Energy Transition: Africa Must Rethink Problems, Solutions Prescribed by Developed Countries - Africa’s premier report on the oil, gas and energy landscape.

Energy Transition: Africa Must Rethink Problems, Solutions Prescribed by Developed Countries

By Lukman Abolade, Senior Correspondent

Omar Farouk Ibrahim, Secretary General of African Petroleum Producers’ Organization (APPO), says that Africa must rethink the identified problems and solutions prescribed by developed countries in order for the continent to reach its full potential.

“Africa should be original in analysing our situation, take critical look at where we are today and see if the prescription that we are getting from the developed world are the cures for our ailments”. Ibrahim said at a Pan African Oil & Gas conference held in Lagos, Nigeria.

“We ask for example about the global energy transition, who are behind the global paradigm shift, from fossil to renewable energies?”, the APPO chief asked the delegates at the 8th edition of the Sub-Saharan Africa International Petroleum Exhibition and Conference (SAIPEC 2024) organized by the Petroleum Technology Association of Nigeria (PETAN).

“At what point did they got to know about the dangers of fossil fuels? What are they doing to ensure energy security for their own population, what are they asking us to do to ensure energy security for our own people during the transition and after, what are they promising us? These are questions I think need lots of critical analysis, we should not be gullible by just accepting whatever we are told as solutions”.  He said that “answers to these questions will open our eyes to the need for a complete re-evaluation of how best to identify and protect our collective interests as a continent with over 600Million people who have no access to electricity,”

Ibrahim’s audience included Gbenga Komolafe, Chief Executive of the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), Estevao Pale., Chairman of Mozambique’s state hydrocarbon company Empresa Nacional de Hidrocarbonetos (ENH), represented by the Abdulmalik Halilu, Director, Monitoring and Evaluation, at the Nigerian Content Development Monitoring Board (NCDMB), who delivered an address from  Felix Omatsola Ogbe, Executive Secretary, NCDMB, aNick Odinue, President PETAN and some 300 delegates from Uganda, Liberia, Mozambique, Senegal, Brazil, United States and Nigeria.

Ibrahim added that to survive the global energy transition, there is a need for Africa to adopt a new business model. “Africa needs a new energy business model to survive the energy transition, if we go the way the developed countries are directing us to go, we will remain second and third class players in the industry, even in our own countries”.

Austin Avuru, the Chairman of AA Holdings provided an unusual insight to the rise for the call for energy transition, dating it to the Yom Kippur War in 1973 which forced the Arab Oil Embargo, leading  to severe episodes of inflation in countries like the United Kingdom and the United States of America due to scarcity of fossil fuel.

“Energy transition did not start in Paris, it started in 1973, so large scale funding was then directed into renewables to make sure that in a period of time beyond that 1973, the basket of energy available to the Western world will consist of oil and gas and other things that they could control. The 2015 landmark Paris agreement just brought what had started 40 years earlier into the right context that made it so easy to champion energy transition.

“Fast forward to 2021 after the Paris agreement, a number of geopolitical events had just happened, the Russia-Ukraine crisis was just starting, it became clear to all that most of the components of the renewable energies were coming from China, so the Western world is caught in a quagmire between dependent on OPEC oil or dependence on China for renewable energy. Very difficult choice to make. By the time we got to COP 26, COP 28, the language of energy transition had changed, it’s no longer to hell with fossil fuel, it is now energy is energy.

Avuru argued that “the world needs a basket of energy sources to survive, none of it is dirty, we want it to be as clean as possible, the name of the game is geopolitics. What does this mean for Africa? The name of the game is energy security. Energy plays a critical role in driving economic growth, therefore energy transition cannot, for Africa compromise energy security. Therefore we cannot throw away what we have, climate change is an existential threat, true but perhaps for us, a bigger existential threat is institutional poverty, hunger, disease and conflicts, all signs and symbols of under development and poverty. They are bigger existential threat to us than climate change.

. “Therefore what we have we must keep, what we have, we must optimise its value and therefore for us in Africa, we have to ramp up our oil and gas production, just like Commission Chief executive said, we have to drive down our cost and be more efficient and more competitive. We have sufficient refinery capacity, if we are going to double our internal consumption, we have to double our refining capacity. We have to use our oil and gas resources to optimise our manufacturing industrial capacity. We have to intensify our gas to power projects and other uses of gas”.

In 2021, global carbon dioxide emissions totalled approximately 37.12Billion tonnes, more than half of all carbon emissions are produced by the wealthiest 10 percent of the world’s population.

Africa’s carbon emissions are notably lower compared to other continents. China leads as the world’s largest polluter with 11.47Billion tonnes, followed by the United States (5Billion tonnes), India (2.7Billion tonnes), Russia (1.75Billion tonnes), and Japan (1.07Billion tonnes).

Despite comprising about 17 percent of the world’s population, Africa contributes only 4 percent of global carbon emissions, amounting to 1.45Billion tonnes.

Avuru further contented that over 600Million Africans have no access to electricity, which represents over 100Billion dollar opportunity for investors across Africa. While 920Million Africans have no access to clean cooking and 680Million of them cannot afford it, it also represents 9-12Billilon dollar opportunity.

Gbenga Komolafe, Chief Executive Officer, Nigerian Upstream Petroleum Regulatory Commission (NUPRC) said Nigeria can produce 2.26Million barrels per day of crude oil (2.6MMBOPD), adding that while the current quota of the Organisation of Petroleum Exporting Countries (OPEC) for Nigeria is 1.5MMBOPDthe commission has embarked on some strategies to boost the nation’s crude oil production.

He said, “The oil reserves and gas reserves in Nigeria respectively represent 30% and 34% of the African oil and gas reserves. Although the actual national production currently averages 1.33 Million barrels of oil per day and 256,000 barrels of condensate per day, the national technical production potential currently stands at 2.26MillionBPD, and the current OPEC quota is 1.5MillionBPD.

“Thus, the Commission is taking strategic measures to arrest some challenges confronting us to boost production and meet the potential.

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