Russia’s invasion of Ukraine has expanded the meaning of “energy transition” in Europe.
Usually, that time period means moving away from the fossil fuels which have pushed progress for generations and turning, instead, to rising inexperienced energy sources. But with the U.K. phasing out Russian oil imports following the U.S.’s ban – and extra EU countries anticipated to follow suit – this time the transition refers to discovering new hydrocarbon sources.
Currently, Russia provides about a 3rd of Europe’s crude oil imports and nearly half of its pure gas, some 150 to 190 billion cubic meters of gas per year. It would require a producer with sizable resources to take Russia’s place.
The world is wondering, and rightfully so, if Africa’s gas reserves – an estimated 221.6 trillion cubic feet – could be a half of the energy solution Europe so desperately needs.
My answer: Yes, African countries can assist fill the gap. They can current the “Freiheits Gas” that will wrest Europe from its dependence on Russian pipelines.
But getting there’ll be tough. African countries will want months to ramp up their gas production, particularly since till very recently, Western leaders and environmental organizations were aggressively pushing for a rapid halt to African gas funding within the name of local weather safety – an effort that despatched foreign companies running for cover.
Reducing the time required to get pure gas flowing and exported would require speedy movement on the a half of European and African stakeholders.
For one thing, whereas Africa has a wealth of pure gas reserves, it’s significantly missing in gas infrastructure. Without a immediate and significant uptake in investments by European countries, monetary institutions, and energy companies, there’s no way Africa will have sufficient pipelines, storage capacity, or processing facilities to adequately meet Europe’s gas needs.
African leaders should act decisively as well, to smooth the way for European entities to efficiently make investments in African oil and gas infrastructure projects, make offers rather than engage in unreasonable delays, and get gas manufacturing and transportation in motion. And, on the identical time, African governments should do as a lot as possible to consider African needs, even as they try to meet Europe’s.
Africans have been arguing that earlier than rushing to renewable energy sources, we have to proceed producing pure gas so we can use it to energy electrical energy generation domestically and address the continent’s widespread energy poverty. We have argued that we want time to monetize the pure gas worth chain so we can construct energy infrastructure, each for fossil fuel and renewable energy operations. Monetizing gas in Africa would create financial alternatives for our younger people at home.
So many of them today are making the dangerous journey throughout the Mediterranean in search of greener pastures in Europe. We can create greener pastures in Africa with clean pure gas and ship low carbon LNG and inexperienced hydrogen to Europe. African pure gas can be a critical pathway to rising and diversifying African nations’ economies and paving the way for a profitable and simply energy transition.
As we increase pure gas activity, we should not lose sight of our goals for Africa. We should work together, and strategically, to drive the programs that will make them happen, from commitments to retain a few of the pure gas we produce for gas-to-power projects to monetization efforts.
So, yes, let’s work with European countries to assist them reduce their dependence on Russian gas, however let’s not fail to meet the urgent wants of African nations on the identical time.
Europe, We Must Be Pragmatic
For a quantity of years now, European countries, monetary institutions, and environmental actions have been placing immense pressure on African countries to desert gas reserves and make an immediate switch to inexperienced energy.
More recently, this pressure has gone further, interfering with foreign investments in African pure gas projects. During the 2021 United Nations Climate Change Conference (COP26) in Glasgow, for example, greater than 20 countries and monetary establishments pledged to cease public financing for abroad fossil fuel projects.
Environmental concerns that weren’t backed by science even blocked Dutch multinational Shell from finishing up a seismic survey to prospect for oil and gas reserves alongside the eastern coast of South Africa final December, regardless of South Africa’s nice want for energy and the role any oil or gas found could have performed in lessening the country’s energy poverty. (Shell simply has a profitable discovery in Namibia, and I am assured they will efficiently use carbon seize applied sciences to produce carbon-neutral hydrocarbons.)
But if this sample of interfering with African oil and gas financing and manufacturing continues, existing gas projects in Mozambique, Tanzania, Nigeria, Equatorial Guinea, Mauritania, Congo, and Senegal stand to be at risk. New and expanded gas projects are unlikely. Capital goes the place it’s welcomed.
Now, with the disaster in Ukraine, it has become clear we’re not but near the worthy goal of zero-emissions energy, we’re simply not there yet. Within days of Russia’s invasion, gasoline costs were already edging higher, an indication of the market’s reliance on crude oil as a transportation feedstock. Today, we’re seeing the highest costs for fuel in decades. As for pure gas, it reached an all-time excessive in Europe on March 7 and continues to set records. So, no, Europe isn’t there yet, and neither is Africa. Producing, transporting, and utilizing pure gas, the cleanest of all fossil fuels, is not even a necessary evil. It’s a reasonable technique of assembly widespread energy wants whereas keeping carbon dioxide emissions in check.
What if we were to make a course adjustment in response to the disaster in Ukraine?
Imagine if the European Investment Bank and different monetary establishments were to begin funding gas projects. No, it wouldn’t ship the gas Europe wants today, however it will assist longer-term by offering an alternative to Russian energy. It will assist by making African countries a reliable, sustainable supply of pure gas for Europe well into the future. And it would place Africa to meet its personal urgent energy needs.
I have challenged a big variety of companies to decide to signing gas and inexperienced hydrogen agreements at African Energy Week this October in Cape Town. The recent inexperienced hydrogen development deal signed by German energy company, Emerging Energy Corporation, in Niger Republic is a transfer within the proper direction.
A final thought about Europe: It should cease handicapping Africa with handouts and foreign aid. The aid should stop. It is not serving to us. We’d a lot rather see Europe cooperate with us and focus on free-market enterprise, financial freedom, and gas monetization.
Africa’s Next Steps
It would be easy to place all of the blame for Africa’s infrastructure shortfalls on the lack of European investments. But African governments share responsibility. We should do for ourselves what we expect others to do for us. It’s not Europe’s responsibility to assemble Africa.
African countries for years positioned far greater significance on crude oil production, and the ensuing revenues they received from oil majors, than they did on producing pure gas and monetizing it to fund infrastructure development. Fortunately, that mindset has been evolving with extra African countries, collectively with Nigeria, Equatorial Guinea, South Africa, and Ghana, pursuing pure gas monetization initiatives. But these processes take time.
African governments have additionally been a lot too slow to behave when gas manufacturing alternatives arise. There is a slew of gas offers that are pending. We should admit that the bureaucracy and the triangulation in negotiations and approving offers have slowed the gas industry in Africa. In many countries that I have labored in, it takes longer to get authorities negotiation and approval for a gas project than it takes to assemble it. Today companies may even line up the financing, and able to make investments however when the negotiation and approval course of is slow or broken, there’s no level in doing a gas deal in Africa. We have seen many licensing rounds launched and no agreements were signed. And any proposal that fails to chop red tape won’t work and Africa’s gas potential bonanza will be a disaster. Look on the huge quantities of gas, almost 300 trillion cubic meters, in Nigeria, but to be produced. Look at existing projects being stalled in Cameroon, Equatorial Guinea, Tanzania and Mozambique.
I was current when Niger, Algeria, and Nigeria signed the Declaration of Niamey final month. The finish results of their cooperation is that the long-delayed Trans-Saharan Gas Pipeline will lastly transfer forward. This is important information for a project stymied for greater than 20 years by investor concerns over safety and governments’ failure to barter and push the deal forward. The $2.2 billion, 4,128-kilometer (2565-mile) pipeline is tremendously promising for the African countries concerned – it will span from Warri, Nigeria to Hassi R’Mel, Algeria, running through Niger-and for Europe. When complete, it will transport 30 billion cubic meters of gas a year from Nigeria, Algeria, and Niger to Europe.
African countries should begin fast-tracking their pure gas projects and get them in movement so market forces can drive them.
African governments additionally ought to be encouraging foreign pure gas investments by developing production-sharing contracts particularly for pure gas production, so investors know what to expect.
And, they should reject useful resource nationalism: This is not the time to demonize worldwide oil companies and foreign operators in Africa. Now, greater than ever, it’s vitally important to foster cooperation amongst nations if we’re going to obtain our goals.
Critical Moment
The way I see it, the stakes are excessive for 2 continents proper now. Africa’s pure gas reserves can meet significant, urgent wants for both. But provided that stakeholders in each Europe and Africa step up and decide to working collectively in a spirit of cooperation. And provided that they transfer decisively. Now let’s change our mindset and get to work.