Africa’s gas sector presents an enormous opportunity for developed nations to diversify their energy suppliers in the face of European instability, while still meeting their environmental responsibilities.
This was the view of Roger Brown, CEO, a Nigerian energy company, Seplat Energy Plc, when he spoke in a Panel Session: International oil companies: An insight into M&A activity on the continent, at Africa Oil Week (AOW), which ends today.
Investment in Africa’s energy industry will help developed nations, improve their energy security at little cost to the environment while complying with all their Environment Social Governance (ESG) requirements, he said.
Brown said investing in Africa’s gas assets would help western nations increase energy security and reduce their dependence on states willing to politicise energy supply.
It would also accelerate development goals in Africa through increased trade and investment, and guide Africa’s energy transition by encouraging lower-carbon energy and ESG compliance.
Brown said gas was significantly less carbon intensive than coal, producing only 202kg of CO2 per MWh, compared to 354kg/MWh for coal.
He quoted a statement by the Mo Ibrahim Foundation that, “if the whole of sub-Saharan Africa (minus South Africa) were to triple its electricity consumption using entirely gas, it would only add 0.6% to global carbon emissions.” Seplat Energy is a leading provider of gas for power in Nigeria.
Brown’s statements come against the backdrop of the ongoing war in Ukraine and the recent damage to the Nord stream gas pipeline between Russia and Europe.
“We must become independent from Russian oil, coal and gas,” European Commission President, Ursula von der Leyen, said earlier this year. “We need to act now to mitigate the impact of rising energy prices, diversify our gas supply for next winter and accelerate the clean energy transition.”
Brown said that, from a Nigerian perspective, improved energy partnerships between the country and the West would boost the economy, drive development and create jobs, while providing industrialised nations with more affordable and reliable energy.
“It’s a win-win for everybody,” he said. “Using gas is also far less damaging than going back to coal, as some European nations are doing.” Austria and Germany both recently announced plans to reopen coal-fired power stations in response to energy insecurity.
“By embracing African gas, developed nations can reduce the impacts of the upheaval in Europe by diversifying their suppliers and sources, while still mitigating the existential threat from climate change.”
Investing in Africa’s gas assets would accelerate development goals in Africa through increased trade and investment, and guide Africa’s energy transition by encouraging lower-carbon energy and ESG compliance.
Boosting power supply
Brown, delivering a keynote at the Conference, said: “As a leader in this space, our priorities a s far as energy transition is concerned, is to end flaring, monetise gas, displace diesel and biomass with cleaner fuel, extend along power value chain and target smaller scale gas-to-power customers, whilst exploring new opportunities.”
Seplat Energy, he noted, currently produces 300MMscfd, which is enough to power 1GW per day. The company’s ANOH and Sapele gas projects have the capacity to fuel another 2GW by 2024.
“But we need to displace 20GW diesel generation with utility-scale gas-to-power/renewables. We will develop bottled gas products to displace biomass with cooking gas; and extend along the value chain into power generation with gas and hybrid models,” Brown said.
According to him, providing more affordable and reliable energy will boost Nigeria’s economy, drive development and create jobs.
He described the Nigerian market as a huge opportunity for the Company, noting that with a future population projected at 500 million people by 2050, Nigeria represents a huge investment opportunity across the entire energy sector.
He said improved domestic infrastructure, as well as increases in export capability, refining capacity, gas-fired capacity, improved national grid, metering, billing, payments, renewables, and clean cooking displacing biomass were clear areas of value for businesses and the Nigerian government and the people.
Citing IEA 2022 Africa Energy Report, he said the development of Africa’s energy system offers major opportunities to stimulate the creation of decent jobs that require wide-ranging skills.
In the Sustainable Africa Scenario, four million energy-related jobs in total are created across the continent in the 2021-30 periods, largely as a result of providing universal access to modern energy to households in sub-Saharan Africa, and the rapid deployment of clean energy technologies, the IEA report said.
