Rwanda is poised to join the ranks of Africa's oil-producing nations after the government officially announced its first oil discovery in Lake Kivu, a natural border with the Democratic Republic of Congo. The discovery, which identifies 13 reservoirs within the lake, 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. 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. The study indicated that Lake Kivu basin has a deep thickness of around 3.5 km with hydrocarbons' occurrences. It also identified thirteen (13) structural pockets and potential drilling locations to confirm the presence and nature of hydrocarbons.
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.
The implications of this discovery are significant, not only for Rwanda's economy but also for the region as a whole. As the country prepares to join the ranks of Africa's oil-producing nations, it is likely to attract new investments, create jobs, and increase its economic influence in the region. The discovery also highlights the importance of regional cooperation in the exploration and exploitation of natural resources.
As Rwanda looks to the future, it is clear that this oil discovery marks a significant turning point in the country's economic development. With careful management and strategic planning, Rwanda can leverage this new resource to drive growth, reduce poverty, and improve the lives of its citizens.