Navigating Africa Energy Week: Strategic Imperatives for Investors and Developers

At Africa Energy Week (AEW) the spotlight once again falls on the continent’s vast energy potential—and the strategic challenges that accompany it. For mining houses, infrastructure developers, financiers, and agricultural operators, AEW is a platform to align business ambitions with Africa’s evolving energy and sustainability agenda.

Energy Security Meets ESG Reality

Across Africa, electricity demand continues to climb, with many nations pursuing ambitious renewable energy programmes alongside traditional oil and gas projects. Yet investors and operators face a dual challenge: delivering reliable energy and meeting rising expectations around environmental, social, and governance (ESG) standards.

This challenge is most pertinent to the use of natural gas in energy generation as a bridging fuel where domestic natural gas exploration and gas-to-power projects have been challenged by certain environmental NGOs citing climate change and the decreasing cost of renewables as the key reasons for shifting directly to 100% renewable power with battery storage. This pathway, however, faces significant practical challenges including grid stability, high up-front costs, intermittency management and the need for massive infrastructure upgrades.

Critics argue that switching solely to renewable power over-simplifies a complex energy ecosystem contingent on unrealistic assumptions, speculative technologies, economic viability and the need for dispatchable back-up power particularly in peak demand scenarios. Furthermore, switching solely to renewable power (something no other country has done) would require an aggressive policy shift from the current diversified energy mix contemplated in most government energy policies.

Despite this, it seems that legal challenges will frustrate efforts to expand energy access and transition from higher‑carbon fuels and bridging fuels—particularly oil and gas.

Strategic Risks for Bridging Fuel Projects: Permitting & Licence Challenges to Watch

Recent court rulings, regulatory pushback, and community resistance demonstrate that the risks around permits and licences for such projects are growing. For investors, developers, and operators considering oil and gas projects, paying close attention to these risks is essential.

Below are key risks emerging, illustrated with recent examples, followed by strategic recommendations for navigating the licence and permit landscape safely and effectively.

Key Risks: Permits & Licenses for Bridging Fuel Projects

Risk	Description	Recent Examples
Legal challenges to environmental authorisation authorizing bridging fuel projects	Bridging fuel projects’ environmental assessments or authorisations are challenged for allegedly failing to address risks such as lifecycle GHG emissions, climate change, need and desirability of bridging fuel projects, cumulative impacts, transboundary impacts factors or because public consultation was inadequate.	South Africa: Legal challenges to Shell’s exploration right off the Eastern Coast of South Africa, the challenges to TotalEnergies’ and Shell’s environmental authorisations for offshore exploration drilling of the South African west coast and the Supreme Court of Appeal’s decision in respect of Eskom’s gas power plant permit in Richards Bay.
Inadequate Public / Community Consultation and Socio‑Economic Assessment	Communities affected by oil and gas projects are increasingly asserting their rights. Weak consultation processes or poor socio‑economic risk assessment often trigger lawsuits and blocks.	Senegal: Grand Tortue Ahmeyim LNG project faced concerns about fishing disruption and consultation.
Failing to Incorporate Climate Change Impacts / Emissions in Licensing	Governments, courts, and civil society are pushing for assessments to consider downstream emissions and climate risks.	South Africa: The courts have considered the need for lifecycle GHG emissions in the context of exploration projects, holding that when assessing the needs and desirability of a project, the decision-makers cannot rely on the benefits of downstream uses of natural gas without considering the negative impacts. With exploration projects, it is impossible to assess the downstream impacts as the nature of the resource is unknown and there are various downstream uses each with their own GHG profile. As a result, exploration projects should restrict the focus to the benefits and disadvantages of the exploration activities themselves.
Delays & Uncertainty in Licensing & Permit Processes	Projects often face delays in obtaining key permits due to overlapping jurisdictions, litigation, and regulatory backlogs.	Namibia: Delayed work permits stalling oil and gas sector. Nigeria: Regulatory backlog in converting prospecting licences causing uncertainty.
Policy & Licence Round Cancellations or Reforms	Governments sometimes cancel or reform licensing rounds mid‑stream, introducing policy and regulatory risk.	DRC: Controversy over oil/gas bids in ecologically sensitive areas. Republic of Congo: Cancelled licensing round for 27 oil blocks due to irregularities.

Implications of These Risks

Legal challenges to bridging fuel projects can derail government energy transition plans which, in turn, may result in:

• less foreign direct investment because investors will be less inclined to invest in countries where the return on investment may not arise and/or is significantly delayed through litigation. As a result, investors may look to other countries with less red tape and/or less active objectors to fossil-fuel related projects.
• slower economic development as energy is critical to industry development and job creation.
• changes in government policy regarding the energy mix. This may include extending the life of coal fired power stations beyond their proposed shut down dates because reliable baseload and peaking power options are not available which, in turn, could impact those countries’ ability to comply with their international commitments to reduce greenhouse gas emissions. It may also result in the fast-tracking the implementation of other technologies, such as green hydrogen, to support the energy supply. However, this may also require the use of technologies (such as open-cycle gas turbines) that are often opposed by opponents of fossil fuel consumption.
• the loss of the opportunity for developing countries to benefits from domestic natural gas / oil reserves to boost economic development for so long as fossil fuels are still required as a viable energy source.

It is acknowledged that there is a need to actively reduce greenhouse gas emissions to maintain the 1.5°/2°C pathway. While all states and companies need to play their part in doing so, the greater obligation falls on developed nations. Developing countries will be further prejudiced if they are prevented (through prolonged legal challenges) from directly or indirectly benefitting from their indigenous resources during this transitional period.

Strategic Recommendations: What to Do Differently

To mitigate these risks and increase the probability of successfully procuring and defending licences:

1. Conduct robust environmental, social & climate risk assessments

Environmental assessment practitioners that are well versed in the relevant sectors will provide independent and legally robust environmental impact assessments. Legal input is also critical. Experienced practitioners in the field are aware of potential legal challenges and provide guidance on the ways in which environmental assessments must be enhanced for extended to ensure that all legal issues are suitably considered and assessed. This is particularly relevant in relation to issues regarding international and local legislation such as transboundary impacts and lifecycle greenhouse gas emissions.

2. Ensure meaningful public & stakeholder consultation

Inadequate public consultation is often a ground of both appeal and judicial review proceedings because legislation generally does not prescribe the way public participation process must be conducted.

Legislation is not prescriptive to allow engagement process to be flexible taking into consideration the nature of the project and identity of the various stakeholders. It is the responsibility of the person undertaking the consultation process to design a process that reasonably notifies all interested and affected parties and affords them a reasonable opportunity to meaningfully participate and, in limited instances, obtain free prior informed consent.

We have seen extensive consultation processes (going well beyond the legal and best practice requirements contemplated under international guidelines) challenged for failing to identify relevant stakeholders, notifying them of the opportunity to participate in a language they understand and giving them a reasonable opportunity to comment on the information regarding the proposed project. The way this information is packaged and shared with stakeholders is critical.

Non-technical documents summarizing the project and the key themes are helpful. However, there are opportunities to further develop the way these documents are presented to aid stakeholders. Impactful past practices / processes can stakeholder engagement and document production and disclosure, however, these processes should be stress-tested for the project under investigation to ensure it is appropriate. Regular reviews of the consultation process should be undertaken throughout the process to establish whether the objectives of meaningful participation are being achieved.

3. Comply Fully with Procedural Requirements

It goes without saying that fastidious procedural compliance is needed to avoid successful legal challenges. In South Africa, for example, environmental authorisations have been challenged on the basis that the section 63 requirements under the National Environmental Management: Integrated Coastal

Management Act requirements in respect of projects within the coastal environment were not adequately addressed. It was argued that these requirements go beyond the traditional environmental impact assessment criteria. Understanding these legal requirements and commenting on draft environmental impact assessment reports assists in developing robust, procedurally compliant reports. Like public with the stakeholder engagement, regular reviews of these procedures should be conducted throughout the process to confirm that all the relevant requirements have been met.

4. Monitor and adapt to policy & legal developments

Considering the rate at which new technology is being developed in the energy sector, particularly in the renewable and battery storage market, it is likely that government policies may fall behind actual market conditions. As a result, government and proponents alike need to scrutinize policy during the project approval process. In determining if a project is needed and desirable, proponents and government officials alike must not only consider if the project aligns with government policy but also if the policy aligns with current conditions. In both instances, justifiable explanations are required when adhering to or deviating from policy.

It is likely, particularly in respect of fossil fuel projects, that policy may offer conflicting or competing objectives. The obvious example is climate change and greenhouse gas emission policies versus energy generation and economic development policies. Alignment with all policies may be impossible. Compliance with policy, however, is not a legal requirement. All that is required, is that all policies are considered and assessed and the ultimate decision to approve or reject an application for an authorization is justifiable. Understanding where a proposed project does not align with government policy and providing a suitable basis for this misalignment is important. However, environmental consultants tasked with preparing environmental impact reports may not wish to provide such a basis because it would challenge their obligation to remain independent. To navigate this complexity, proponents may wish to provide their rationale for the project which is recorded as such by the consultants.

5. Design permits and licenses with ESG & stakeholders in mind

Climate change and greenhouse gas emission reduction obligations is the primary challenge to fossil fuel-based energy projects. Taking this into consideration, proponents may want to offer offsets as part of their projects to reduce the overall impacts of the project, making it more enticing to investors and more acceptable to environmental groups who oppose these projects on principle. As set out above, there are arguments supporting the need for fossil fuel projects. However, if proponents want to differentiate themselves from other fossil fuel applicants, incorporating offset projects into the project design may deter objectors and remove grounds upon which to challenge authorisations granted for the project.

6. Build permitting & licensing challenges time into project planning

Legal challenges can significantly delay project planning timelines. Incorporating these challenges into overall project timeline can provide realistic project trajectories. As many licences and permits have limited lifespans, it is important to ensure that proponents prevent these licences from lapsing or expiring where commencement is delayed due to legal challenge. Protracted legal challenges to projects can impact project viability and delay the various benefits that could arise if projects are implemented sooner. Engaging with key objectors during the project design may extend the project preparation timelines, it may avoid legal challenges down the line.

In legal proceedings, the production of the record on which decisions are made, often delays the finalization of legal proceedings. State parties need to develop and implement measures to provide these documents more quickly to ensure that the administration of justice and the finalization of legal matters is done efficiently. In many jurisdictions, alternative disputes and mandatory mediation methods are being implemented to assist in this regard.

Conclusion

Africa Energy Week highlights both the urgency and the opportunity in Africa’s energy transition. While the promise of bridging fuels such as natural gas remains significant, the growing intensity of legal, regulatory, and stakeholder challenges cannot be underestimated. For investors and developers, success will not come from treating permitting and licensing risks as procedural hurdles, but from embedding them into strategic planning as central, long-term considerations.

The path forward requires balancing Africa’s developmental priorities with climate imperatives, designing projects that anticipate scrutiny, and building partnerships that reinforce credibility with regulators, communities, and financiers alike. Those who invest in robust assessments, adaptive engagement, and innovative project design will not only safeguard their licences but also secure first-mover advantage in a region where energy demand is rising and infrastructure gaps remain vast.

In short, the winners of Africa’s energy transition will be those who treat risk not as a barrier, but as a catalyst for more resilient, bankable, and sustainable projects.