Energy Capital & Power

Play by Play: The Great Rift Valley

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Vast, underexplored, and now known to be full of petroleum resources, the East African Rift System is one of the most exciting areas for onshore oil and gas investment in the world. Investor interest is piqued. AOP examines the plays of the Great Rift Valley in our latest Play by Play series.
Scientists call the East African Rift System (EARS) a geological wonder. Also known as the Great Rift Valley, it is one of the world’s best spots to understand the formation of continents and the dynamics of tectonic plates. The formation stretches from Ethiopia southwards, through Kenya, the Democratic Republic of Congo, Uganda, Rwanda, Burundi and Tanzania, ultimately ending in Malawi.
The rift is actively experiencing continental plate separation, and, importantly for oil and gas investors, it also hosted the biggest oil discovery in Africa in a generation. EARS, a prolific hydrocarbon area, has turned the region into the new hotspot for inland oil and gas exploration, after a 2006 discovery of crude oil in Uganda. Its fairly underexplored profile further raises the chances of additional discoveries.
The Great Rift Valley was formed by intense volcanic activity, which has also created mountain ranges, valleys and basins. It’s divided into two sections: The Western end extends for 2,100 kilometers, runs from Ethiopia through Lake Albert and Lake Edward and continues southwards through Lake Tanganyika, Lake Kivu and Lake Malawi. The Eastern section, which runs 2,200 kilometers, is characterized by mountains rather than lakes, and encompasses great volcanic systems including Kilimanjaro and Mount Meru in Tanzania, and Mount Kenya and Marsabit in Kenya. In both sections, the rift has a width between 40 and 80 kilometers, and variable depths.

“In all, the Great Rift Valley represents perhaps the most interesting underexplored region for oil and gas in Africa, and is deserving of our attention in the Play by Play series.”

These formations have great potential, with 6 billion barrels of oil discovered in Lake Albert in Uganda and 600 million barrels of oil discovered on Kenya’s side of Lake Turkana. Exploration is ongoing in Lake Tanganyika and the Malawi government is pushing forward with exploration of Lake Malawi. The methane gas reserves in Lake Kivu are set to help both the DRC and Rwanda face their energy shortcomings. In all, the Great Rift Valley represents perhaps the most interesting underexplored region for oil and gas in Africa, and is deserving of our attention in the Play by Play series.
While there is much to be excited about, this region is not without challenges. Nearly all of the areas identified as having hydrocarbons potential are located in border areas, one of which is disputed. Additionally some of the areas with the greatest promise, especially those around the Congolese border, are controlled by militant groups. A lack of established infrastructure poses a challenge and key projects under development are of upmost importance, including a Ugandan oil exports pipeline through Tanzania and a project to connect South Sudanese oil fields via a pipeline through North Kenya. All of these projects are years away from being finalized. Still, investor interest remains high.
After decades of neglect by the oil majors, the EARS discoveries, alongside the major natural gas discoveries offshore Tanzania and Mozambique, have opened the door for a new era of hydrocarbons exploration in East Africa.
In coming weeks AOP will be looking at the individual plays of the rift: Lakes Albert and Edward, Kivu, Malawi and Cahora Bassa, Tanganyika and Rukwa, and Turkana and Victoria.

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Energy Capital & Power

Energy Capital & Power

Energy Capital & Power is the African continent’s leading investment platform for the energy sector. Through a series of events, online content and investment reports, we unite the entire energy value chain – from oil and gas exploration to renewable power – and facilitate global and intra-African investment and collaboration.