Last Tuesday, Shell and Gabon’s Ministry of Petroleum signed a memorandum of understanding. Many analysts view this signature as a strong sign of the country’s attractiveness for offshore oil, especially since the British oil giant follows two other major players. Less than a year earlier, ExxonMobil and BP had already shown interest in deepwater oil zones. This suggests that Gabon is once again becoming an appealing destination for large oil companies. However, a closer reading tempers the general enthusiasm.
This document is only a statement of intent, not a firm commitment. There is still a very long road ahead before any oil can actually be extracted and sold. Shell could easily change its mind later: if exploration results are poor, if oil prices drop, or if it finds a more profitable country, the company can walk away without any penalty. This is not the first time Gabon and the British firm have crossed paths. Shell was already present in the country before, leaving in 2017 and permanently in 2019. If it returns now, it is first and foremost because it aligns with its own strategy, not to do Gabon a favor.
And it is precisely on this point that the government holds some leverage. At this stage, it will need to negotiate astutely. What share of the revenue will go to the state? How many jobs and training opportunities for Gabonese citizens? Then comes the question of management. When the money arrives, how will it be safeguarded and used to build the future, rather than spent immediately? For context, commercial production typically takes seven to fifteen years. Budgetary and employment benefits would only be visible between 2033 and 2036 at best. Between seismic campaigns, appraisal drilling, reviving subcontracting chains, and youth employment, there is much to be done.
—
—
Gabon is not the only African country facing this situation. Angola and Nigeria have negotiated in ways that extract maximum benefits from such transactions. Cost recovery thresholds, state share based on profitability, transparency and monitoring — nothing was left to chance. The issue is not attracting Shell; the issue is knowing under what conditions.
While neighboring nations are tightening their rules to turn oil profits, especially from offshore fields, into real development, Gabon appears to be still negotiating with the same tools that led to failures over the past three decades. Shell knows this perfectly well: it signs identical MoUs everywhere. What makes the difference is what the host country demands afterward.
