager leads/principals in West Africa earn $70 and $40 per day more, respectively, than employees in the same roles in eastern and southern Africa, and $190 and $180 per day, respectively, more than employees in the same roles in North Africa, according to Hays’ 2015 oil and gas global salary guide. Although the report outlined that vice president/director day rate salaries were largely similar in West Africa ($1200) and East/South Africa ($1210), these employees in North Africa received hundreds of dollars less ($550).

Compared to wider oil and gas economies, West African day rates for operators/technicians and senior positions ranked sixth out of 13, behind regions like North America and West Europe, and West African day rates for manager lead/principal roles ranked seventh. In terms of day rates for vice president/director roles, West Africa came third in the table produced by Hays, which was topped by Australasia, which pays employees in these roles $1300.

A graduate in journalism from Cardiff University, Andreas has eight years of experience as a business journalist. Email Andreas at andreas.exarheas@rigzone.com

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