On 26 July, the military junta led by General Abdourahamane Tchiani and its Conseil National pour la Sauvegarde de la Patrie (CNSP) seized Mohamed Bazoum's government. The economic implications of sanctions can be substantial, particularly regarding the promising oil industry that was about to boost at the end of the year, bringing the production up from the current 20,000 bo/d to approximately 100,000 bo/d.

• Exports at risk: China National Petroleum Corporation (CNPC)'s longest African pipeline was almost ready to export 100,000 bo/d of crude from its dozens of oil fields in the Agadem region in late 2023. The exit point for the crude is Port Seme on Benin's coast. As a member of the ECOWAS regional bloc, Benin could ban the entrance of Niger's crude at the expense of its economic losses from taxes collected from using the route. Benin has reported that works continue after the coup, but commissioning delays may happen. However, it is unclear how the country will satisfy ECOWAS' requirements while opening the export route to the junta.
• Savannah Energy could see its first oil from Niger delayed once again: Savannah has been doing well in Niger, with five discoveries made in 2018 and a high chance of success drilling campaign to be started in the coming years. Following several delays due to a Nigerian gas venture and COVID-19, the British firm plans to start producing oil from the Amdigh field in 2024 to reach 5,000 bo/d. As Savannah is entitled to use the Niger-Benin pipeline, its first income from Niger could also be forced to wait. With the Nigerien coup, Savannah faces two authoritarian governments regarding its African interests, with Chad as the main headbreaker.
• Sonatrach's assets will not be so much affected: The international branch of the Algerian state-owned company Sonatrach, SIPEX, was not yet at the point of exporting crude from its Kafra discoveries in northern Niger. The company expects to drill several development wells in the coming years; therefore, some delays regarding the political situation will not substantially impact the firm unless the conflict escalates into a regional one.

These only international operators in Niger's oil industry, the CNPC, Savannah and SIPEX, will now have to deal with a new Oil Minister, Mr Mahamane Barke, who has already reportedly considered new oil export routes which avoid Benin. With CPNC's pipeline almost commissioned, the simple idea of rejecting this billion-dollar export project sounds illogical. If Bazoum's government is not reinstated, Mr Barke and the China state-owned firm will have to find a diplomatic solution despite geopolitics to make the Nigerien crude flow as soon as possible for the benefit of its citizens.

This article was published by S&P Global Commodity Insights and not by S&P Global Ratings, which is a separately managed division of S&P Global.