Africa currently accounts for around 8% of global oil supply, according to the African Energy Chamber. That equates to more than six million barrels per day (bpd), with West Africa leading the charge. North Africa follows closely behind.
West Africa is home to some of the continent’s most established hydrocarbon reserves and several of its largest producers, including Nigeria, Ghana, Côte d’Ivoire and Senegal.
Offshore oil dominates the region’s output, contributing roughly 75% of production—unlike North Africa, where over 90% of supply comes from onshore fields.
By the end of 2025, oil production from West Africa is expected to rise by more than 5%, or 200,000 bpd, reaching an estimated 3.9 million bpd.
The increase signals a recovery in upstream activity, particularly in major producers such as Nigeria and Ghana.
Yet, while the spotlight remains on these established players, neighbouring countries like Liberia and Sierra Leone continue their long search for commercial oil.
Despite decades of exploration and early seismic surveys, both nations have yet to secure the breakthrough that could reshape their economies—much like Ghana and Côte d’Ivoire, and more recently, Senegal.
So why has success remained elusive? And what are the prospects for these frontier markets? We answer these questions in this article.
Past exploration efforts and challenges
Liberia’s journey into oil exploration began in the late 1960s, yet its upstream sector remains largely undeveloped, with no commercial discoveries to date.
The country possesses several offshore blocks that stretch from the continental shelf into deepwater zones ranging between 2,500 and 4,500 metres—terrains that demand advanced technology and significant financial investment.
Over the years, Liberia signed production sharing contracts with major international oil companies such as Anadarko, Chevron, Exxon, and African Petroleum.
However, all eventually exited, citing poor prospects and operational challenges.
Sierra Leone’s experience mirrors Liberia’s in many respects. With an estimated 30 billion barrels of oil equivalent—much of it attributed to the Vega prospect—the country initiated exploration activities in the mid-1980s.
Mobil and Amoco drilled two wells between 1984 and 1985, spanning shallow to deepwater zones. Although both wells showed signs of oil, high costs and technical complexities led to their abandonment.
A renewed wave of interest emerged in the 2000s, spurred by 2D seismic data from TGS Geophysical covering over 5,000 kilometers.
Following Sierra Leone’s first offshore licensing round in 2002, Anadarko made notable discoveries, including Venus-1B in 2009 and Mercury-1 shortly thereafter.
Yet, despite extensive seismic analysis and promising wildcat wells, none have yielded commercially viable results.
Nevertheless, both Liberia and Sierra Leone remain hopeful, continuing their pursuit of transformative oil finds.
Analysts point to offshore successes in Ghana and Côte d’Ivoire as sources of encouragement, though they caution that replicating such breakthroughs may be difficult.
Sylvester Ogbolu-Otutu, a natural resources policy and development finance strategist, told Energy in Africa, “Ghana was good for Tullow initially, but the area (Ghana and Cote d’Ivoire) did not become a hot-spot offshore oil and gas basin to attract a huge rush like we have seen in Guyana presently.”
“If there had been a rush based on proven reserves in billions, then it would have been possible for the IOCs to take a calculated risky bet on Liberia and Sierra Leone.”
How similar are both geological landscapes?
Liberia and Sierra Leone are situated within the ancient West African Craton; a stable continental crust that dates back billions of years.
Their geological foundations are dominated by Archean-aged rocks (3.5 to 2.5 billion years old), notably tonalite-trondhjemite-granodiorite (TTG) gneisses.
These rocks form the cratonic core and serve as key indicators of early continental formation.
Offshore, both countries share basins that are part of the South Atlantic passive margin, shaped by rifting and complex sedimentation processes.
These basins exhibit similar thermal histories, lithological contrasts, and deepwater petroleum systems.
Geochemical analyses of offshore wells (such as Montserrado-1 in Liberia and Venus-1B in Sierra Leone) reveal comparable characteristics:
- Source rock types (Type II marine kerogen)
- Maturity levels
- Thermogenic gas signatures
This not only suggests similar petroleum generation potential but also highlights that both basins are geologically “conjugate” to those of Suriname and Guyana.
In geological terms, this means they were once part of the same landmass before continental drift separated them, resulting in mirrored sedimentary and structural features.
The success of discoveries like Liza, Jethro, and Zaedyus in Guyana and Suriname has reignited interest in the offshore blocks of Sierra Leone and Liberia, which are now considered geologically promising.
TotalEnergies shares this optimism and has expressed plans to acquire a 3D seismic survey in Liberia’s neighboring waters.
“These areas hold significant potential for prospects that have the potential for large-scale discoveries that lead to cost-effective, low-emission developments, leveraging the company’s proven expertise in deepwater operations,” said Kevin McLachlan, Senior Vice-President Exploration at TotalEnergies.
Political and economic challenges
Socio-economic realities have played a decisive role in shaping the path of oil exploration in Liberia and Sierra Leone.
In Liberia, the Petroleum Regulatory Authority (LPRA) has made commendable progress in establishing transparent regulatory frameworks.
However, past inconsistencies and unclear licensing processes have discouraged long-term investment.
Attracting competent operators requires more than favorable contract terms; it demands a stable and capable regulatory environment—something Liberia is still in the process of building.
Volatile global oil prices further complicate the investment landscape. For frontier markets with high exploration risks, such fluctuations make it difficult for investors to commit capital.
This challenge is compounded by a broader shift among Western oil companies, many of which are divesting from fossil fuels to align with the global energy transition narrative.
“Both countries need predictable oil and gas policy frameworks. They need to study the experiences of other African countries (Nigeria, Ghana, Angola, and Mauritania),” Ogbolu-Otutu stated.
“They need to focus on monetization of gas from the outset, and incentivizing production sharing contracts by offering favorable tax policies for early entrants, which can be reformed after about 10 years after attracting the strong IOC players.”
Sierra Leone faces its own set of hurdles.
A history of political instability and weak governance structures has made the country a high-risk proposition for oil companies. The Ebola outbreak in 2014 and the COVID-19 pandemic further disrupted exploration efforts and eroded investor confidence.
“Investors could not go in because of instability. Risk perception was too high for the international oil companies (the likes of Shell, Total, ExxonMobil, etc) to risk their financial resources on high risk, capital intensive oil and gas exploration,” Ogbolu-Otutu added.
Current developments and strategic outlook
In 2022, Sierra Leone launched its fifth offshore licensing round during the African Energy Summit in London, signaling a renewed effort to attract serious international investment.
Compared to previous rounds—particularly the fourth—the 2022 offering introduced several strategic incentives:
- 56 offshore blocks spanning over 63,000 km² of open acreage
- A streamlined 10-step licensing process, including prequalification, negotiation, and provisional licensing, designed to reduce bureaucracy and enhance transparency
- A minimum of three blocks per contract area, encouraging oil companies to commit to larger-scale operations
- Extended bidding deadlines to accommodate rising global oil prices, allowing more time for geological and geophysical assessments
In a further bid to boost investor confidence, the government is preparing to launch Sierra Leone’s first-ever National Oil Company (NOC), signaling its intent to evolve from a speculative frontier into a structured and credible business environment.
Liberia, by contrast, had remained relatively quiet in oil sector developments until recently, when TotalEnergies announced plans to resume exploration in its offshore waters.
This month, the French oil major signed production sharing contracts (PSCs) for four exploration blocks—LB-6, LB-11, LB-17, and LB-29—located in the southern Liberia Basin.
“Entering these blocks aligns with our strategy of diversifying our exploration portfolio in high-potential new oil-prone basins,” said Kevin McLachlan, Senior Vice-President Exploration at TotalEnergies.
The four blocks, covering approximately 12,700 square kilometers, were awarded through direct negotiation in 2024 by the Liberia Petroleum Regulatory Agency.
Notably, both Sierra Leone and Liberia have used direct negotiation licensing rounds over competitive bidding in recent years. While this approach is not without controversy, it offers strategic advantages.
Governments can directly engage with companies that possess the technical expertise and financial strength required for exploration.
It also allows for more flexible contract terms tailored to national priorities and investor needs.
Potential economic impacts of commercial petroleum
Commercial oil and gas hold significant potential to reshape the economies of Liberia and Sierra Leone.
Typically, oil and gas development attracts international investments through foreign direct investment (FDI) and development financing—both crucial for economic growth.
However, in the case of these two West African nations, the absence of domestic infrastructure for exploration and refining has led to heavy reliance on imports and foreign expertise, driving up costs and operational complexity.
Sierra Leone, which currently imports all its fuel products, continues to grapple with electricity shortages and mounting financial strain.
In June, Turkish power company Karpowership threatened to cut power supply over $100 million in arrears that have persisted for years.
Liberia faces similar challenges. A lack of domestic energy supply has left millions increasingly dependent on imports, making the country one of Africa’s largest importers of solar products.
Compounding the situation, the indefinite suspension of the U.S.-funded Power Africa initiative by President Donald Trump in March has further stalled progress. The initiative was designed to expand mini- and off-grid renewable power in several African countries, including Liberia.
Daniel Bassey, a renewable energy advocate at Nigeria-based Bavijas Energy Club, said, “Liberia and Sierra Leone haven’t been the most stable of places for oil companies to commit their investments.”
“What would help these countries is to focus on other cleaner sources of energy, which are cheaper—in money, health, and posterity—than crude oil. Crude oil discovery often comes alongside the ‘Dutch disease phenomena’—where the economy over focuses on oil at the expense of other commerce.”
On the other hand, Ogbolo-Otutu believes that beyond prestige, achieving oil-producing status could grant both countries economic and diplomatic leverage.
“It would give them a voice in places like OPEC, APPO, IEA, etc., and the diplomatic clout to engage in discussions with big/rich countries that are interested in securing oil and gas resources in Africa,” he said.
Still, whichever country strikes commercial oil first may trigger both heightened tensions and opportunities for collaboration, given their shared borders and intertwined economic aspirations.
The bottom line
The combination of deepwater technical demands, investor fatigue, and a lack of proven reserves has made exploration a costly gamble for investors in Sierra Leone and Liberia.
With no producing oil fields, analysts argue that it’s difficult to justify the high upfront costs required for development. Moreover, neither nation appears to have the financial muscle to undertake oil and gas exploration independently.
Over the years, however, regulatory oversight in both countries has evolved in an effort to improve transparency and attract investment.
If anything, it has become clear to both governments that foreign oil companies are wary of unpredictable petroleum policy frameworks, which only heighten risk.
Liberia, for instance, implemented major reforms between 2014 and 2016, repealing outdated laws in its oil industry.
Similarly, Sierra Leone introduced investor protections to shield stakeholders from abrupt changes in government policy.
Overall, both African neighbours must continue to wait; hoping that one day, their offshore blocks will yield the breakthrough that has long eluded them.
