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Congo’s industrial sector is dominated by oil and oil-related services with few linkages to the rest of the economy. Congo is the fifth largest oil producer in sub-Saharan Africa, producing an average of 222.1 thousand barrels of crude oil per day in 2007 and 0.29% of the world total. In 2008, oil sector accounted for 65% of the US$16.41 billion GDP, 85% of government revenue, and 92% of exports. In the early 1980s, rapidly rising oil revenues enabled the government to finance large-scale development projects with GDP growth averaging 5% annually, one of the highest rates in Africa.

According to the 2008 BP Statistical Energy Survey, Rep. of Congo (Brazzaville) had proved oil reserves of 1.94 billion barrels at the end of 2007 or 0.15 % of the world's reserves. The Congo also has large reserves of associated natural gas. Congo is one of the West African countries where Energy Africa is active. Congo contains the fourth largest proven natural gas reserves in sub-Saharan Africa.

In spite of its oil wealth, Congo has experienced budgetary shortfalls as a result of public sector expenditures, slumps in world oil prices (1998-1999), and armed conflicts (1997, 1998-1999, and 2002). Congo's business and administrative infrastructure was badly damaged during the recurrent fighting, increasing the petroleum sector's dominance of the economy (since oil production was not directly harmed by the fighting). Rebel attacks and subsequent shut-downs along the CFCO railway, which runs from the port of Pointe Noire to the capital Brazzaville and the interior, severely curtailed the movement of goods and people.

The downstream oil industry is also an important element in the country's economy. The oil industry is predominantly run by foreign companies and is centered on the coastal city of Pointe Noire where the Congolaise de Raffinage (Coraf) operates the 21,000 bpd Pointe Noire refinery. The refinery has been out of commission for four years and has only recently started operating again.

The labour situation in the Congo is sensitive and investors should consider this. Obligations on employers are considered onerous and political restructuring is largely dictated by organized labour. Despite the potential barriers to investment in the Congolese oil industry, however, the sector is experiencing a period of growth.

Petroleum Law & Legislation

In 1994, a new investment code was introduced to attract foreign investment. The contractual framework in the Congo changed in 1995, with the transformation of the concession system applying to producing fields into a production sharing regime as from January 1, 1996. The N'Kossa field has been governed by a production sharing contract since 1994.

Licensing laws in accordance with Production Sharing Agreements (PSA’s) call for an oil production royalty of 15% with transportation and processing costs reducing the rate to 12-14% and a gas production royalty of 5%. In terms of cost oil recovery, up to 70% of total production is negotiable while exploration costs and operating costs are recoverable. Development costs depreciate and profit oil split is negotiable. Corporate tax is 35%.

Oil & Gas Companies

The Congolese oil sector is dominated by the French parastatal oil company Elf Aquitaine, which accounts for 70% of the country's annual oil production. In second position is the Italian oil firm Agip. Chevron, independent CMS Nomeco, and Exxon Mobil are among the American companies active in petroleum exploration or production.

Key Figures

  • Oil production:301,200 bbl/day(2008)
  • Oil Consumption: 9,000 bbl/day(2008)
  • Oil Exports: 241,100 bbl/day(2007)
  • Oil Imports: 2,136 bbl/day(2007)
  • Oil Proved Reserves: 1.6 billion bbl(2009)
  • Natural Gas Production: 180 million cu m(2008)
  • Natural Gas Consumption: 180 million cu m (2008)
  • Natural Gas Exports: 0 cu m (2008)
  • Natural Gas Imports: 0 cu m (2008)
  • Natural Gas Proved reserves:90.61 billion cu m(2009)

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