A former Secretary General of African Petroleum Producers Association, H.E Mahaman Laouan Gaya, has criticised organisers of the African Oil Week for deciding to host the continent’s flagship oil event in Dubai, UAE, in November 2021.
“Africans need to know that our dignity should not be given away. This is a clear sign of poor leadership. Africa will not reach its global potential if we continue to see supposedly investment promotion-focused organisations abandoning the continent at the smallest challenge,” H.E Mahaman Laouan Gaya said.
“The African Oil Industry is at the cross roads, and going into COP26, we need to have an African agenda on energy transition and energy poverty. These discussions cannot be had in Dubai. African Petroleum Producers and other energy producers should distance themselves from this initiative of taking Africans to Dubai,” he further added.
H.E Mahaman Laouan Gaya, who is also a former Petroleum Minister of the Niger Republic, described the organiser’s decision as a “humiliating idea”.
Mr. Gaya encouraged the idea of bringing African representatives and its global strategic partners to an African location to debate and find solutions and synergies to address the continent’s challenges and showcase its opportunities.
He condemned AOW’s lack of good leadership.
With this in mind, he passionately suggested that governments and organisations alike should enforce a mandate of promotion and development of the oil and gas industry by standing up for it when it is necessary and lead the rest of the world by example.
In a dedicated approach, H.E Mahaman Laouan Gaya railed behind the African Energy Chamber, the Mozambican Oil and Gas Chamber and many others against the move of the pan-African event and called on the international community to support this cause.
Source: www.energynewsafrica.com
The Content Director of Enlit Africa, formerly African Utility Week, Claire Volkwyn, has described as a bold decision by President of South Africa, Cyril Ramaphosa, to raise the cap on self-electricity generation without licence to 100MW.
Claire Volkwyn, who was speaking during the just ended Enlit Africa Digital Event hosted in South Africa, said: “The country is in the throes of an energy crisis and the importance of the discussions we had at Enlit Africa this week have been punctuated by load shedding.”
According to Volkwyn, there are many opportunities for independent generators to take advantage of South Africa’s abundant solar resources.
“This will be supported by battery storage, which has become more affordable over the past few years and this is a trend we fully expect to see continue as the technology matures and becomes more efficient.
“So many of our sessions over the last few days have touched on the role of gas in Africa, opportunities for solar in the C&I market, and how we move forward as a country and a continent to supply clean, affordable and reliable power to all the people of Africa. We look forward to continuing these discussions in November, and again in June 2022, live in Cape Town.”
Petrosol Ghana, an indigenous Ghanaian Oil Marketing Company in the Republic of Ghana, has received triple ISO certification for instituting best practices in the operations of the company.
The three ISO certification follows rigorous international auditing of Petrosol’s internal systems and processes for procuring, storing, distributing and marketing fuel and lubricants by TUV HESSEN on behalf of International Organisation for Standardisation (ISO).
The three ISO certificates are: ISO 9001: 2015 for Quality Management System, ISO 14001: 2015 for Environmental Management System and ISO 45001: 2018 for Occupational Health & Safety Management System.
Speaking at a ceremony to present the certificates to the downstream regulator, CEO of Petrosol, Michael Bozumbil said PETROSOL believes in regulatory compliance and, thus, continuously works hard to raise its standards to internationally acceptable levels of compliance.
Mr. Bozumbil was of the view that this milestone chalked by the company would give their financiers and suppliers an assurance that it had put in place systems and structures that ensured that the business remained a sustainable one with capacity to repay facilities and credit granted to them.
He called on petroleum consumers to continue patronising the company’s products and service “because we are a company that complies with regulatory requirements and also places the sustainability of the environment, the safety of people and property as our topmost priority.”
Mr. Bozumbil, who praised the staff and management of PETROSOL and dealers for their dedication, loyalty and hard work dealers, said: “This should boost your confidence and assure you that you are at the right place.
“As I have always told you, excellence has no nationality. Please, keep it up!”
The Director of Corporate Affairs for the National Petroleum Authority Maria Edith Oquaye who represented the downstream petroleum regulator congratulated Petrosol for being the first indigenous oil marketing company to hold three ISO certifications.
Source: www.energynewsafrica.com
Ghana’s Minister for Energy, Dr. Matthew Opoku Prempeh, has charged Management of Northern Electricity Distribution Company (NEDCo) to be firm in their collection of electricity bills.
The Minister said it would be impossible for the utility company to be operating at a loss due to customers not satisfying their payment requirements.
The Minister said he was looking forward to a stronger, more innovative and more viable NEDCo that would play an even bigger role in President Akufo-Addo’s vision for the power sector, which is key to the country’s industrial agenda.
The Energy Minister said this during a meeting with Management of NEDCo, led by the Managing Director, Mr Osmani Aludiba Ayuba, at the Energy Ministry.
Mr. Osmani Aludiba Ayuba (right), Managing Director of NEDCo
In a Facebook post sighted by energynewsafrica.com, Dr Matthew Opoku Prempeh explained that the purpose of the meeting was to brief him on how the company has been faring so far, the challenges it faces, what they have implemented to mitigate them and a request the Ministry to come to their aid.
“Among some of the challenges they shared were the operational losses due to the wide area and the long stringing of transmission lines, the need to upgrade these lines and unpaid bills from the Ministries, Departments and Agencies they distribute power to,” his Facebook post concluded.
Source: www.energynewsafrica.com
The ten largest public oil firms in the world reported combined profits of $46 billion for the first quarter of 2021, thanks to higher oil prices this year, data compiled by Anadolu Agency from financial statements showed this week.
The top ten firms that the agency analyzed—ExxonMobil, Chevron, Total, Shell, BP, Eni, Equinor, Lukoil, Rosneft, and Saudi Aramco—saw their combined profits rise by $8.5 billion due to the more favorable commodity price environment and signs of recovering demand.
To compare, in Q1 2020, when the pandemic hit oil demand and oil prices, only U.S. firm Chevron and the Saudi giant Aramco reported profits—of a total of $20.3 billion—while the other eight international and national oil majors lost a combined $17.7 billion, according to the estimates compiled by Anadolu Agency.
BP saw the largest increase in profit in the first quarter of 2021 compared to the same period of 2020, the agency’s calculations showed.
BP reported a profit attributable to shareholders of $4.7 billion in Q1 2021, compared to a loss of $4.4 billion for the first quarter of 2020.
The supermajor resumed share buybacks this quarter after more than tripling its first-quarter earnings from a year ago on the back of rising oil prices and “exceptional gas marketing and trading performance.”
BP reported underlying replacement cost profit—its proxy for net profit—of $2.63 billion, up from $791 million for the first quarter of last year and from just $115 million for the fourth quarter of 2020.
In terms of revenues, Anadolu Agency’s estimates show that combined revenues of the top ten oil firms increased by 6.6 percent annually to around $387 billion. Saudi Aramco’s revenues rose the most—by 20 percent to $80 billion.
The Saudi giant also reported a 30-percent jump in net income for the first quarter of the year to $21.7 billion.
Source: Oilprice.com
Ghana’s Inspector General of Police, James Oppong-Boanuh, has charged operators of fuel retail outlets in the West African nation to do proper background checks on persons they intend to recruit as workers before offering them job.
His advice follows recent robbery incidents at some fuel retail outlets in parts of the West African nation.
The IGP, who gave the advice in a speech read for him at the 4th Petroleum Safety Week by the Association of Oil Marketing Companies in Accra, said there is the possibility that recent robberies being witnessed are engineered by staff of the fuel stations.
The IGP said the police administration has IT system which can assist OMCs to conduct thorough investigations on persons they intend to employ.
According to him, the system is able to tell if the prospective employee has been involved in criminal activities before.
He charged OMCs to do well to invest in intelligence gathering systems to aid them in tracking criminals.
The Chief Inspector at National Petroleum Authority (NPA) Esther Anku, who described the fuel station robberies as worrying, underscored the need for the OMCs to partner with security agencies to deal with the situation.
Source:www.energynewsafrica.com
An official response by ExxonMobil, US oil and gas super major, has explained that it relinquished its 80 percent stake in the Deepwater Cape Three Points Oil Block offshore Republic of Ghana was based on the company’s strategic plan.
A statement by ExxonMobil confirming their decision to abandon its exploration activities in Ghana said: “ExxonMobil has surrendered and relinquished its interest (eighty percent) in the Deepwater Cape Three Points block offshore Ghana. All work commitments have been completed.
“ExxonMobil is prioritising near-term capital spend on the most advantaged assets with the lowest cost of supply in the portfolio including developments in Guyana, Brazil and the U.S. Permian Basin,” Madam Preba Arkaah, Public and Government Affairs Manager to ExxonMobil Exploration & Production Ghana (Deepwater) Ltd, said in an email to energynewsafrica.com.
The US oil and gas super major was awarded DWCTP oil block in November 2018.
According to energynewsafrica.com’s sources, ExxonMobil has made expenditures close to US$60 million including acquisition of seismic data on the DWCTP block.
Although ExxonMobil’s official response did not suggest any wrongful action by Ghana, information available from the grapevine suggested that besides the Government of Ghana’s refusal to refund US$4.2 million VAT in line with the Petroleum Agreement which limited cash flow in running the Ghana office, the conduct of some government appointees towards EXXONMOBIL leaves much to be desired.
ExxonMobil has never been happy about the conduct of some government officials who placed their parochial interest over country’s interest.
It appears there was a calculated move by some appointees of the Akufo-Addo-administration and powerful people, who lurk in the corridors of power to frustrate ExxonMobil to force them out of the country so they could look for another partner who could be greasing their palms.
Sources close to ExxonMobil traced the company’s frustration to the West African nation’s maiden licensing bid rounds in 2019.
Energynewsafrica.com’s sources revealed that ExxonMobil pulled out of the bid rounds when they became aware that the process which was initially transparent had been turned into avenue for money making.
Besides EXXONMOBIL, British Petroleum (BP) pulled out of the licensing bid leaving the smaller oil players to remain in the licensing bid round.
In the end, the Ministry of Energy announced First E&P Development Company, in partnership with Elandel Energy (Ghana), as winner for block GH_WB_02 while ENI Ghana Exploration and Production Limited, in partnership with Vitol Upstream Tano Limited, emerged winner of block GH_WB_03.
Energynewsafrica.com’s investigation revealed that First E&P Development Company, a Nigerian independent oil and gas company registered in 2011 and its partner, Elandel Energy Ghana, secured their oil block because the latter is allegedly associated with some persons at the seat of Government, Jubilee House.
Checks on the company’s website (www:elandelenergy.com) revealed that Elandel Energy Ghana doesn’t have any track record by way of executing any project in the upstream prior to winning the oil block.
Source:www.energynewsafrica.com
Crude oil prices could rise to $200 per barrel as international oil companies curb their investments in new exploration and production, Bala Wunti, Group General Manager for National Petroleum Investment Management Services of Nigeria’s National Petroleum Corporation has said.
According to him, the effect of investment decisions being made now will be felt in about five years.
“I was talking to one of my senior colleagues yesterday, and he said, well, it is time for someone to speak the truth,” Wunti said this at the Nigeria International Petroleum Summit as quoted by This Day.
“If nothing is done and this trend continues, guys, we should be ready for a $200 per barrel of oil. The reason is simple, if you stop investing in the oil and gas sector, you can only produce what you have today.”
The International Energy Agency recently called on the oil and gas industry to suspend all new exploration citing the Paris Agreement targets and the net-zero emissions of governments. However, oil demand has shown no relation whatsoever to emissions targets and has been recovering more strongly than either the IEA or almost any other forecaster expected.
Yet pressured by investors and by their own new agenda, many energy companies are squeezing their investments in new exploration anyway, relying on existing output only.
“And what you have today, in many instances in five years, it will start declining, that is, if you we are not already in a declining mode, because many in Nigeria are in declining mode,” NNPC’s Wunti explained.
“So, if there’s no fresh capital for either brownfield or Greenfield investment, we cannot grow production; if we don’t grow the production, the consequence is that we’re building a short supply for tomorrow. In basic economics, short supply means a higher price. So this is the world. This is the world that we see today and this has presented some very emergent trends.”
The Head of Energy, Mining and Infrastructure at Baker McKenzie in Johannesburg, South Africa, Kieran Whyte has described as positive news announcement by President Cyril Ramaphosa that the threshold for self-generation power project licences would be lifted for projects generating up to 100MW.
The draft amendment to Schedule 2 of the Electricity Regulation Act (ERA), was published for comment in April 2021. It contained a self-generation threshold of 10MW of power, which allowed power plants with a capacity of between 1 – 10 MW to not be required to obtain a generation licence, but to register with The National Energy Regulator of South Africa (NERSA).
The announcement by President Ramaphosa will require the draft amendments to be revised to increase the threshold to 100MW.
“This change is welcome in the current context, where power reductions have had a significant impact on the private sector and are contributing to impeding much needed economic growth in the country. Multiple actions, including the facilitation of self-generation opportunities, as well as possible industry restructuring, the implementation of the restructuring of Eskom, and the amendment of policy and regulation to keep abreast of technological advancements, need to be urgently assessed to address the country’s power supply challenges. Consumers must also have the ability to consider a broader range of supply options in order to ensure stability of supply, address ESG considerations and ensure greater certainty and visibility around tariff trajectories.
President Ramaphosa announced in October 2020 that, as part of his Economic Recovery Plan for the country, the current regulatory framework would be reworked to facilitate new generation projects as well as to fast track applications for own-use generation projects.
According to him, “The President’s announcement on 10 June is a step in the right direction. It is hoped that the necessary regulatory amendments can be promulgated shortly to build on the momentum created by President’s announcement.
“There has been broad acknowledgment that South Africa has to move forward towards the necessary energy transition and the increased utilisation of renewable energy, and that the country has been in dire need of a reliable and secure energy supply. The announcement brings South Africa more in line with the global energy transition towards a decarbonised and decentralised energy system. However, policy clarity is urgently needed in respect of the right of licence-exempted generators to sell their excess power to energy distributors.”
Members of the Organisation of Petroleum Exporting Countries (OPEC) lost about US$1 trillion to oil price plunge in 2015 and 2016, Secretary-General of OPEC, Dr Mohammad Barkindo, has disclosed.
“In terms of foregone revenues to OPEC member countries during this oil cycle, collectively about one trillion dollars was lost as a consequence of the plunge in prices in 2015 and 2016.
“No member country of OPEC was insulated from the contraction in oil revenues during this cycle.
“This had a severe impact on the resources available to the government to pursue its laudable development programmes,” Dr. Barkindo revealed this in his keynote address to the Fourth Nigeria International Petroleum Summit in Abuja on Monday.
He noted that while the 2020-21 recession was also caused by extraneous factors far beyond Nigeria’s borders, the devastating COVID-19 pandemic also severely impacted global oil demand and, again, exposing developing economies.
Commenting further on the impact of COVID -19, he said that no nation or sector of the global economy was spared and by the end of March 2020, the world seemed a different planet to what it was at the beginning of that month.
“The most challenging period in this most challenging of years was April 2020,” he said.
Dr Barkindo noted that the world economy contracted by 3.5 percent year-over-year in 2020, global oil demand declined by 9.5 mb/d, dropping further by a staggering 22 mb/d in the month of April 2020.
”In OPEC, we were stunned by things happening that we never imagined possible. On 20th April, 2020, WTI went negative for the first time in history, with prices plummeting to –37 (negative 37) dollars per barrel. Sellers were paying buyers to lift their crude.
“In response to this unprecedented situation, OPEC knew it had to act. Thankfully, we did not need to reinvent the wheel.
“We turned to the mechanism that had helped us emerge out of the 2015-2016 oil market downturns: the ‘Declaration of Cooperation (DoC)’. It was an effort to move from crisis to opportunity,” he added.
He announced that OPEC had revised its global economic forecast up to 5.5 percent for 2021, but with the oil demand growth forecast remaining at 6mb/d.
“It should be borne in mind that the majority of this demand is back-loaded to the second half of 2021. A backward action structure remains in all major crude oil benchmarks. “Additionally, we saw a draw of 6.9 mb month-on-month in OECD commercial oil stock inventories in April. This is 160 mb lower than the same time one year ago and 34 mb above the 2015-2019 average.
“We expect to see further draws in the months ahead,” he added.
Source: www.energynewsafrica.com
The Chamber of Petroluem Consumers Ghana (COPEC), a consumer advocacy group in the Republic of Ghana, has congratulated PETROSOL Ghana Limited for being awarded three of the top global quality certificates.
Petrosol Ghana Limited is a Ghanaian-owned company and has been striving over the years to operate up to international standards.
In a statement, COPEC said: “We, at COPEC, are happy to know of Petrosol Ghana Limited, an indigenous fully owned Ghanaian company, having been awarded three of the top global quality certificates.
“The Chamber of Petroleum Consumers, a mouthpiece of downstream petroluem consumers, is, by this, congratulating PETROSOL for this great feat in putting the consumers first and also receiving the Certificates on Friday 12th June, 2021, at your Spintex Road Service Station for and on behalf of Ghanaian consumers.”
The certificates include ISO 900:2015 for Quality Management System, ISO 14001:2015 for Environmental Management System and ISO 45001:2018 for Occupational Health Safety Management System.
COPEC is of the view that these Certificates would go a long way to give assurance to Petrosol’s stakeholders that their systems and procedures are compliant to all the above ISO standards.
“Further, these certificates give an assuring comfort that PETROSOL is working strenuously to deliver fuel of the highest quality and quantity for the safety and satisfaction of Ghanaian consumers.
“COPEC hopes that the many other Ghanaian companies would strive to give to the consumer the highest of standards and prescribed qualities as your PETROSOL has done for which they received these further assurance certifications from global standards body.”
COPEC also stressed that though PETROSOL meets all the standards prescribed for the Ghanaian downstream, the company’s continuous efforts at becoming one of the best if not the best is commendable.
Source:www.energynewsafrica.com
Africa’s most populous nation, Nigeria, has been listed among Democratic Republic of Congo and Ethiopia as the countries with the largest electricity deficits in the world.
In a report titled: ‘Universal access to sustainable energy will remain elusive without addressing inequalities’, which was launched by the World Bank on Monday, it noted that “Significant progress has been made since 2010 on various aspects of the Sustainable Development Goal 7.”
The report, however, noted that progress has been unequal across regions.
“While more than one billion people gained access to electricity globally over the last decade, COVID’s financial impact has made basic electricity services unaffordable for 30 million more people, the majority located in Africa.”
According to the Bank, unless efforts are scaled up significantly in countries with the largest deficits, the world would still fall short of ensuring universal access to affordable, reliable, sustainable and modern energy by 2030.
Nigeria was also listed among the top 20 countries that lacked access to clean fuel and technologies for cooking.
“Of the top 20 countries with greatest number of people lacking access to clean fuel and technologies for cooking, 10 are located in Sub-Saharan Africa (Nigeria, Ethiopia, Democratic Republic of the Congo, United Republic of Tanzania, Uganda, Kenya, Mozambique, Madagascar, Ghana, Niger).
“Six are in Eastern Asia and South-Eastern Asia (China, Indonesia, Philippines, Myanmar, Viet Nam, the Democratic Republic of Korea) and four are in Central Asia and Southern Asia (Afghanistan, Bangladesh, India, Pakistan).”
The World Bank said during the period of 2010 of 2019, the top five most populous low- and middle-income countries (China, India, Indonesia, Brazil and Pakistan) increased their combined access rate by two percent while progress in all other LMIC remained unchanged or stagnant over the same period.
According to the report, to ensure no one is left behind, the political commitment and financial incentives must be prioritised in all access-deficit countries to achieve the universal target of SDG 7.
Source:www.energynewsafrica.com
ExxonMobil’s Global Strategy
ExxonMobil’s long-term growth strategy is hinged on advantaged projects, industry-leading growth opportunities and favorable cost environment, intended to support earnings and cash flow growth potential. The goal is to rebuild balance sheet capacity to manage future commodity-price cycles while working to maintain a reliable dividend for its shareholders.
The next is focusing on mitigating climate risk and establishing new plans that are projected to be consistent with the Paris Agreement goals of reducing carbon emissions and risks associated with climate change. It is as a result committing huge investment to research, develop and deploy lower-emission technologies like carbon capture and storage, advanced biofuels, energy-efficient manufacturing, and Hydrogen.
Following the severe negative impact on its operations, the oil major has adjusted its capital investment plans, by reducing spending by more than 30 percent going forward. It is developing plans that are more flexible to market conditions, and focusing on few priority areas that will deliver the strongest returns.
Based on that ExxonMobil is removing less strategic assets from its portfolio, and concentrating on high-performing chemical projects, refinery upgrades, and advantaged assets in Brazil, Guyana, Papua New Guinea, and the U.S. Permian Basin.
In Guyana, the estimated gross recoverable resource from the Stabroek Block increased to more than 8 billion oil equivalent barrels, in part because of six additional discoveries made in 2019 and 2020. In the Permian Basin production volumes has increased and remain on track to exceed 1 million of oil equivalent barrels per day by 2024.
In Brazil, ExxonMobil holds the leading acreage position among international oil companies, adding more than 450,000 acres in 2019, for 2.5 million net acres.
In the downstream sector, ExxonMobil remain focused on maximizing value from its based assets through increased integration, utilization and efficiency. The company is strategically upgrading its portfolio through strategic divestments through its US$15 billion divestment program.
The re-organization along the value chain is to help ExxonMobil reduce operating costs and to improve on operational efficiencies, to better position the company for the future. This is the global position of ExxonMobil― not quite different for other oil majors, and other international oil companies.
ExxonMobil Ghana Exits
The exit of ExxonMobil from Ghana is following a global trend, and consistent with the company’s global position of doing away with less strategic assets, and rather concentrating on high-performing chemical projects, refinery upgrades, and advantaged assets.
The decision to exit from Ghana was easily made partly because the quantum of oil find during the initial exploration of the Deepwater Cape Three Points (DWCTP) appears not fall within its threshold, and therefore does not make commercial sense to pursue. Another likely reason could be the company’s expectation of Tax exemptions from the initial exploration activities, falling off the table. The exemptions if offered could have provided some form of free cash flow for the company to attempt drilling further wells to confirm the results or otherwise from the initial Seismic survey.
These domestic experiences of ExxonMobil Exploration and Production Ghana coupled with its global position of focusing on few priority areas that would generate decent returns, may be influencing ExxonMobil to relinquish its 80 percent operating stake in Ghana’s DWCTP block.
The exit of ExxonMobil comes at a time Aker Energy has postponed the development of the Pecan field in the Deepwater Tano Cape Three Points (DWT/CTP) block offshore Ghana, with high possibility of exiting, if cash-flow constraint persist.
Currently, oil companies are struggling to raise funds for projects because substantial amount of global capital is being directed at renewable energy projects, away from hydrocarbons. The shift follows the unprecedented political and business momentum renewable energy is currently enjoying, with the number of policies and projects around the world expanding rapidly.
The oil majors and other international oil companies (IOCs) are diversifying into renewables, motivated to invest heavily in renewable technologies and projects because that is where the cash is drifting.
Options For Ghana
The exit of ExxonMobil Ghana from the country, coupled with the delay to submit a Plan of Development (PoD) by Aker Energy Ghana while the energy transition is on, may result in the country’s hydrocarbon resources being stranded, thus denying the country of the badly needed revenue to support its budget.
The Government as a result have alternative options to explore in the immediate term and in the long-term, to exploit the country’s hydrocarbon resources for the benefits of the citizenry. Urgent action is required for the efficient exploitation of the resources as expeditiously as possible before the “Green” revolution, which is directing more focus into the renewable energy space.
Government may consider as part of the strategic options, to improve its fiscal regimes, review Petroleum Agreements (PAs), and resource the state oil company to achieve Operatorship status, without the usual political interferences.
First, it thus appear that the country’s take as “Royalty” and other related taxes are quite on the high side, in the face of changing market conditions. Government may therefore consider reviewing downwards Royalty and other tax rates, taking into consideration the energy transition taking place, and directing funds to “green” projects and away from hydrocarbons. This measure is to serve as an incentive for existing and potential players in the upstream petroleum sector to continue pursuing projects within the sector.
Second, Government may wish to look at the “up-front payments” that the country takes, as captured in the Petroleum Agreements (PAs) in the form of technology transfer and training. These upfront payments, which the oil companies are expected to make within 90 days and before undertaking Seismic surveys, is serving as disincentive to the oil companies, particularly the smaller ones. If the up-front payments that goes as high as US$7 million be reviewed downwards, the savings could serve as free cash flow to the oil companies to deploy into their operations.
Third, the “exploratory period” can also be reviewed by extending it from the current 7 years (should there be no force majeure), to possibly 10 years. This is to give the companies enough time to acquire Seismic data, analyze the data, establish the existence of reservoirs of hydrocarbons, and to reduce the number of dry holes.
Four, to take a look at existing Petroleum Agreements and those that are not performing, for a possible review of the fiscal regimes. The fiscal terms constituting royalties, free carried interests, additional carried interests, additional oil entitlement, fees, and rentals, can be reviewed and re-packaged to attract investment into the fields.
Five, Government may want to limit its influence on the Ghana National Petroleum Corporation (GNPC), to allow its focus on the hydrocarbons. The GNPC can be well positioned to take up from where the international oil companies are stopping. Since these fields, particularly ExxonMobil’s are de-risked by virtue of the additional information gathered, the GNPC represented by its subsidiary Explorco can attempt to appraise the fields, and venture into full production if commercial discovery is made. To beef up GNPC’s financial and technical capability, a strategic partner can be sought to develop stranded fields.
South Africa’s Minister of Mineral Resources and Energy Gwede Mantashe says energy security is at the centre of the country’s Economic Reconstruction and Recovery Plan, “with a requirement of reliable, affordable and clean energy sources, as well as long-term sustainable jobs.”
The Minister said this in a speech read for him by Advocate Thabo Mokoena, the Director General of the Department of Mineral Resources and Energy during the opening session of Enlit Africa, taking place online from 8–10 June.
He said South Africa “fully appreciates the risk of climate change for current and future generations and the need for a transition to a low carbon economy”. Mitigating climate change and a just energy transition are also important themes of the conference.
Minister Mantashe said while the “National Development Plan needs South Africa to transition to a lower carbon-intensive economy, we recognise the challenges proposed by climate change, given our country ‘s developmental needs, and that coal power generation currently represents around 74% as part of our generation mix”. The rest of the country’s energy is provided by 7% hydro, 4% wind, 3% solar PV, 1% solar CSP, 7% oil and 3% nuclear.
He said it was “critical for the country to fully understand the trade-off between the new investments needed in power generation and the reduction in coal mines’ production, as well as the eventual closure of some stations around 2040, as driven by different levels of emission targets.”
Minister Mantashe also stated that the country was making steady progress on its hydrogen society roadmap, “meant to set out a vision for an inclusive hydrogen society in South Africa, so that an enabling compact between industry, labour, community and government can be developed.”
According to the minister, “the evolution of a just energy transition in South Africa will require a balanced, integrated, enhanced and innovative international collaboration at both technical and financial levels”. He invited the Enlit Africa attendees to “work with us, collaborate and partner and also, assist the process towards a balanced and fair outcome for all South Africans.”
IEA’s Net Zero Roadmap
The opening session also featured a visionary discussion about whether Africa’s energy transition has to follow the same trajectory as the rest of the world.
Recently the International Energy Agency (IEA) published its World Roadmap to Net Zero by 2050, describing the transition needed from governments, companies, investors, and citizens, to fully decarbonise the energy sector and put emissions on a path to limit global warming of 1.5 degrees.
“I advise everyone to read this report,” said panellist Max Jarrett, the IEA’s Africa programme manager. “It’s not just the 400 milestones related to fossil fuel investments that are necessary, but the whole package needs to be looked at. Of course, African countries are going to have to chart these pathways differently towards meeting these commitments, but at the same time, the IEA has presented a global context of what we collectively are going to need to do.”
Solar Africa’s Answer To Decarbonise
“If we look at decarbonisation in particular, COVID-19 and the developments over the last 15 months have shown that the world can do this,” was the opinion of fellow panellist Sabine Dall’Omo, CEO of Siemens in South Africa. “We have seen much less emissions of industrial applications and the output in 2020 was significantly lower. But what is important when it comes to decarbonisation is that if we don’t do anything about it, it would mean a significant impact on the global economy.”
According to Dall’Omo, developing countries will be hardest hit and alternatives are needed to offset the increase in carbon emissions in Africa. “We believe that particularly solar energy, which is relatively fast, deployable, has a good efficiency on the continent, and could really be a game changer for Africa, because it’s also sizable from a contractual point of use and you don’t have massive capital layouts.” Smart storage solutions can also make a significant difference to the outlook on the African continent in this regard, according to the Siemens executive.
Source:www.energynewsafrica.com
