In Africa, the most severe recession in over 25 years is looming. Even before a single case of COVID-19 was reported in the continent, Africa was already facing economic consequences as a result of the wide spread outbreaks in other world economies. Trade balance has plummeted and capital has flown.
“EPC (Engineering, Procurement and Construction) contracts on LNG projects are met with a bottomless pit of claims. Some contractors struggle to provide what they claimed, after bidding low, and try to recoup costs with claims that can amount to 20- 30% of project value. Other contractors advance genuine claims instigated by changes to the project itself. Relatively few contractors can handle major LNG projects, which remain a niche area.”
Slava Kiryushin, Global Head of Energy, DWF
Despite this, LNG can have a promising future in Africa if challenges associated with the current coronavirus and economic crisis are managed effectively with the right political support.
Find out more about the new normal for LNG in Africa.