NJ Ayuk
Organisations ranging from the World Bank to the European Investment
Bank (EIB) have dropped support for African fossil fuel production in
hopes of ...encouraging a transition from oil, gas and coal to sustainable
energy sources like wind and solar power.
Now there are legitimate concerns that investor support for oil and gas
production will dwindle as well. Blackrock, which controls $7 trillion
in investments, and the Royal Bank of Scotland have said they will be
moving away from investments that support fossil fuel production.
The anti-fossil fuel fervor is being demonstrated in what may seem like
surprising ways: The Bank of England was criticised for having an oil
company executive on its board of directors.
SEE ALSO :Kenya should invest in people and harness technology
Pressure
is coming from within the African continent, as well. Lobbies from
Kenya and the surrounding region, for example, recently petitioned the
African Union to put a stop to coal usage and look into phasing out oil
and gas usage over the next three decades in hopes of eliminating
emissions that contribute to global warming.
I agree that climate change should be taken seriously, but we cannot
accept knee-jerk responses. We must not rob our continent of the
significant benefits it can realise from oil and gas operations, from
the economic opportunities of monetised natural resources to critically
important gas-to-power initiatives.
I am not, by any means, calling for a stop to sustainable energy
programmes. They are being implemented, and I hope to see more. I am
simply saying it is too soon for an either-or approach to green energy
sources and fossil fuels.
What’s more, it should be Africans, not well-meaning outsiders, who
determine when the timing is right to phase out fossil fuels in Africa,
if ever. Pressuring Africa to do otherwise is insulting, no better than
throwing foreign aid at us with the assumption that Africans are
incapable of building a better future for themselves.
It is also hypocritical for countries and people who enjoy the security,
greater life expectancy, comforts and economic opportunities associated
with plentiful, reliable energy to say: “Time’s up, Africa. No more
fossil fuels for you. Desperate times call for desperate measures.”
SEE ALSO :Sudan passes 2020 budget with anticipated deficit of USD1.62 billion
What about the desperation that the 600,000 million-plus Africans without power live with every day?
Is it reasonable to expect them to wait for green energy to evolve while
domestic natural gas and crude oil reserves can be exploited to create
electricity and heating fuel far more quickly?
We cannot move forward with phasing out fossil fuels in Africa before we
address the huge swaths of our continent existing in energy poverty. I
strongly agree with OPEC Secretary General Mohammed Barkindo, who
recently said: “The almost one billion people worldwide who currently
lack access to electricity and the three billion without modern fuels
for cooking are not just statistics on a page. They are real
people... Nobody should be left behind.”
Closer home, more than two-thirds of the population of sub-Saharan
Africa, more than 620 million people, lack access to electricity. Even
more infuriating, that number is likely to increase. The International
Energy Agency (IEA) has predicted that by 2040, approximately 75 per
cent of sub-Saharan Africa will lack access to electricity. Why? Surging
populations are far outpacing the spread of infrastructure.
As I wrote in my 2019 book, Billions at Play: The future of African
energy and doing deals, living without electricity is much more than an
inconvenience. It keeps people from modern healthcare, and it exposes
them to toxic air pollution caused by burning unsafe fuels indoors. It
also reinforces poverty and contributes to economic stagnation.
Businesses, factories and schools need electricity to function and grow.
SEE ALSO :Robust service sector, low prices keep Kenya economy afloat
I
am convinced that one of our continent's best chances of eliminating
energy poverty is to strategically exploit our abundant natural gas
resources instead of exporting and flaring it. Africa had 503.3 trillion
cubic feet of proven natural gas reserves available to us as of 2017.
Natural gas can be used to fuel electricity generation: It is available;
it produces less carbon dioxide emissions than diesel, gasoline or
coal; and it is affordable. In fact, its price recently fell to its
lowest February level in 20 years. What’s more, natural gas can be
integrated with wind and solar power to produce energy that is both
sustainable and reliable.
While gas-to-power will require effort, from the creation of
intra-African trade agreements that make natural gas available to
countries without it to cooperation from power producers, it represents a
very doable way for Africans to resolve one of the continent’s greatest
challenges.
With that in mind, this is a horrible time to stop producing and using natural gas in Africa.
Phasing out fossil fuels in Africa also would be harmful to the many
international and indigenous oil and gas companies that contribute to
the continent’s revenues and make a positive social impact here.
I have written extensively about companies that do real good for African
communities, such as Atlas Oranto Petroleum, Sahara Energy Group,
Aiteo, Seplat, Sonangol, Shoreline Power Company Limited and many, many
more. These indigenous companies create jobs for Africans, buy from
African suppliers, and do business with other African companies in
addition to their extensive community outreach efforts. We have, and
need, foreign companies that do the same—and share their technologies.
SEE ALSO :Five counties to share Sh10b WB fund for fisheries project
And
that is only part of the picture. Africa has not fully capitalised on a
game-changing opportunity: Monetising our oil and gas resources. This
starts with using oil and gas as a feed stock to create other
value-added products. Natural gas, for example, can be used to make
liquid transport fuels, base oils, paraffin, and naphtha. The resulting
revenues can be used to build infrastructure and diversify economies.
This is not an abstract, pie in the sky idea. In Equatorial Guinea, for
example, initiatives aimed at monetising the country’s massive natural
gas reserves has led to the creation of new infrastructure. It is
helping the government build a natural gas mega hub that could make
Equatorial Guinea a major player in the global liquefied natural gas
market and bring in $2 billion in revenues. There is no reason that
other African countries cannot do the same.
Our view on oil and gas is not about greed or lining the pockets of a
select few. If we work to use these resources wisely, they really can
power a better future for Africa. And we’re not ready to toss them
aside.
Mr Ayuk is Executive Chairman of the African Energy Chamber and CEO
of pan-African corporate law conglomerate Centurion Law Group. Article
distributed by APO Group on behalf of African Energy Chamber
No comments:
Post a Comment