The Expectations of Stakeholders in Eastern Africa’s Oil and Gas

About the ProjectOur project is titled Energy Development in New Producing Countries and seeks to understand how natural resource development can achieve inclusive economic growth through the localization of economic activities. We are engaged in a multiyear, multi-disciplinary study with three objectives: Assess the direct fiscal impact and trade-offs of policy choices.Understand how industry can be localized to create economic growth.Estimate spillovers and welfare impacts to society. Our initial focus is on four countries – Kenya, Mozambique, Tanzania and Uganda – that expect to develop significant oil and gas reserves in the next 5-7 years. Through natural resource development, these countries hope to achieve middle-income economic status by 2030-2040.Key PointsLocal content is a political imperative in Eastern Africa, and how it is implemented has implications for the economics of oil and gas projects and could also affect expected government revenues. Policymakers need to weigh the trade-off between encouraging local content against endangering the viability of a project by loading it with ill-equipped, untrained or costly local options. Highlights from a KAPSARC workshop on this issue include: Stakeholder expectations about local content should be tempered by an understanding of the size of the reserves and the development plans under consideration.For most new-producing countries, the opportunity to create meaningful local content is front-loaded in the value chain; primarily in the upstream activities. This is a significant point in Eastern Africa because the time needed for workforce and SME development will exceed the CAPEX phase of many upstream projects. Consequently, the promise of midstream and downstream local content would have missed the opportunity.Getting the expectations of stakeholders “right” will help maintain the social license to operate. One of the simplest ways to do this is to begin discussions, in real terms, on what an individual or family can expect in gains in welfare from the windfall revenues that will go to the government.

关于本项目
本项目的名称为《新兴生产国能源开发》，旨在探究自然资源开发如何通过经济活动的本地化实现包容性经济增长。项目团队正进行一项历时数年、跨学科的深入研究，旨在实现以下三个目标：
评估政策选择的直接财政影响及其权衡；
理解产业本地化如何创造经济增长；
估算对社会的外溢效应和福利影响。
项目初期聚焦于四个国家——肯尼亚、莫桑比克、坦桑尼亚和乌干达——这些国家预计在未来5至7年内将开发出重要的石油和天然气储备。通过自然资源开发，这些国家希望到2030至2040年间实现中等收入经济体的地位。
关键点
在东非，本地内容的生产是一项政治上的迫切需求，其实施对石油和天然气项目的经济效应以及预期政府收入产生重大影响。政策制定者需要在鼓励本地内容与避免因过度依赖未充分准备、缺乏培训或成本高昂的本地选项而危及项目可行性之间权衡利弊。
KAPSARC（阿卜杜拉国王石油研究中心）关于该问题的研讨会亮点包括：
关于本地内容的利益相关者期望应受到对储备规模和考虑中的发展计划的理解的调和；
对于大多数新兴生产国而言，在价值链中创造有意义的本地内容的机会主要集中在上游活动；
这是东非的一个重大问题，因为人力和中小企业发展所需的时间将超过许多上游项目的资本支出阶段。因此，中游和下游本地内容的承诺将错失这一机会；
准确把握利益相关者的期望将有助于维持运营的社会许可。实现这一目标的最简单方法之一就是从实际角度开始讨论个人或家庭从政府获得的意外收益中能够预期获得的福利增长。