Cameroun’s floating gas plant departure threatens 2026 economic outlook
The countdown has begun for Cameroon’s economy as the Hilli Episeyo, the floating liquefied natural gas (LNG) facility anchored off Kribi since 2018, prepares to depart national waters in July 2026 when its contract with the national hydrocarbon company (SNH) expires. The National Economic and Financial Committee (CNEF) has flagged this withdrawal as a pivotal factor in the anticipated economic slowdown, alongside geopolitical tensions and declining performance in key export sectors.
Projections from the CNEF indicate that Cameroon’s GDP growth will ease to around 3.2% in 2026, down from 3.5% the previous year, with a further dip to 3.1% in 2027. An alternative scenario in the same report suggests a slightly more optimistic trajectory of 3.3% in 2026 and 3.2% in 2027. In both cases, the extractive sector is expected to drag growth downward, subtracting 0.4 percentage points in both years. The petroleum GDP, encompassing all hydrocarbon-related activities, is projected to contract by 16.1% in 2026 and 18% in 2027.
Declining LNG revenues set the stage for Hilli Episeyo’s exit
The departure of the Hilli Episeyo comes at a challenging time for Cameroon’s LNG sector, which has already seen a steady decline in export earnings. In 2025, revenues from LNG exports totaled 350.2 billion FCFA, a drop from 381 billion FCFA in 2024, 421 billion FCFA in 2023, and a peak of 622 billion FCFA in 2022. The year-on-year decline reached 8.1%. This downward trend continued into early 2026, with total exports falling by 23.6% to 606.9 billion FCFA in the first quarter, while LNG exports plummeted by 28.4% and crude oil exports by 14.4%.
Despite the decline, LNG still accounted for 11.4% of Cameroon’s total export earnings in 2025. The loss of the floating plant will remove a critical revenue stream just as other key sectors falter. During the same period, cocoa and derivative product sales dropped by 37.7%, timber by 11.5%, aluminum by 53.7%, and raw rubber by 16.7%. The compounding declines across sectors amplify the anticipated impact of the LNG shortfall.
Current account deficit widens as fiscal pressures mount
The country’s macroeconomic balances will bear the brunt of the Hilli Episeyo departure. The CNEF forecasts the current account deficit to widen to 5.4% of GDP in 2026 and 6.1% in 2027, up from an estimated 3.2% in 2025. The fiscal deficit is expected to follow a similar path, reaching 1.7% of GDP in 2026 and 2.1% in 2027. These projections also factor in the global trade slowdown, rising freight costs, and modest growth in public revenues.
Rising global oil prices present the government with a familiar dilemma. Keeping pump prices stable would require increased fuel subsidies, placing an immediate strain on the budget. Alternatively, adjusting retail prices could reignite inflation and erode household purchasing power. The CNEF has not taken a definitive stance but emphasizes the limited room for maneuver.
New gas projects fall short of offsetting Hilli Episeyo’s impact
The SNH is banking on upstream diversification to mitigate the loss of the Hilli Episeyo. The most significant project is the cross-border Yoyo-Yolanda field, shared with Equatorial Guinea, with estimated reserves of approximately 2.5 trillion cubic feet and an investment nearing $4 billion. However, progress hinges on finalizing technical and commercial agreements, securing financing, and building dedicated infrastructure.
In parallel, the state-owned company is pushing ahead with the allocation of new exploration blocks in the Rio del Rey and Douala-Kribi-Campo basins. While negotiations for production-sharing contracts are underway, there is no guarantee of commercially viable discoveries or rapid production timelines. The primary risk remains the transition period: the longer the gap between the Hilli Episeyo’s departure and the arrival of new LNG capacity, the deeper the negative impact on Cameroon’s extractive sector growth will be. Current projections suggest none of the announced replacements will be able to compensate for the projected decline in LNG exports in the short term.
