By Paul Sinclair, Vice President of Energy & Director of Government Relations – Green Energy Africa Summit and Africa Oil Week (www.Africa-OilWeek.com) The events of the past two years have accelerated mergers & acquisitions trends in Africa, and 2022 is already witnessing increased deals activity. The continent has now positioned itself as a driver of […]African Oil and Gas Deals: Mergers and Acquisitions Activity on the rise in Africa (By Paul Sinclair) — Database of Press Releases related to Africa – APO-Source
By NJ Ayuk, Chairman, African Energy Chamber After three days in Glasgow for COP26, you can’t help but ask yourself where do we go from here as an African energy sector. I maintain my disappointment with the global elites for failing to invite the oil and gas industry. Oh well, they invited me. With dire […]Gas-To-Power – An Opportunity that Africa Can’t Toss Away after COP26 (By NJ Ayuk) — Database of Press Releases related to Africa – APO-Source
Source: African Energy Chamber | 5 hours ago
Gas-To-Power – An Opportunity that Africa Can’t Toss Away after COP26 (By NJ Ayuk)
Gas-to-power initiatives — the development and expansion of gas-powered electricity plants — are not new to Africa, but they are building momentum
JOHANNESBURG, South Africa, November 4, 2021/APO Group/ —
By NJ Ayuk, Chairman, African Energy Chamber
After three days in Glasgow for COP26, you can’t help but ask yourself where do we go from here as an African energy sector. I maintain my disappointment with the global elites for failing to invite the oil and gas industry. Oh well, they invited me.
With dire warnings about the impending dangers of climate change clouding the headlines on a daily basis, energy transition from fossil fuels to renewables is a hot topic. Talk of banning fossil fuels altogether floats among the more liberal circles in the United States and Europe as companies scramble to crank out acres of solar cells and plant forests of windmills. In May, the International Energy Agency (IEA) proposed banning any new investment in fossil fuels after 2021, and we’re already seeing significant divestment in oil and gas projects around the globe. I responded to their publicity stunt and I still stand by my response (https://bit.ly/3bIjd4s).[i]
As I said at that time “we live in reality. And today, in real-world Africa, this goal is not feasible. Nor is it advisable”
The threat of climate change is real, and the goal of lessening it is noble, but what is often forgotten in these discussions are the repercussions of a rapid shift from fossil fuels, particularly in developing nations like those in Africa. Countries that have enjoyed over a century of energy development and near-universal electrification did so first by exploiting their own natural resources to the fullest extent possible — a right not everyone has been able to exercise equally. While the developed world can afford to take risks and think about sloughing off old industries, large parts of Africa are still struggling to provide their people with reliable electricity. As a result, industrialization and economic stability have remained out of reach for large swaths of the continent. Education, already a challenge in impoverished communities, is even harder. So is the provision of health care.
These are some of the reasons the African Energy Chamber has become an outspoken advocate for continued natural gas production: Gas-to-power initiatives — the development and expansion of gas-powered electricity plants — are not new to Africa, but they are building momentum. They are a practical way to address energy poverty and they make sense for Africa. This is not the time to pressure African countries to abandon them.
Living in the Dark
It is not an exaggeration to say energy poverty is one of our continent’s most pressing problems: Only 56% of Africa’s population has access to electricity today, and in many places that power is still inadequate and unreliable at best. We address this topic in our recently released report, The State of African Energy 2022.
“Comprehensive energy access across the continent remains a central target, with some 600 million people without access to electricity today,” says the report. “Moreover, households themselves, facing low and inadequate supply of electricity, often rely on highly polluting traditional energy sources such as hard biomass, which constitutes 45% of total primary energy demand in Africa.”
As Africa’s population grows rapidly, the continent cannot sustain the mass burning of its plant life in hearth fires indefinitely, nor can the rest of the world afford to let it. Replicating the bad old days of black coal smoke pouring from tall towers isn’t an option either. Africa needs modern power sources to compete on the world stage and to do its part to fight global climate change. On the surface, renewables sound like the ideal solution — sunshine and wind are certainly plentiful, after all. It would be wonderful to kip a century and turn all of Africa into Black Panther’s Wakanda with the newest green technologies–but this isn’t a movie, and real life is never that simple.
Comprehensive energy access across the continent remains a central target, with some 600 million people without access to electricity today
The Downside of Wind and Solar
Many existing power grids in Africa remain underdeveloped, such that an intermittent supply of energy can threaten the stability of an entire grid. Such is the case in Kenya, which is widely considered to be at the forefront of Africa’s energy transition, building momentum in the renewable sector with the 310 MW Lake Turkana wind farm and 50 MW Garissa solar PV station. Some 15% of Kenya’s installed capacity comes from solar and wind, but as our 2022 Outlook reports, they have experienced severe voltage instability. Better system management, upgraded infrastructure, and long-term power storage technology are needed to solve these problems, but implementing these things on a nationwide or continent-wide scale won’t happen overnight.
Another problem plaguing renewables development is near-complete reliance on overseas manufacturing and expertise. The majority of solar cells and windmills are made in China, like so much else, with most of the rest made in Europe and the USA. Those same countries also provide the primary supply of knowledge, training, and technology for installing, maintaining, and repairing renewable facilities. Economically, this means fewer home-grown jobs for Africans in this sector until such capacity can be developed. It also ensures security of supply in case war or politics cripples the ability to import key materials and workers.
Energy demand across Africa is expected to triple within the next 20 years–faster than anywhere else in the world — as a result of population growth, rising incomes, and rapid urbanization. To meet such rapidly accelerating demand, Africa needs the ability to make use of its existing natural resources and human capital, and to employ tried-and-true solutions that will reliably keep the lights on when the wind won’t blow and the sun won’t shine. Mitigating climate change must remain part of the equation, but the perfect cannot be allowed to be the enemy of the good when so many people are still starting from zero.
Why Gas-to-Power Makes Sense in Africa
When it comes to reliability, fossil fuels remain the standard by which all other energy sources are judged, and natural gas is the cleanest among them by far. All of sub-Saharan Africa could triple its electricity use overnight using only natural gas and still account for only a 1% increase in global emissions, so low is its starting point.
Gas power also pairs better with wind and solar than other clean power sources. Unlike coal, hydro, nuclear, or geothermal generators, gas turbines can power up and down quickly, making them ideal as backup for wind and solar when the weather isn’t cooperating and increasing the reliability of the power supply. Gas turbines require less up-front capital investment than most other generating equipment, and they have the advantage of being modular as well for quicker deployment. Until wind and solar become more reliable, gas has the potential to keep coal out of the fuel supply and displace older, dirtier equipment running on diesel or fuel oil, while ensuring that a growing society’s basic needs are met.
Africa already is seeing the benefits of its growing liquified natural gas (LNG) sector. As the 2022 Outlook reports, LNG-to-power has the potential to help build a resilient, low-emission power infrastructure across the continent.
The report cites promising developments in Ghana:
Ghana is set to commission the first sub-Saharan Africa’s LNG-to-power project at Tema LNG Terminal. A floating regasification unit arrived from China in January 2021 and it will be able to deliver 1.7 million tons of natural gas per year for power generation. Ghana’s electricity consumption remains lower than the average over the sub-Saharan region and far below that of developed countries. Bridge Power project in Tema will have the capacity to produce 400MW of electricity from liquefied natural gas. This is equivalent to the power consumption of 1.6 million average Ghanaian homes.
And this is only one example: From new gas-to-power projects in Tanzania to the construction of gas pipelines in Nigeria, African countries are poised to produce, transport, and harness natural gas to boost their power capacities.
And why shouldn’t they? A total of 25 countries on the continent have proven natural gas reserves, 11 of which are currently generating power from their own domestic production in sub-Saharan Africa. Oil and gas are the largest sources of income for many of these countries and have been for decades, giving Africa a substantial well of experience and expertise among its own population to build on. Ceasing oil and gas development in these markets would be devastating both economically and politically, potentially even leading to government collapse and drastically increased poverty. Allowing Africans to build on what they already have increases social stability and the capacity to further develop technological capability.
Ultimately, Africans deserve the same level of energy access and security that the rest of the world takes for granted. The number of people left behind is simply too large to allow foreign agendas to take viable options off the table. If Africans are to do their part in solving the world’s biggest problems such as climate change, they have to be enabled to control their own destinies and participate on their own terms. Gas-to-power is a means to that end, and a brighter future for Africa could mean a brighter future for us all.
Distributed by APO Group on behalf of African Energy Chamber.
Gas-To-Power – An Opportunity that Africa Can’t Toss Away after COP26 (By NJ Ayuk)
By NJ Ayuk, Executive Chairman, African Energy Chamber (www.EnergyChamber.org)
On May 18, 2021, the International Energy Agency (IEA) released “Net Zero by 2050: A Roadmap for the Global Energy Sector,” which outlines plans for the global energy sector to reach “net zero” greenhouse gas emissions by 2050.
Achieving net zero emissions means the amount of greenhouse gases being emitted into the atmosphere would equal the amount being removed. Achieving this balance, the IEA maintains, would require more than aggressive carbon-capture measures: It would call for a swift and immediate shift from petroleum energy sources to energy provided through naturally replenished sources like wind, water, and solar power.
From an environmental standpoint, this is a great concept.
But we live in reality. And today, in real-world Africa, this goal is not feasible. Nor is it advisable. While I agree with their data on many topics, the IEA’s conclusion is flat-out wrong on this issue. Africa needs oil and gas.
Some of the critical steps in IEA’s roadmap include:
- No new investment in new fossil fuel supply (including oil and gas) after 2021
- No new sales of fossil fuel boilers after 2025
- No new internal combustion engine (ICE) car sales after 2035 globally
- 60% of car sales are electric by 2030, and 50% of heavy truck sales are electric from 2035
These steps assume a lot about the state of the world — assumptions that are faulty, especially for Africa. For one, it will require universal energy access by 2030, meaning that everyone has access to electricity and clean cooking. And with approximately 592 million Africans currently without this access, we’re going to be hard-pressed to flip that switch in less than 10 years.
The IEA’s roadmap to net zero also relies on unprecedented investments in renewables — a substantial boost in clean energy investments from the $1 trillion made over the last five years all the way up to $5 trillion annually by 2030 — and cooperation from policymakers who are unified in their efforts. In this idyllic partnership, our Western counterparts talk a good game. But the fact is, to date, these same Western countries have invested little to no funding into Africa’s renewables space. To our dismay even the International Oil Companies that have tried to accept the IEA’s publicity stunt have little or no renewable projects in Africa.
“For many developing countries, the pathway to net zero without international assistance is not clear,” OPEC wrote in response to IEA’s roadmap release, issuing a “critical assessment” on the very same day. “Technical and financial support is needed to ensure deployment of key technologies and infrastructure. Without greater international co‐operation, global CO2 emissions will not fall to net zero by 2050.”
As I have stated in the past, demonizing energy companies is not a constructive way forward, and ignoring the role that carbon-based fuels have played in driving human progress distorts the public debate. We cannot expect African nations, which together emitted seven times less CO2 than China last year and four times less than the US, according to the Global Carbon Atlas, to undermine their best opportunities for economic development by simply aligning with the Western view of how to tackle carbon emissions.
Creating New Problems
China, meanwhile, appears willing to continue investing in fossil fuel projects in Africa. This means that to keep their nations energized, African governments will have little choice but to partner with China — whose performance is notoriously poor when it comes to environmental protection, despite having signed the Paris climate accord. In this scenario, China will become the most influential entity in the African oil and gas industry. And giving China (or any foreign entity) such a monopoly is a dangerous play.
For the IEA plan to work, no new oil and natural gas fields would be developed. The potential energy security risk here is twofold: Concentrated production means that demand will exceed the supply of traditional fuels, while new energy security issues emerge related to the new technologies such as cybersecurity and a dwindling supply of rare earth and critical minerals. And energy insecurity brings economic insecurity and geopolitical instability.
At the same time, a ban on fossil fuel production would bring about the collapse of many carbon-dependent governments. The oil industry is the primary source of income for many African nations. Without the continuation of petroleum production — or time and opportunities to cultivate new revenue sources — their economies will suffer — along with their citizens.
Interestingly, the very announcement of this roadmap features an admission by IEA Executive Director Fatih Birol that net zero will unhinge socioeconomic structures.
“This gap between rhetoric and action needs to close if we are to have a fighting chance of reaching net zero by 2050 and limiting the rise in global temperatures to 1.5 °C. Doing so requires nothing short of a total transformation of the energy systems that underpin our economies,” Birol wrote.
And many of the world’s economies cannot bear this.
Excellent Points from Australia
Energy officials from Australia, for example — incidentally, one of the IEA member countries — had plenty to say in response.
“There are many, ways to get to net zero, and the IEA just looked at one narrow formula,” said Australian Petroleum Production and Exploration Association chief Andrew McConville. “The IEA report doesn’t take into account future negative emission technologies and offsets from outside the energy sector — two things that are likely to happen and will allow vital and necessary future development of oil and gas fields.”
In urging policymakers to maintain a degree of skepticism about the wisdom of the IEA roadmap, McConville isn’t alone.
“We are bringing emissions down,” stated Angus Taylor, Australia’s Minister for Energy and Emissions Reduction, “but we’re going to do it in a way that ensures we’ve got that affordable power that Australians need.”
Rather than being dictated to by entities abroad, Taylor argued that Australia must proceed at a pace that makes sense locally. And part of these local considerations includes ensuring that people have energy and jobs. The IEA’s call to cease investment in fossil fuels will impede both of these metrics.
“Global gas demand is forecast to grow by 1.5% on average per year out to 2025, providing incentive to ensure our large gas fields … are developed as soon as possible,” said Keith Pitt, Minister for Resources. “Large upcoming offshore developments … will create thousands of new high-wage jobs.”
The same holds true for African countries.
While environmental causes are a major focus in the West, lawmakers in Africa’s developing countries are more concerned with living wages and supplying basic necessities to the continent’s growing population.
The IEA plan amounts to austerity measures that would see Africans leaving petroleum resources in the ground. It would essentially brand poor Africans criminals — or at the very least enemies of the environment — for using fossil fuels.
This is folly. Let’s keep in mind the critical role that natural gas is playing in the global transition to clean energy: It’s an affordable and reliable bridge to renewables. And natural gas is particularly important to Africa. As I’ve written in the past, the African Energy Chamber’s 2021 Africa Energy Outlook report projects that African gas production and consumption are going to rise in the 2020s. As a result, Africa’s natural gas sector will soon be responsible for large-scale job creation, increased opportunities for monetization and economic diversification, and critical gas-to-power initiatives that will bring more Africans reliable electricity. These significant benefits should not be dismissed in the name of achieving net zero emissions on deadline. To tell African countries with gas potential like Mozambique, Tanzania, Equatorial Guinea, Nigeria, Senegal, Libya, Algeria, South Africa, Angola and many others that they cant monetize their gas and rather wait for foreign aid and handouts from their western counterparts makes no sense.
What’s more, we can’t overlook the fact that renewable energy solutions are still young technologies —they are less reliable and more expensive per unit of power than tried-and-true petroleum products. Not only that, but achieving net zero by 2050 would require widespread adoption of technologies that are not even available yet.
Don’t get me wrong: I understand the importance of working toward renewables. I believe they are the future of the energy industry. But the global energy transition must be inclusive, equitable, and just. Unfortunately, the roadmap laid out by the IEA is none of these.
The IEA is a respected institution whose opinions help shape the rhetoric of the global energy market. So instead of mandating these strict guidelines from abroad, the IEA should try working with African countries to find solutions that we can actually abide. At the very least, I encourage the IEA to consider partnerships with African Private sector and financial institutions, whose collaboration with indigenous and international energy stakeholders provides invaluable insight from all sides across the energy industry. The IEA should use its voice to push for what I have always believe Africa needs the most at this time, free markets, personal responsibility, less regulation, low taxes, limited government, individual liberties, and economic empowerment will boost African energy markets and economies.
Africa deserves the chance to capitalize on its own oil and gas to strengthen itself, rather than being bullied onto a path determined by Western institutions that don’t face the same obstacles. We must be able to improve our energy sector by exploring our continent’s full potential in a way that benefits our people.
Distributed by APO Group on behalf of African Energy Chamber.
Net Zero? Not For Africa. Not Yet. Africa Must Fight Energy Poverty with Oil and Gas Development (By NJ Ayuk)
Africanews provides content from APO Group as a service to its readers, but does not edit the articles it publishes.
As part of their commitment to fostering innovation and building digital skills, even in the remotest part of the country, Liquid Intelligent Technologies South Africa (www.Liquid.Tech), today heralded in a new digital dawn in the Eastern Cape with the opening of the first Innovation and Digital Skills Centre (IDSC) in Mthatha. Through this initiative, communities […]Liquid Intelligent Technologies digitally empowers the youth of Mthatha with the opening of their first Innovation and Digital Centre — Database of Press Releases related to Africa – APO-Source
Some African countries consider the EU’s planned carbon border levy to be “protectionist”. That was the upshot of a conference organised by the French government on Tuesday (23 March), which examined the challenges posed by the EU’s upcoming mechanism. EURACTIV France reports.African countries deem EU carbon border levy ‘protectionist’ — Watts Up With That?
Africans need Investment, Infrastructure, Education, Employment and Disease Control, not Foreign Aid
There is New Hope for Africa vs. Old Stagnation – and you can help
Africa is two worlds: the cities, which are growing economically at a fast pace, and the rural poor who lack infrastructure needed for raising themselves above poverty and disease. Between these are fairly prosperous market agricultural areas and unemployed job seekers who inhabit substandard housing encircling cities.
Poverty is prolonged by long-standing wrong attitudes and practices that are so entrenched in our world view that many do not see any other way. The colonial powers failed to develop the needed infrastructure for development except marginally in the cities, so the rural poor remained isolated and stuck in poverty, disease and unemployment. Upon independence, Communists or their puppets replaced colonialists in most of these countries, but continued the same bad practices and attitudes.
Foreign aid has been a disaster for these countries because of the lack of accountability and corruption of local governments. Country leaders kept/keep most of the money and grew/grow extremely wealthy, while at the same time, failing to build roads, railroads, electrical systems, education systems and health facilities, and to develop job opportunities by encouraging investment. Corrupt leaders were/are only accountable to donor nations/organizations and unaccountable to the people. Relying on foreign aid and not the tax base of the country meant there was/is no incentive to encourage investment and to develop infrastructure that would support business expansion and job opportunities.
Communist attitudes toward free markets and propaganda against foreign investment only deepen the tendency to keep these countries poor and under top-down control. At the same time, this situation has fostered violent resistance by factions not favored by the government, which had to be strictly controlled and squashed as it arose. Violence and unrest in any form and government corruption serve to discourage foreign investors as well as charitable organizations that could help raise the health and economy of the rural poor.
Investment and infrastructure are key to economic development and ending extreme poverty. Government to government foreign aid should be stopped immediately except for short-term emergency assistance during disasters, and only with complete accountability about how the money is spent, as well as assurances that the distribution is done fairly. Any foreign assistance for infrastructure projects should involve paying engineering firms directly, not funneling funds through corrupt officials who might pocket most of the money and promise but never deliver results.
African economies have historically been based on agriculture and extraction industries. Most of Africa’s agricultural businesses have been based on small to medium farms, but are profitable only in areas where transportation infrastructure permits access to markets. Development of roads and railroads is important to expand agricultural opportunities and markets. With improved crop varieties and modern agriculture Africa can provide much needed food for the world, but only if markets and ports are accessible.
The exploitation of natural resources by colonial powers without just compensation has been used as an excuse to discourage foreign investment in mining and extraction activities. It is only exploitation if the country and its people do not benefit and profit from the activity. Communist propaganda confuses the two approaches, so that businesses that could benefit the economy are discouraged. Agricultural and extraction industries with their associated infrastructure development can help to raise economies and standards of living by providing jobs and putting an end to high rural unemployment.
In the cities, manufacturing, banking, service, technical and communications industries are rapidly developing in areas where governments have improved business opportunities and practices. Ease of doing business, stable governments with low corruption levels and adequate infrastructure encourage investment that can raise economies. Opportunities and workforce availability make African countries a good place to invest and open new businesses.
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Siemens (www.Siemens.com) today announced it has signed a Memorandum of Understanding (MOU) with the Federal Democratic Republic of Ethiopia to support the government’s objective of becoming a low middle-income country by 2025. The Memorandum of Understanding (MoU) addresses the country’s energy and infrastructure sectors. Other key aspects of the agreement include financing concepts that will… […]
How the US will transform its investment role in Africa with a new $60 billion agency
Business between the US and Africa just took a step forward. Easy to miss amidst the partisan din of the approaching election, the US Senate passed the Better Utilization of Investments Leading to Development (BUILD) Act, and it was signed into law Oct. 5. Despite the strong bipartisan support (93 of 99 senators voted for it) the act has its critics, in particular among libertarian conservatives.
In my view, the BUILD act brings the US-Africa business relationship from underground to above ground and may yet bring it to the cloud.
… to continue reading go to the original article at Quartz Africa