Cameroon’s economic prospects face headwinds as Hilli Episeyo departs

A crucial economic countdown has begun for Cameroon. The Hilli Episeyo, a floating liquefied natural gas (FLNG) unit that has been moored off the coast of Kribi since 2018, is set to leave national waters in July 2026. This departure marks the expiration of the contract between its owner, Golar, and Cameroon’s Société Nationale des Hydrocarbures (SNH). In its economic report for the first quarter of 2026, the National Economic and Financial Committee (CNEF) identifies this withdrawal as a central factor contributing to an anticipated economic slowdown, alongside geopolitical tensions and underperformance in several key export sectors.

According to detailed CNEF projections, Cameroon’s gross domestic product (GDP) is expected to grow by approximately 3.2% in 2026, a decline from 3.5% in 2025, further slowing to 3.1% in 2027. A broader overview within the same document presents a slightly more optimistic trajectory, forecasting 3.3% followed by 3.2%. Under both scenarios, the underlying assessment remains consistent: the extractive sector is poised to drag down overall growth, contributing a negative 0.4 percentage points in each of the two years. Petroleum GDP, which encompasses all hydrocarbon-related activities, is projected to plummet by 16.1% in 2026, followed by an 18% drop in 2027.

LNG sector already contracting ahead of the floating plant’s exit

The impending cessation of the Hilli Episeyo’s operations coincides with an already weakened market. Revenues from liquefied natural gas exports reached 350.2 billion FCFA in 2025, a decrease from 381 billion in 2024, 421 billion in 2023, and a peak of 622 billion in 2022. This represents an 8.1% year-on-year decline. This trend persisted into the beginning of the year: during the first quarter of 2026, Cameroon’s total exports fell by 23.6% to 606.9 billion FCFA, with LNG exports specifically dropping by 28.4%, and crude oil exports by 14.4%.

Despite this decline, LNG still accounted for a significant 11.4% of Cameroon’s export revenues in 2025. The removal of this floating production facility therefore deprives Yaoundé of a foundational asset at a time when other key sectors are also losing momentum. Over the same period, sales of cocoa and derived products plunged by 37.7%, timber exports by 11.5%, aluminum by 53.7%, and raw rubber by 16.7%. This cumulative downturn across multiple sectors amplifies the potential impact of the looming gas shock.

Current account under pressure, delicate budgetary choices ahead

Cameroon’s macroeconomic balances are set to absorb this shock. The CNEF forecasts a current account deficit of 5.4% of GDP in 2026, rising to 6.1% in 2027, compared to an estimated 3.2% in 2025. The budget deficit is expected to follow a similar upward trend, reaching 1.7% and then 2.1% of GDP. These projections also factor in a slowdown in global trade, rising freight costs, and only moderate growth in public revenues.

Furthermore, rising global oil prices present a classic dilemma for the government. Maintaining stable fuel prices at the pump would necessitate increasing fuel subsidies, incurring an immediate budgetary cost. Conversely, adjusting retail prices upwards would likely fuel inflation and erode household purchasing power. The CNEF refrains from recommending a specific course of action but underscores the extremely narrow margin for maneuver.

Yoyo-Yolanda and new blocks: solutions without immediate impact

SNH is actively pursuing a strategy to diversify its upstream portfolio to prepare for the post-Hilli Episeyo era. A key pillar of this strategy is the transnational Yoyo-Yolanda field, shared with Equatorial Guinea, which boasts geological resources estimated at approximately 2,500 billion cubic feet and requires an investment nearing 4 billion dollars. However, the project’s timeline remains contingent upon the finalization of technical and commercial agreements, securing necessary financing, and the construction of dedicated infrastructure.

Concurrently, the state-owned company is moving forward with the allocation of new exploration blocks in the Rio del Rey and Douala-Kribi-Campo basins. Yet, the initiation of production sharing contract negotiations does not guarantee the discovery of commercially viable reserves or their rapid development. The primary risk, therefore, lies in the duration of this transition: the longer the interval between the floating plant’s departure and the activation of new production capacities, the more entrenched the negative contribution of the extractive sector to Cameroon’s economic growth will become. None of the announced initiatives are expected to offset the anticipated short-term decline in LNG exports.