• Thursday, July 25, 2024
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Nigeria, others need $100bn annual investment to fix electricity woes

Lagos shoots for improved power with new electricity Law

Nigeria as well as other countries in the African continent would require over $100 billion annual investment in the power sector by 2030 to address its electricity woes which have continued to minimize its economic growth.

This was disclosed by Amina Benkhadra, the Director General of the Office National des Hydrocarbures et des Mines (ONHYM), the National Oil Company of Morocco at the Africa Gas Innovation Summit (AGIS), held in Abuja on Thursday.

Read also:Nigeria seals $1bn deal on five power plants

According to her, Africa is faced with several challenges including a low electrification rate, low agricultural yields, the lowest integration rate in the continent, and a deficit in advanced structures. This she said heightens the need for investment in the region, a need for the development of innovations and new technology.

“And when we see the energy needs, it’s important to highlight that to satisfy the increasing African electricity demand, large investment of over $100 billion annually in the power sector by 2030 and at the same time, Africa’s growing electricity conception requires substantial investments in power infrastructure up to $3 trillion by 2050.

“And all we can see also that with its huge reserves of gas, the current gas infrastructure project pipeline can equate $245 billion with more than 90% in the concept stage and to unlock Africa’s energy future, we will need to develop major infrastructure projects both at the level of national and local projects.

“So we have to raise the ambitions of Africa’s energy strategy to increase the power generation capacity, to deepen the reforms of our energy governance, to encourage public partnership, and private partnership investment, mobilize those international investments that we have seen just before and contribute to development through technology and innovation approaches,” she said.

Speaking on the Nigeria-Morocco Gas Pipeline which was proposed in December 2016 by the Nigerian National Petroleum Company Limited (NNPCL) and the ONHYM, Benkhadra said that It will contribute to accelerating electrification and energy sufficiency in areas covered and contribute to economic integration and development of industrial sectors.

The $25 billion pipeline would connect Nigerian gas to every coastal country in West Africa (Benin, Togo, Ghana, Cote d’Ivoire, Liberia, Sierra Leone, Guinea, Guinea-Bissau, Gambia, Senegal, and Mauritania), ending at Tangiers, Morocco, and Cádiz, Spain. It would apparently be an extension of the existing West African Gas Pipeline, which already connects Nigeria with Benin, Togo, and Ghana.

Benkhadra further stressed the need for leaders to consider that the role of emerging and developing countries, especially a lot of African countries, is now an essential component in achieving the global transition to an efficient system compatible with the imperatives of sustainable development. She stated that Africa can and must play a role in the transition particularly Nigeria with its crucial resources.

Read also:Nigeria finalises bid process to sell five power plants for $1bn

Noting that Gas is the backbone of the energy transition, the DG said there was a need to reinforce cooperation between African countries and also between Morocco and Nigeria who failed several strategic projects in energy, agriculture, and especially gas.

In his remarks, Ekperikpe Ekpo, the Minister of state for Petroleum Resources (GAS), said that the global transition to a sustainable energy future requires innovative technologies and practices that minimise environmental impact while maximizing efficiency and productivity. This he said entails investing in cutting-edge research, promoting the deployment of advanced gas technologies, and encouraging the adoption of best practices across the industry.

He explained that technology is reshaping the landscape from exploration and production to transportation and utilization, adding that advancements in gas technology have continued to revolutionize the sector as evidence in innovations such as liquefied natural gas (LNG), CNG for vehicles, gas-to-power solutions, and carbon capture and storage (CCS).

Ekpo who was represented by Nicholas Agbo Ella, the permanent secretary at the ministry said, “As policymakers, we must create an enabling environment that fosters innovation. This includes providing incentives for research and development, facilitating partnerships between industry and academia, and ensuring a robust regulatory framework that encourages technological advancement while safeguarding public and environmental health.

“Effective policy frameworks are the bedrock of a thriving gas sector, our policies must be forward-looking, adaptable, and inclusive. They should address the unique challenges and opportunities of the African context, promote transparency and accountability, and ensure that the benefits of the gas sector are equitably shared among all stakeholders.

“We must also align our policies with global sustainability goals, including the United Nations Sustainable Development Goals (SDGs) and the Paris Agreement on climate change. By doing so, we can position Africa as a leader in the global transition to a low-carbon economy,” he said.

Earlier in his opening remarks, Salahuddeen Tahir, chairman of the Society of Petroleum Engineers (SPE) noted that financing, technological and skills gap, high costs of oil and gas production, infrastructure challenges, the global push for a transition to cleaner energy as well as security issues were the top most challenge in the African oil and gas space.

Read also:Nigeria suffers another power grid collapse, as labour begins strike over minimum wage
According to him, new players such as Ghana, Tanzania, Senegal Mauritania, Mozambique, Namibia, Uganda, have emerged in the African gas sector, which he said was a far departure from the normals: Nigeria. Egypt, Algeria, Gabon and Angola.

“There is no doubt that Africa is sitting on vast oil and gas resources and our easiest path to a sustainable future lies in our gas resources. The shortest path to developing these gas resources is through collaboration.

“It is heartwarming to note that collaborative initiatives such as the proposed Nigeria-Morocco Gas Pipeline and the Tanzania-Uganda Gas Pipeline are progressing. We need more of these projects and initiatives.

“On the 4th of June, 2024, the Establishment Agreement and the Charter of the African Energy Bank (AEB) was executed by Afreximbank and the Africa Petroleum Producers Organisation (APPO). This is a forward-thinking Initiative that must be supported by all African gas producers,”he said.

Mele Kyari, the Group chief executive officer of the Nigerian National Petroleum Company Limited (NNPCL) in his remarks noted that Nigeria is blessed with abundant natural gas resources of more than 290 CF of gas, which can be leveraged to address the various challenges in the country, by providing access to electricity, clean cooking fuel, autogas, and free stock for other industries, thereby generating wealth and improving our well-being.

Kyari, who was represented by Olalekan Ogunleye, the Executive vice president, Gas, Power, and new energy at NNPC, said that Nigeria is at the forefront of orchestrating a sustainable energy future for itself and Africa, leveraging on gas, technology, and innovation.

“To underscore the critical role of gas in economic development and to maintain energy security, NNPC has embarked on several gas infrastructure projects, some of which already have been commissioned, such as the second phase of the AHL gas processing plant, the 300-million-score-per-day AHL gas processing plant, and the AHL-23 CTMS gas pipeline projects, all of which were recently commissioned by the President of the Federal Republic of Nigeria.”