LNG Supply Surge Forces Africa to Rethink Export-Heavy Gas Strategy

 

A sharp expansion in global liquefied natural gas capacity from 2027 is set to reshape energy markets, intensifying price pressure and compelling gas-producing regions, including Africa, to reassess their reliance on exports.

Bloomberg’s Global LNG Market Outlook 2030 estimates global LNG supply will rise to 594 million metric tons by the end of the decade, up 42% from 2024, leaving international markets facing a potential oversupply of about 15 million tons. Although geopolitical tensions and construction delays could narrow that gap, analysts caution that a sustained surplus would squeeze exporter margins and heighten volatility.

For Africa, the projected glut is sharpening focus on a long-standing vulnerability: weak domestic gas value chains.

Gas output on the continent is climbing as new LNG projects come onstream in both North and sub-Saharan Africa. North Africa currently produces about two-thirds of Africa’s gas, but its share is expected to fall to 40% by 2035 as sub-Saharan production accelerates, according to the African Energy Chamber’s State of African Energy 2026 Outlook. By 2050, sub-Saharan LNG supply could be four times current levels, while African gas demand is projected to increase 60%, from 55 billion cubic meters in 2020 to roughly 90 bcm.

Yet exports continue to dominate. Sparse pipeline networks, limited transmission capacity and underdeveloped processing and storage infrastructure constrain domestic consumption, making LNG exports the most commercially viable option. Export-oriented projects are typically supported by long-term offtake contracts and international financing, while domestic infrastructure depends on government backing, credit enhancements and patient capital that remain harder to mobilize.

Still, signs of a shift are emerging. LNG terminals designed to serve domestic and regional markets are under development at Richards Bay in South Africa and the Port of Nador in Morocco. Ethiopia has also signed an agreement to advance a Gas-by-Rail Economic Corridor, a 75,000-kilometer freight rail network intended to transport LNG to more than 40 sub-Saharan countries.

Large-scale pipeline and power projects are gaining traction. These include the proposed $25 billion Nigeria-Morocco Gas Pipeline, the Trans-Saharan Gas Pipeline linking Nigeria and Algeria, and a $1.5 billion Mozambique-Zambia pipeline announced in 2025. Senegal is building a phased gas network connecting offshore production to power plants and industrial zones, while Ghana plans five petrochemical plants to supply fertilizers, lubricants and other industrial inputs.

Gas-to-power is increasingly central to national energy strategies. The African Energy Chamber projects natural gas will account for 45% of Africa’s electricity generation by 2050, with countries such as Nigeria, South Africa, Angola, Senegal, Ghana and Mozambique positioning gas as a bridge fuel to expand power access and support industrial growth.

“Export projects alone will not secure Africa’s energy future,” said NJ Ayuk, executive chairman of the African Energy Chamber. “Strategic investment in gas infrastructure will determine whether rising production translates into electricity access, industrial capacity and economic resilience.”

As global LNG markets become more competitive, Africa’s ability to anchor gas production in domestic power, industry and regional trade is increasingly seen as critical to insulating the continent from external shocks and converting resource wealth into sustainable economic gains.