Sub-Saharan Africa investment and cost trends: have costs fallen far enough?

2017 operating costs in Sub-Saharan Africa have been cut by more than US$2.4 billion since the oil price fall. Cheaper services, optimisation and deferred project start-ups have helped realise savings in a US$50/bbl world. However, stubbornly high labour and logistical costs, and the shift from capital investment to field maintenance have increased the per-barrel operating cost in some countries. Production is down from our pre-price crash forecast and only three projects reached FID in the last three years. With exploration at historic lows and Pre-FID projects still requiring lower costs, Sub-Saharan Africa is not out of the woods yet.