UAE’s Expanding Influence in Africa's Oil & Gas Sector: XRG’s Strategic Investments

In addition to Mozambique, the UAE has intensified its presence in Africa by expanding its reach into Egypt’s energy market.

The UAE’s investment footprint in Africa's energy sector has undergone a remarkable expansion in recent years, with significant entries in oil and gas exploration. In a move that further cements its growing influence on the continent, XRG, the international energy investment arm of the Abu Dhabi National Oil Company (ADNOC), recently entered Mozambique’s Rovuma Basin. This acquisition is part of a broader strategy by the UAE to position itself as a leading player in Africa's energy sector, marking the country’s increasing footprint in the region’s oil and gas reserves.

XRG’s Strategic Move in Mozambique’s Rovuma Basin

XRG’s recent acquisition of a 10% interest in Mozambique’s offshore Rovuma Basin’s Area 4 concession is not only a noteworthy addition to its portfolio but also signals the UAE's strategic ambitions in the energy sector. The Rovuma Basin is one of the world’s largest natural gas reserves, with substantial potential to influence global Liquefied Natural Gas (LNG) markets in the coming decades. The basin is poised to become a major player in the energy world, and XRG’s involvement includes stakes in operational projects like Coral South FLNG, as well as planned ventures such as Coral North FLNG and Rovuma LNG projects.

With production capacities estimated to surpass 25 million tons per annum (MTPA), this move reflects XRG’s confidence in the growing demand for energy resources, underscoring the UAE’s commitment to securing diverse energy sources. As global energy demand continues to rise, having access to such significant reserves positions the UAE as a strategic player in the global energy market, capable of leveraging both its economic resources and political influence in the region.

Partnership with BP in Egypt: Expanding the UAE’s Regional Presence

In addition to Mozambique, the UAE has intensified its presence in Africa by expanding its reach into Egypt’s energy market. In December 2024, XRG joined forces with British energy giant BP to establish a joint venture, Arcius Energy, focused on developing gas assets in Egypt. This partnership is aimed at creating an integrated gas and chemicals portfolio that responds to the rising global demand for energy. As one of Africa’s most energy-rich nations, Egypt serves as a key strategic ally for the UAE in its broader goal of accessing untapped reserves and contributing to the region’s energy security.

Through these investments, the UAE is actively working to position itself as an integral partner in Africa’s energy future. The growing importance of natural gas in the global energy mix makes these partnerships all the more significant. By aligning with countries like Egypt, with substantial energy reserves and robust market potential, the UAE continues to strengthen its economic and diplomatic ties across the continent.

UAE Surpasses China as Africa’s Largest Investor

The UAE’s growing presence in Africa's oil and gas industry is part of a broader shift in investment trends on the continent. As of 2023, the UAE has surpassed China as Africa’s largest foreign investor. Between 2019 and 2023, Emirati companies invested an impressive $110 billion in Africa, a testament to the UAE's expanding footprint on the continent. This shift marks a pivotal moment in global geopolitics and underscores the UAE’s evolving strategy to diversify its investments across a broad spectrum of sectors, including energy, infrastructure, and technology.

While China had been a major investor in Africa for years, the UAE has now emerged as a stronger economic partner, particularly with its investments in key sectors like energy. The UAE has further strengthened its presence through green hydrogen projects in Mauritania, with Masdar committing $2 billion to renewable energy projects in Africa through 2030. Dubai’s DP World, which operates six African ports, and Abu Dhabi Ports, which has expanded into Guinea, Egypt, and Angola, further underscore the UAE’s expanding influence.

Strengthening Ties with Africa: A Vision for Long-Term Partnerships

This focus on Africa's energy sector comes at a time when many African nations are actively seeking foreign capital to unlock their full economic potential. The UAE’s investment strategy has been to not only secure energy resources but also build long-term partnerships with African nations to drive mutual economic development. These investments are part of the UAE's broader strategy to diversify its own energy portfolio, enhance its energy security, and support sustainable economic growth in Africa.

As the UAE continues to forge new alliances and investments in Africa’s oil and gas market, its leadership is being recognized not only for its economic prowess but also for its commitment to fostering sustainable development in the region. Through strategic investments in energy projects, the UAE is helping to unlock Africa’s vast natural resources, which in turn plays a significant role in the continent’s economic transformation.

AEW 2025: A Platform for UAE’s Growing Influence in Africa’s Energy Sector

The UAE’s increasing investments in Africa’s oil and gas sector will be showcased at the upcoming African Energy Week (AEW): Invest in African Energies 2025, which will be held in Cape Town. This high-profile event will provide a platform for Emirati and Gulf investors to engage with African energy leaders, discuss strategies for expanding in the region, and explore new opportunities in Africa’s rapidly growing energy market.

AEW 2025 will focus on oil, gas, and clean energy, providing an essential space for key stakeholders like XRG to highlight their investments and initiatives. The event will also feature discussions on the critical role of private investment in unlocking Africa’s energy potential and driving economic growth. As a leading investor in the continent’s energy sector, the UAE’s participation at AEW 2025 will solidify its role as a central player in Africa’s energy future.

In conclusion, the UAE’s growing investments in Africa’s energy sector, particularly in oil and gas, reflect a long-term vision aimed at strengthening economic ties, securing energy resources, and fostering sustainable development. With the continued expansion of its influence, the UAE is poised to become a key partner in Africa’s energy revolution, driving innovation, collaboration, and growth for decades to come.