Africa-based social enterprise, Oxygen Hub, is building 100 medical oxygen producing plants in Africa and one of the first three plants earmarked for Nigeria will open on Tuesday, July 13, in Nasarawa State.
The mission of Oxygen Hub, which is supported by leading impact organizations including Skoll Foundation and ELMA Philanthropies, is to close the huge gap in medical oxygen supply on the continent, boosting survival of patients who face increased vulnerability from COVID-19 pandemic.
Each oxygen manufacturing plant cost upwards of $120,000. But that figure rises to between $600,000 – $700,000 when investments in oxygen storage cylinders, a delivery truck, diesel generator, the physical site (and construction in most cases) as well as other accessories are considered.
The model is to build the oxygen plant under an innovative franchising partnership which will allow franchisees to pay back within ten years or more.
According to Effeson Hailemichael, chief executive of Oxygen Hub, the Nasarawa plant being commissioned on July 13 will be positioned to supply badly-needed medical oxygen to hospitals and health centres in central Nigeria, including Abuja, the nation’s capital.
Hailemichael told BusinessDay that the company uses innovative business models to bring affordable life-saving tools to Africa where up to 90 percent of the medical oxygen need has remained unmet for decades.
According to him, two other plants are also being commissioned in Kenya and Ethiopia.
Noha El-Ghobashy, chief executive, Institute for Transformative Technologies, the firm’s backers, said apart from arranging financing and building of medical oxygen plants, Oxygen Hub will also provide prompt maintenance and affordable technologies to ensure the plants run with minimal time.
“Our business model is to create sustainable businesses that support Africans to solve Africa’s problems” El-Ghobashy said, noting that through a decentralised strategy, Oxygen Hub will get oxygen to wherever it’s needed on the continent.
Sub-Saharan Africa (SSA) has historically suffered from an acute shortage of medical oxygen, with most countries in the region unable to access more than 10 percent of the volume needed to treat high-burden conditions such as pneumonia, chronic obstructive pulmonary disease (COPD) and neonatal respiratory syndrome among others.
COVID-19 has both exacerbated and highlighted this oxygen supply gap.
Over the years, the most common method of supply in SSA has been in the form of cylinders filled with oxygen gas from cryogenic distillation plants that produce liquid oxygen1 (LOX). Most of these factories were built decades back to serve industrial applications—particularly extractives.
To date, they continue to focus heavily on those applications and have served only a fraction of the existing need for medical applications.
More recently, smaller pressure swing adsorption (PSA) 2 plants have emerged as an alternative to cryogenic plants.
However, these systems have often not been adequately maintained, and a sizable portion of them are not currently operational. Unsurprisingly, the existing medical oxygen capacity in SSA has been insufficient to meet the surge needed for COVID-19.
COVID has increased awareness about the importance of oxygen and has generated strong interest from governments, investors, and other influential stakeholders to significantly and sustainably increase access, including to rural areas.