• Monday, July 22, 2024
businessday logo


Fossil fuels and Africa’s predicament

fossil fuels

Many countries and international oil companies have introduced targets to achieve net-zero emissions by 2050 but, increasingly, attention is turning to what this would mean for Africa’s oil and gas producing countries like Nigeria.

The European Union is striving to be climate-neutral by 2050 – an economy with net-zero greenhouse gas emissions. This objective is at the heart of the European Green Deal and in line with the EU’s commitment to global climate action under the Paris Agreement.

This means energy transition is gaining speed and Africa’s oil and gas producers require clarity as they join the global race to a net-zero emission future. The energy transition is the departure from fossil fuels to renewables and this has led countries in Asia, Europe and America to set dates for banning internal combustion engine vehicles.

Nevertheless, this meets with the economic benefits of Africa strategically managing its oil and gas industry.

With a population of 1.2 billion, the continent is energy-thirsty because it is home to developing and emerging economies. Africa can embrace clean energy without missing out on a critical means of giving more African households and businesses access to electricity through the use of its vast natural gas reserves. This has also been echoed in a new report published by the African Energy Chamber.

Nigeria, Algeria, Egypt, Tanzania and Libya are among the top 10 producers of natural gas on the continent. Others are Angola, Ghana, Cameroon, Mozambique and the Republic of Congo.

On a continent where millions of families are using traditional, hazardous biomass for cooking, where 600 million people lack access to reliable electricity, we see the idea of leaving valuable oil and, especially, natural gas, in the ground as impractical, unpalatable, and inappropriate.

According to the International Energy Agency (IEA), demand in Africa today is 700 terawatt-hours (TWh) of electricity, with the vast majority, more than 70 percent of the total, derived from North African and South African economies. But the IEA predicted that, by 2040, the fastest demand growth will come from sub-Saharan nations.

In our view, to meet this demand, African countries require a diversified energy mix from fossil fuels such as natural gas to cleaner energy developments across the continent. This is because, while solar power and wind can help provide electricity to fill the current and impending power void, neither of them can furnish feedstock for industry, petrol for transportation, or process heat for manufacturing.

The African Energy Chamber’s newly released African Energy Outlook 2021 says, beyond the calamity created by COVID-19, in the short-term, the drive to curb carbon emissions is one of the conventional oil and gas industry’s biggest challenges, and one of Africa’s, too. We can’t agree more.

We, however, identify two paths that open up for oil producers on the African continent. One is for the continent to expand exploration and production of its vast natural gas and oil reserves to bring electricity, fuel, and financial power to hundreds of millions.

The other path is for the continent to yield to pressure to help achieve climate targets, including outright bans on fossil fuels that would eliminate funding for natural gas projects.

It is our belief that doing what is best for Africa and what is right for the environment are not necessarily mutually exclusive. Some form of balance is always possible.

Africa consumes so little energy now and so, the continent’s emissions from oil and natural gas are minimal. In fact, the World Economic Forum estimates that if all of sub-Saharan Africa tripled its electricity consumption overnight using only natural gas, the additional carbon dioxide (CO­2) would be equivalent to just 1 percent of global emissions.

We reason with NJ Ayuk, executive chairman of South Africa based African Energy Chamber, who noted recently that the road to energy transition might be bumpy for everyone, but the idea of banning all fossil fuels makes it exceptionally treacherous, if not impassable, for Africa.

Curbing emissions is a noble and essential goal. The problems associated with climate change are not something that can be ignored. After all, Africa is considered more vulnerable to the effects of climate change than many other areas, especially since so much of the population depends on regular rainfall to grow food crops.

Fossil fuels are not going away soon. It would be around for at least two or more decades. Nevertheless, we advise that, within this period, Nigeria and other African countries with oil and gas reserves have to quickly create an enabling business environment to fuel their economic and industrial development.

Certainly, rising income and population growth will propel energy demand in Africa. The continent has the fastest growing population in the world and the youngest. Greenhouse gas emissions are likely to increase as well.

However, adhering to an intelligent, modern energy plan that incorporates renewables along with natural gas offers some escape route from sustained greenhouse increase and opens the path to lower carbon emissions future for Africa.