KPMG, one of the global Audit, Tax, and Advisory services firms was recently tasked by Ghana’s President, Nana Akufo-Addo, to audit the contract entered into by the Ghana Revenue Authority (GRA) and Strategic Mobilisation Ghana Limited (SML) to enhance revenue assurance in the extractive sector, will evaluate and decide whether to undertake the exercise or not.
A source in the accountancy practice industry and knowledgeable about the operations of international accounting firms told energynewsafrica.com that such firm performs evaluation and acceptance procedures prior to formally accepting any offer or appointment. The evaluation includes conflict of interest matters, technical competence, profile of the assignment and timeframe to perform the assignment.
Our source believes KPMG will evaluate the appointment by the President in a similar way as they do for all assignments.
The SML’s contract with GRA has generated public discussion on traditional media and social media following an investigative piece by The Fourth Estate, which alleged some wrongdoings in the contract terms and execution.
Among other things, the report by The Fourth Estate also discounted claims by SML Ghana in 2021 that it had saved Ghana over GH₵1 billion in revenue because of its services.
This prompted the Presidency to act on the issue.
In a statement issued in Accra and signed by the Director of Communication at the Presidency, Mr. Eugene Arhin said the terms of reference for KPMG in the conduct of its audit was to ascertain the rationale and needs assessment performed before the contract approval by GRA.
It was also to assess how the arrangement aligned with specific needs, assess the appropriateness of the contracting methodology, and verify compliance with legal standards and industry best practices in the procurement process for the selection of SML.
Additionally, it is to evaluate the degree of alignment between current activities and the stipulated contract scope, identifying any deviations, evaluate the value or benefit that SML had so far offered to the GRA through the engagement, as well as review the financial arrangements, including pricing structures, payment terms and resolution of any financial compliance issues.
The Presidency charged the firm to submit a report on its findings on the above, together with appropriate recommendations to the President within two weeks.
The statement said President Akufo-Addo had directed the Ministry of Finance and the GRA to provide KPMG with whatever assistance it would require for the conduct of the audit, stressing that “He (the President) has also directed the Ministry of Finance and the Ghana Revenue Authority to suspend the performance of the contract, pending the submission of the audit report.”
Great
Source: https://energynewsafrica.com
The General Transport, Petroleum and Chemical Workers’ Union (GTPCWU) in the Republic of Ghana has called on President Akufo-Addo to immediately remove three Board of Directors of Tema Oil Refinery (TOR) for hijacking the board for their selfish interest.
The union wants the President to remove David Adomako (Board Chairman), Mrs Edith Sapara-Grant and Mr Leon Kendon Appenteng.
Addressing a press conference in Accra, capital of Ghana, National Chairman of General Transport Petroleum and Chemical Workers Union, Mr. Bernard Owusu stated that the three board members lack objectivity in decisions towards the search and identification of a credible partner for the revamping of the nation’s premier refinery.
He noted that the current Board Members have been in office for 22 months and held 40 meetings at a cost to the refinery but have failed to find a credible partner for the refinery due to their decision not to open up to all interested potential partners.
“We call on the President to suggest the abrogation and termination of any ongoing discussions, intentions, agreements or arrangements involving DC-Vitol/Baybridge Asset Management Limited (BAML)/Torentco Asset Management Limited (TAML) or TEPL or any person associated with these entities because they have demonstrated their inability to partner with TOR.
“For the gross demonstration of incompetence, by colluding and condoning a conflict of interest and chasing after a nonexistent ghost in the shadow of a credible partner for almost two years, we plead that Mr Leon Kendon Apenteng, Mrs Edith Sapara Grant and Mr David Adomako be removed from the TOR’s Board for the lack of objectivity in the search for a credible partner for TOR,” Mr Bernard Owusu said.
He also called on President Akufo-Addo to intervene to get TOR back on its feet.
“We are, by this statement, calling on the President to immediately put measures in place to get TOR back to refining crude again and bring relief to Ghanaians”.
Source: https://energynewsafrica.com
Crude oil inventories in the United States fell this week by 5.215 million barrels for the week ending January 5, according to The American Petroleum Institute (API), after analysts predicted a draw of 1.2 million barrels.
The API reported a 7.418-million-barrel draw in crude inventories in the week prior.
On Tuesday, the Department of Energy (DoE) reported that crude oil inventories in the Strategic Petroleum Reserve (SPR) rose by 0.6 million barrels.
Inventories are now at 355 million barrels, with total purchases for the SPR totaling about 8 million barrels since the Biden Administration began its buyback program.
Oil prices were trading up ahead of API data release.
At 3:46 pm ET, Brent crude was trading up 1.71% at $77.42—a decrease of just over $1 per barrel compared to where it was this same time last week.
The U.S. benchmark WTI was trading up on the day by 1.84%, at $72.07–a decrease of roughly $1 per barrel compared to this time last week.
Gasoline inventories saw another large build this week, rising by 4.896 million barrels, after rising by 6.913-million barrels in the week prior. As of last week, gasoline inventories are now slightly above five-year average for this time of year, according to EIA data.
Distillate inventories also rose this week, by 6.873 million barrels, after rising by 6.686 million barrels in the week prior.
Distillates are roughly 6% below the five-year average.
Cushing inventories fell by 625,000 barrels, after rising by 765,000 barrels in the previous week.
Source: Oilprice.com
South Africa’s Department for Mineral Resources and Energy announced significant reductions in fuel prices last week, bringing some form of relief to motorists who have been lamenting over the high cost of fuel prices in the country.
In South Africa, fuel prices are reviewed monthly.
Consequently, the Minister for Mineral Resources and Energy, Gwede Mantashe, last week, issued a statement announcing the adjustment of fuel prices based on current local and international factors with effect from the 3rd of January 2024.
The price of petrol (93 ULP and LRP) dropped by 62 cents per litre, while petrol (95 ULP and LRP) dropped by 76 cents per litre.
The price of diesel (0.05% sulphur) was cut by 118.32 cents per litre and that of diesel (0,005% sulphur) was reduced by 126.32 cents per litre.
The wholesale price of illuminating paraffin was cut by 93 cents per litre.
Source:https://energynewsafrica.com
Kaduna Electricity Distribution Company, one of the power distribution companies in the Federal Republic of Nigeria has appointed Dr. Unar Abubakar Hashidu as the new Managing Director.
This follows the exit of Engr. Yusuf Usman Yahaya, the immediate past Managing Director last week.
A statement issued by the Head of Corporate Communication, Abdulazeez Abdullahi, on Monday, January 8, 2024, said a brief handover ceremony presided over by Mr. Dafe Okpaneye, the NERC Commissioner for Legal Licensing and Compliance, was conducted at the company’s corporate headquarters in Kaduna.
At the ceremony which was followed by a short interaction with staff, Mr. Okpaneye thanked the former MD for the work he had put in the past 18 months to move the company forward.
He charged Dr. Hashidu to harness the talent and resources available to him to take Kaduna Electric to greater heights.
In his address to the Executive Management Committee members and staff, Dr. Hashidu urged every staff to look in the mirror and challenge themselves to do better.
He stressed his belief in the ability of the management and staff to change the negative narrative about Kaduna Electric to a positive one.
In his farewell remarks, Engr. Yusuf also appreciated all staff for the support he got during his time and urged everyone to extend the same support to the new helmsman.
Management and staff took turns to welcome the new CEO with a promise of extending their full cooperation to him for the success of Kaduna Electric and wished the former MD the best in his future endeavours.
Before his appointment, Dr. Hashidu was the erstwhile Managing Director of North East Development Commission (NEDC) and also of Yola Electricity Distribution Company.
The newly appointed Managing Director, Dr. Hashidu, will work with special directors who will constitute non-executive directors of the board for governance purposes.
They are Alex A. Okoh (Chairman), Kabir Adamu, Sharfuddeen Zubair Mahmoud, John Ayodele and Rahila Thomas.
The appointment of special directors follows the dissolution of Kaduna Electric Board of Directors by the Nigerian Electricity Regulatory Commission (NERC) over the discos inability to pay N110bn debt owed to the Nigerian Bulk Electricity Trade (NBET) and TCN’s Market Operator (MO).
The regulator in an order dated January 1, 2024 and signed by its Chairman and Vice Chairman, Sabusi Garba and Musiliu Oseni, respectively, said the order was also due to the receivership of the company not being able to get a new buyer of the company on time.
Source: https://energynewsafrica.com
GreenIT, an Italian renewable energy firm has signed an agreement with Galileo, the pan-European renewable energy development and investment platform, for the realization of eight photovoltaic projects, totalling approximately 140 MW, across three regions in Southern, Central and Northern Italy.
GreenIT is an Italian renewable energy JV founded in 2021 by Plenitude (Eni, 51% ownership) and CDP Equity (CDP Group, 49% ownership).
A statement issued by Eni said the plants will be able to cover the electricity consumption of over ninety thousand households, thus contributing to Italy’s decarbonisation targets of the 2030 National Integrated Energy and Climate Plan and its energy transition.
The beginning of the plants’ operational phase is scheduled within the timeframe of the 2023-2027 Industrial Plan approved last April by GreenIT, which forecasts total investments of EUR 1.7 billion (including capital already committed) with the goal of reaching an installed capacity of 1,000 MW.
The initiative is in line with GreenIT’s strategy, which also includes the development and construction of greenfield plants, the construction of authorised projects, the repowering of operational plants at the end of their life cycle with the aim of extending and enhancing their production capacity, and the development of offshore wind projects.
Paolo Bellucci, CEO of GreenIT and Head Renewable Business Italy of Plenitude, commented: “We are excited about this agreement with Galileo which, thanks to its internationally recognised experience in the sector, will contribute to the development of GreenIT’s portfolio through technologically advanced projects. This transaction is in line with the company’s mission and its objectives to develop, build and operate plants for the production of energy from renewable sources in Italy”.
Ingmar Wilhelm, CEO of Galileo, commented: “We are very pleased with this forward-looking agreement with GreenIT. The quality of the portfolio of projects developed by Galileo will find a home in GreenIT, a company with all the right characteristics to take care of its construction and operation.
“In Italy, Galileo is developing a further pipeline of onshore and offshore renewable projects accounting for a grand total of more than 2,000 MW in the country. Efficient synergies with such high-calibre partners like GreenIT can be strong propellers for the further expansion of our activities across Europe.”
Source: https://energynewsafrica.com
GAIL, India’s leading natural gas firm has signed a long-term LNG deal with Vitol, under which the top commodity trader will supply around 1 million metric tons of LNG annually for 10 years starting in 2026, the Indian state-held firm said on Friday.
As part of the deal, Vitol will deliver LNG from its global LNG portfolio to GAIL in India. GAIL owns and operates a network of over 16,000 kilometers (9,942 miles) of natural gas pipelines in India and works on multiple pipeline projects to further enhance the gas supply and coverage. GAIL has around 70% market share in gas transmission and a share of over 50% in gas trading in India.
The agreement “will contribute to bridging India’s demand and supply gap of natural gas,” GAIL chairman and managing director Sandeep Kumar Gupta said in a statement.
“India is a significant and growing LNG market and we are excited to bring LNG supply from our global LNG portfolio to meet this rising natural gas demand in India,” Vitol Group’s chief executive Russell Hardy said.
India plans to significantly increase its natural gas consumption as it looks to boost its share in the energy mix from 6.3% now to 15% by the end of this decade.
But the country and its LNG importers are particularly sensitive to surging spot LNG prices and often retreat from the spot market when prices jump. Therefore, India and its large state firms are looking to sign long-term LNG supply deals.
Earlier this week, India’s Oil Secretary Pankaj Jain said that Petronet LNG, the largest natural gas importer in India, expects to sign later this month an agreement to extend its LNG supply deal with Qatar beyond 2028.
“We are pretty close to signing the deal,” Jain told reporters in New Delhi on Wednesday, as carried by Reuters.
Source: Oilprice.com
The Electricity Company of Ghana (ECG) increased the number of customers who own its PowerApp to about 3.1 million as of the end of 2023 from 250,000 customers in May 2022.
The Managing Director of ECG, Samuel Dubik Mansubir Mahama revealed this in a Christmas and New Year’s message in a video sighted by this portal.
“This is a very resounding remarkable feat. We couldn’t have achieved this without the support of customers,” he said.
During the last quarter of 2023, Ghana’s Minister for Energy, Dr Matthew Opoku Prempeh revealed that ECG’s monthly collections had increased from GH¢480 million to GH¢1.1 billion due to the introduction of ECG PowerApp.
“The PowerApp is leading ECG’s drive by improving online payments. The App users have increased from 250,000 in May 2022 to 3,045,000 as of the end of October 2023. Monthly App usage is at 94%, generating an average of GH¢745 million in monthly revenue,” the Minister said.
Mr Samuel Mahama assured ECG customers that the company would be paramount in every decision of the company in 2024.
Source: https://energynewsafrica.com
Kaduna Electricity Distribution Company, one of the power distribution companies in the Republic of Nigeria, has announced the departure of the Managing Director, Yusuf Usman Yahaya.
Engr Yahaya was appointed in July 2022 in furtherance of concerted efforts by stakeholders- Nigerian Electricity Regulatory Commission, Bureau of Public Enterprises, Central Bank of Nigeria and Lender- African Export-Import Bank and Fidelity Bank-
for an intervention in Kaduna Electric alongside select electricity distribution companies in Nigeria.
In a statement, the company said Engr Yahaya led and executed a decisive ongoing turnaround programme that has brought organisational reform, commercial growth and enhanced service delivery to customers aided by extended investments in network and energy management infrastructure.
“Kaduna Electric wishes to convey its gratitude to Engr. Yusuf Usman Yahaya for his leadership and management in initiating much-needed corporate turnaround of the company and extends our best wishes in his next endeavors,” the company said.
Source: https://energynewsafrica.com
China’s oil trade with Iran has stalled as Tehran withholds shipments and demands higher prices from its top client, tightening cheap supply for the world’s biggest crude importer, refinery and trade sources said.
The cutback in Iranian oil, which makes up some 10% of China’s crude imports and hit a record in October, could support global prices and squeeze profits at Chinese refiners.
The abrupt move, which one industry executive called a “default”, could also represent the backfiring of an October U.S. waiver on sanctions of Venezuelan oil, which diverted shipments from the South American producer to the U.S. and India, elevating prices for China as shipments dwindled.
The National Iranian Oil Co, China’s commerce ministry and the U.S. Treasury Department did not immediately respond to Reuters requests for comment.
Early last month Iranian sellers told Chinese buyers they were narrowing discounts for December and January deliveries of Iranian Light crude to between $5 and $6 a barrel below dated Brent, five traders who handle the oil or are familiar with the transactions told Reuters.
Those deals had been struck in November at discounts around $10 a barrel, the traders said.
“This is considered as an extensive default and the order to hike prices apparently came from the headquarters in Tehran, as they’re holding back supplies also to the intermediaries,” a China-based trading executive said.
An executive at a Chinese middleman that procures direct from Iran said the OPEC producer was “holding back some shipments”, leading to a “stalemate” between Chinese buyers and Iranian suppliers.
“It’s not clear how things would end,” this executive said. “Let’s wait a bit and see if refineries are willing to accept the new price.”
China has saved billions of dollars buying often deeply discounted oil from sanctioned producers Iran, Venezuela and, more recently, Russia – countries that supply almost 30% of China’s crude imports.
TEAPOTS’ SQUEEZED
It is not clear how extensive Iran’s cutbacks to China are. At least one buyer has accepted higher prices: a Shandong-based refiner bought a cargo late last month at discounts between $5.50 and $6.50 on a delivered ex-ship basis, two traders said.
The discounts could narrow further, as the latest offer heard was $4.50, the traders said. Last year’s average discount for Iranian Light, a key grade China buys with a high middle-distillates yield, was about $13, traders say.
“The buyers are still struggling to find a solution as the new prices are too high,” said a Shandong-based buyer.
“But since they have limited choices and the Iranian side is very tough, the room for price negotiations is difficult and is not favouring Chinese buyers.”
China’s smaller independent refiners, called “teapots” have become Tehran’s top clients since first buying Iranian oil in late 2019.
They replaced state-run refiners, which stopped dealing with Iran over concerns about falling afoul of U.S. sanctions.
Teapots absorb about 90% of Iran’s total oil exports, usually passed off as oil originating in Malaysia or the United Arab Emirates, trade sources say.
Amid the tussle over prices, Iran’s overall exports and China’s imports from Iran have fallen.
China imported about 1.18 million barrels per day (bpd) of Iranian oil last month, down from 1.22 million bpd in November and 23% off October’s record 1.53 million bpd, tanker tracker Vortexa Analytics reckons.
That represents the bulk of Iran’s global seaborne crude exports, which another tracker, Kpler, estimates at 1.23 million bpd for December, down from 1.52 million bpd in November.
Floating storage off Iran and nearby waters rose by about 2 million barrels to 15.5 million barrels over the past week, Kpler says.
“The Iranians want to play catch-up in prices with (Russia’s) ESPO. But they don’t fully realise the extent of sanctions on Iranian oil is different from that on Russian,” said a trading manager at an independent refiner.
Washington has sanctioned more than 180 people and entities related to Iran’s petroleum and petrochemical sectors since 2021, identifying 40 vessels as blocked property of the sanctioned entities.
The main restrictions on Russian oil have been a $60-a-barrel price cap imposed in December 2022 by the U.S. and its allies, aiming to punish Moscow over its invasion of Ukraine.
Major buyer India has mostly paid above $60 for Russian oil, hitting $85.42 in November, the highest since the Group of Seven industrial powers imposed the cap.
Source: Chen Aizhu And Muyu Xu
Uganda has filed a suit at the East Africa Court of Justice to challenge Kenya’s decision to restrain them from using the Mombasa Port to import petroleum products.
Uganda has been importing approximately 90 percent of refined petroleum products through the port of Mombasa.
The products are transported using pipelines owned and operated by the Kenya Pipeline Company Limited.
“The complete reliance and dependency on Kenyan OMCs to import and supply petroleum products to Uganda have exposed the Republic of Uganda to supply vulnerabilities resulting in an avoidable increase in fuel pump prices,” Uganda stated in court documents as reported by The Star.
In the fourth quarter of 2023, Uganda canceled its petroleum importation deal with oil marketing companies in Kenya over exorbitant prices.
It then mandated its national oil company, UNOC, to handle all petroleum importation in a bit to minimise forex exposure.
The Kenyan authorities in line with the principles and provisions of the Treaty and Protocols assured the Ugandan authorities of Kenya’s unwavering support in the implementation of the said policy.
Upon engagements with the relevant authorities in Kenya, UNOC sought to enter into a Storage and Transportation Agreement with KPC.
Consequently, UNOC was required by Kenya to meet certain regulatory requirements including obtaining an Import, Export, and Wholesale of Petroleum Products (except LPG) Licence (hereinafter referred to as “the Licence”) from EPRA to utilise the petroleum transit infrastructure in Kenya, especially the Kenya Pipeline systems in furtherance of the new Ugandan policy.
This requirement, according to Uganda, is an unnecessary hindrance to the implementation of its petroleum policy as the petroleum products were wholly transit goods and not destined for Kenya.
Uganda argued that it is a landlocked country and has the right, under the Treaty for the Establishment of the East African Community and the United Nations Convention on the Law of the Sea, to which the Republic of Kenya is signatory, of access to and from the sea and freedom of transit through the territory of Kenya by all means of transport.
Uganda wants a declaration that the actions of Kenya complained of above contravene Articles 5(1), (3)(a), (b), and (h):6(b). (d) and (f); 7(1)(a) (b); 8(1)(a) and (c); 23; 27; 28; 76(1); 89(b) and (e); 90(j); 93(c) and (d); and 130 of the Treaty for the Establishment of the East African Community and Articles 3(2), 4(2)(a), 5(1), 18 and 38 of the Protocol
“A declaration that the action of the Republic of Kenya restraining EPRA from issuing the Licence to the Applicant contravenes Articles 5(1), (3)(a), (b) and (h); 6(b) (d) and (f); 7(1) (a), (b); 8(1)(a) and (c); 23; 27, 28; 76(1); 89(b) and (e); 90(1); 93(c) and (d); and 130 of the Treaty for the Establishment of the East African Community and Articles 3(2), 4(2)(a), 5(1), 18 and 38 of the Protocol,” Uganda claims.
It also wants a declaration that the action of the Republic of Kenya prohibiting the grant of any waiver of the licensing requirements for the Licence to the Applicant contravenes Articles of the Treaty for the Establishment of the East African Community and Articles 3(2),4(2)(a),5(1), 18 and 38 of the Protocol.
A permanent injunction was issued against the Republic of Kenya for imposing unrealistic restrictions on UNOC accessing the KPC system.
Source: https://energynewsafrica.com
The Gambian Government with the support of the ECOWAS Commission has developed a national strategy document to promote and increase the consumption of Liquefied Petroleum Gas popularly known as, LPG, across the West African nation to increase access rates to clean cooking energy under the conditions of safety, sustainability, affordability and accessibility and prevent further degradation of the country’s forest reserves.
The Gambia’s national LPG consumption as a main cooking fuel stands at 1.9% of households nationally, with only 12% of households having access to at least one LPG cylinder. 97.5 % of rural households use biomass as their main cooking fuel (94% firewood and 3.5% charcoal) and in the urban areas, 31% and 52% of households uses firewood and charcoal as main cooking fuels respectively.
Data from the GamPetroleum Depot, 2021, shows that LPG consumption nationwide has witnessed growth since 2015. From a figure of 2,255 metric tonnes in 2015, the Gambia’s national LPG consumption has grown to about 5,343 metric tonnes as of 2021.
In the national strategy for the popularization of LPG, the Gambia has outlined a number of strategies to increase access rates to LPG by undertaking the following actions: reducing energy dependence on wood fuel and charcoal; improving living and economic conditions of the most disadvantaged families, developing an effective LPG Association with national recognition and clearly defined roles and mandate, full engagement with financial institutions to provide medium to long term finance for capital investments in production and business growth for entrepreneurs in the LPG and cookstoves business and soft loans to end users and developing well –established network of LPG mini filling stations and small and micro distribution in both urban and rural areas preferably no more than 500m-1km away from communities.
The Gambia hopes to raise $10,000,000 yearly to finance the strategies in the national LPG document which spans 2023 to 2050.
The Gambian national strategy for popularization of LPG was drafted by Cany Jobe, Director for Exploration and Production at the Gambia National Petroleum Corporation (GNPC), who doubled as the consultant for ECOWAS Commission for this notable project.
Speaking about the LPG strategy document, Cany Jobe underscored the need for the Gambia to make a conscious effort to implement the strategies and action plans in the document noting that if they are implemented, it will help in mitigating climate change challenges and improve the health conditions of Gambians especially women and girls.
Hon. Abdoulie Jobe ( 3rd right), Minister for Petroleum and Energy in a group photograph with participants at the workshop on National Strategy for LPG popularisation .
She said that during her study on the strategy, she learned that the long-term climate strategy of the Gambia does not include LPG.
“The alarming part of the climate change nexus underscores a call for immediate action, for the fact that we are rapidly losing our forest cover. The Department of Forestry is saying that we are losing 10,000 hectares of our forest cover every year and we have lost 97,000 hectares already. We are already marked as a Sahelian zone that is on the path to desertification. We don’t have firewood in ample supply. We don’t have charcoal in ample supply but still people are cutting down trees to make these things. So, the promotion and popularization of the LPG will help in mitigating some of these things that contribute to climate change. The inhaling of smoke could have very severe health implications. LPG has no nitric oxide emission, and it has much lower carbon dioxide emission than even the bio gas. It burns the cleanest out of all the non-renewable fuels. So, because of that, it will also prevent the high prevalence of respiratory diseases. Another health benefit is that it will remove indoor air pollution”, Cany Jobe explained.
She however stated that with all the above-mentioned benefits of LPG and contrary to popular opinion about the cost of cooking with LPG “it is cheaper at current prices than charcoal and firewood even with the price imbalance in the market. All it requires is government’s intervention to ensure there is mass awareness, promotion and popularization under the conditions of safe usage because a lot of people are scared of it, they do not know how to handle LPG”.
“At least 4 million deaths annually noted to be prematurely linked to the inhalation from the smokes and fumes and about 900 million Africans do not have access to clean cooking fuel, which includes 1.7million Gambians. Household energy contributes to 80% of Gambia’s energy needs, like cooking, heating and other domestic energy needs. 12% of Gambian households have access to an LPG stove, but actually it’s only about 2% that use it as the main cooking foil”, she highlighted.
The strategy targets to increase usage of LPG from 15% to 50% in the Gambia within the next seven years and from 50% to 100% by 2050.
Source: https://energynewsafrica.com
The Department of Energy’s Office of Petroleum Reserves has announced a solicitation for the purchase of up to 3 million barrels of crude oil for the nation’s Strategic Petroleum Reserves (SPR), the agency said in a Wednesday press release.
The solicitation is for as many as 3 million barrels of crude for delivery into the SPR in April 2024, and will go towards replenishing the nearly 300 million barrels of crude oil sold off during the current administration, ostensibly to lower retail gasoline prices for U.S. drivers.
After selling hundreds of millions of barrels of crude oil when prices were high, the Administration laid out a plan to replenish the nation’s oil stockpiles whenever crude oil prices fell below $79 per barrel.
Brent is currently trading under $78 per barrel, with WTI trading below $72.
“Today’s announcement avances the President’s commitment to safeguard and replenish this critical energy security asset.
This follows his historic release from the SPR to address the significant global supply disruption caused by Putin’s war on Ukraine and help keep the domestic market well supplied, ultimately helping to bring down prices for American consumers and businesses.
Analysis from the Department of the Treasury indicates that SPR releases last year, along with coordinated releases from international partners, reduced gasoline prices by as much as 40 cents per gallon,” the press release said in part.
Bids for the solicitation will be due on January 10, 2024.
Today’s announcement is just the latest in a string of small purchases intended to replenish the SPR—so far, about 14 million barrels in total.
The DOE must be careful to initiate its buybacks slowly enough so as to not cause oil prices to spike.
Source: Oilprice.com
The recently signed liquefied natural gas (LNG) development project in South Africa’s Mpumalanga province is a promising step on the long road to Africa’s just energy transition.
The project, being jointly developed by Kinetic Energy of Australia and the Industrial Corporation of South Africa (IDC), a national development finance institution, will capitalize on Kinetic Energy’s recent 3.1 billion cubic feet natural gas discovery in Amersfoort, Mpumalanga.
The project is expected to produce 50 megawatts (MW) of equivalent energy and eventually expand to 500 MW.
The project, which Kinetic Energy describes as South Africa’s largest onshore LNG project, exemplifies natural gas’ potential to grow the country’s economy and meet domestic energy needs.
This all comes about as South Africa works to expand its oil and gas operations in order to curb its reliance on coal and help pave the way to eventual decarbonization.
South Africa is not alone, either. As the African Energy Chamber (AEC) covers in our recently released “The State of African Energy 2024 OutlookReport,” natural gas production is on the rise both globally and in Africa.
Even more promising, our report notes that “upstream operators are now revising their strategies and aligning their future investments more in line with energy transition, and natural gas is being looked at as transition fuel.”
The African Energy Chamber will support the Invest in African Energy Conference in Paris this year organise by Energy Capital and Power.
African Energy Week will definitely be the home of Natural Gas investment in Africa.
Gas: A Logical Transition Fuel
I find it heartening that, despite calls by environmental organizations and wealthy countries to cease investment in African oil and gas projects, many of the companies actually operating in Africa appear to recognize natural gas’ value as a transition fuel.
Too long has the solution to the climate crisis been oversimplified: Decarbonization is not a goal that can be reached overnight nor without first building up the infrastructure required to support development of renewables.
Such a task is relatively simple for Western countries, which have spent centuries building their economies and infrastructure off the backs of fossil fuels.
The same cannot be said for African states, which have long lacked these same development opportunities and must now play catch-up at an accelerated pace.
Even worse, we are told to play this game of catch-up with our hands tied: to leave our natural resources in the ground while the developed nations of the world continue to exploit their natural non-renewable wealth.
We are expected to jump straight to building wind farms, solar farms, and hydroelectric dams while hundreds of millions of Africans are still living without access to electricity.
Where will the capital for such a miraculous development come from?
Who will build the foundational infrastructure needed to support it?
Developed nations are quick to promise, “We will!” but reticent to follow through on their promises.
What’s more, their foreign “aid” has frequently focused more on alleviating the symptoms of Africa’s economic and energy poverty rather than resolving the source.
With all this in mind, it is clear to me who must provide the lion’s share of capital and build the infrastructure: Africans ourselves.
And we cannot do that without tapping our own natural resources, natural gas being the most vital among them.
Its properties that burn cleaner than oil and coal, its abundance, its ease of storage and transport, and its applications in manufacturing and synthesis make natural gas the best option for Africans to establish energy security and achieve decarbonization.
Companies Leading the Way
So, again, it is encouraging to see that the AEC is not alone in our stance that natural gas production makes sense for Africa — and for energy companies.
More and more energy companies describe policies that call for pursuing energy transition measures for tomorrow while providing the natural gas to power the world today.
Look at French major TotalEnergies, which is responsible for much of the upstream activity in our continent.
Following the discovery of two huge gas fields in South Africa in 2019 and 2020, TotalEnergies is continuing its exploration and production efforts there, despite environmentalists’ efforts to block further activity.
TotalEnergies also is driving the Mozambique LNG project, considered one of Africa’s most important hydrocarbon developments.
Then there’s German independent, Wintershall Dea, which is increasing its participation in the Reggane Nord natural gas project in Algeria by 4.5%.
The company is acquiring interest from Italian utility company Edison in the project.
Wintershall Dea, which has a strong presence in North Africa, also announced first gas with its partners (Cheiron Energy, INA, and the Egyptian Gas Holding Company) at the East Damanhur block in the onshore Nile Delta earlier this fall.
I love what Wintershall Dea’s CEO and Chief Operating Officer Dawn Summers wrote about natural gas in a November opinion piece, released just before the 2023 United Nations Climate Change Conference (COP28).
“At first glance, it would seem that the gas and oil industry is merely part of the climate problem — but it will also be part of the solution,” Summers wrote.
“If gas were used instead of coal, CO2 emissions would immediately go down — by almost half.
Already today, we are decreasing the environmental impact of our activities worldwide by drastically reducing our methane emissions.
In addition, with technologies such as CO2 storage and H2 production, we are helping other sectors to decarbonise, and we aim to harness our expertise to ensure that the future energy system is more sustainable.
In short, the oil and gas industry can, must and will be part of the solution to the climate problem.”
Well said! Africa’s gas industry is part of the solution as well.
And, as our report notes, the forecast for continued natural gas projects in our continent is looking good.
Africa’s Tremendous Natural Gas Potential
Our report finds that Africa continues to hold immense natural gas potential and is positioned to not only increase its outputs but also capitalize on the underserved LNG market and meet Europe’s ongoing demand.
Our estimates show an increase from Africa’s 2023 natural gas output of about 265 billion cubic meters (bcm) to over 280 bcm by 2025.
North Africa currently drives the majority of the continent’s output, although its production is expected to remain flat throughout the rest of the 2020s.
Production ramp-up is expected through the second half of this decade as Mozambique increases its LNG output.
As new-gas start-ups across the rest of the continent come online, this trend in increased output will become further pronounced.
Nigeria and Algeria, meanwhile, are expected to drive an increased focus on LNG exports, with additional flows coming from Egypt, Equatorial Guinea, Mozambique, and waters off Senegal- Mauritania.
Africa’s natural gas sector stands poised to prepare the entire continent for eventual decarbonization, as do many of the companies operating here.
The goal of a continent fueled by renewable power cannot be achieved, however, unless the developed world also recognizes this and allows African states to transition on their own schedule, not one imposed on it by others.
Source: https://energynewsafrica.com
