Rwanda Set to Become Africa’s Newest Oil-Producing Nation After Fresh Discovery

This oil discovery marks a significant milestone in the country’s efforts to diversify its economy beyond traditional sectors like agriculture and tourism.

Currently, Rwanda’s economy heavily relies on agricultural, and mineral exports, plus its thriving tourism industry.

However, the discovery of oil aligns with the government’s strategy to expand revenue sources through the exploitation of hydrocarbons and mining resources.

Rwanda’s extractive industries currently contribute about 2% to the nation’s GDP, according to its statistical agency.

The country has also made notable contributions to global mineral markets.

According to the United States Department of Commerce, Rwanda accounted for 31% of the world’s tungsten exports and 14% of global tin exports in 2022.

The country also contributed 5% to global exports of niobium, tantalum, and vanadium. Additionally, Rwanda’s gold exports that year were valued at $555.7 million.

This newfound oil discovery could further bolster Rwanda’s growing presence in the global extractive industry and significantly enhance its economic prospects.

Currently, Rwanda imports all its petroleum product requirements due to the absence of local production.

However, with this recent discovery, the country is poised to join the ranks of Africa’s oil-producing nations, alongside major players like Algeria, Nigeria, and Egypt.

The Rwanda Mines, Petroleum and Gas Board announced in a statement that the 2D Seismic Survey (2021-2022) commissioned by the board has shown that Lake Kivu has potential for hydrocarbon resources.

“It also identified thirteen (13) structural pockets and potential drilling locations to confirm the presence and nature of hydrocarbons. In light of the foregoing, RMB is pitching for relevant potential actors to participate in further stages of exploration, development and production of oil and gas of Lake Kivu basin.” the statement added

There is growing “confidence” in discovering more oil reserves, the board’s CEO, Francis Kamanzi noted, citing significant findings in neighboring Uganda and the Democratic Republic of Congo (DRC) within the Great Lakes region.

Rwanda has been conducting tests and exploratory digs in Lake Kivu for over a decade.

In 2017, the governments of Rwanda and the DRC signed a cooperative agreement for the exploration of cross-border hydrocarbon resources and the exploitation of shared deposits in Lake Kivu.

In 2021, Rwanda announced the discovery of a field in Lake Kivu, estimated to hold millions of tonnes of crude oil and natural gas reserves.

The country has already begun tapping into the area’s methane gas, securing a $400 million agreement with Gasmeth Energy to extract and process the gas into compressed natural gas (CNG) for cooking, industrial applications, and vehicular use.