ANALYSIS-Oil firms overlook risks in scramble for Africa

By Tom Bergin

LONDON, May 23 (Reuters) - International oil firms have been scrambling for Africa in recent years, but in their hunger for reserves they may be taking greater risks than they realise, raising the prospect of a rush for the door in the future.

A record 106 oil and gas exploration licences were awarded in Sub-Saharan Africa in 2006, and the figure could be surpassed in 2007, international energy consultants Wood Mackenzie said in an annual review of the African oil industry.

The tens of billions of dollars flowing into the continent's oil industry partly reflects a global surge in exploration prompted by high oil prices.

For Western and Asian oil companies, Africa has a special attraction. They are far more welcome there than in most other places in the current trend towards resource nationalism.

"There has been an influx of investment into Africa and very much because the world's other major oil provinces are not open or are open on much more restrictive terms," said Kevin Rosser, head of the Oil and Gas Practice at consultants Control Risks.

The holders of the world's biggest oil reserves in the Middle East, such as Saudi Arabia and Kuwait, have been hostile to investment from foreign oil companies for decades.

The Kremlin's drive to bring the Russian natural resources sector back under state control and the nationalisation of oil and gas fields in South America make investment in these regions difficult, while Europe and the U.S. offer diminishing opportunities.

This makes Africa one of the few bright spots on the globe for oil investors.