Nigeria’s Chief Inspector of Diving, Mr Julius Ugwala, has urged multinationals and local companies to get requisite approvals from the Diving Governing Board of Ministry of Labour before commencement of diving operations.
Ugwala gave the advice in a statement in Lagos on Thursday, while on a nationwide enforcement exercise embarked by the Diving Governing Board.
He also urged them to adhere to the 2018 Diving at Work regulation so as not to fall into the hands of the law.
According to Ugwala, ensuring safe diving operations and engagement of competent divers is the priorities of the board.
“Organisations which conduct diving operations without the approval of the Diving Governing Board contravene the 2018 Diving at Work regulation,” he said.
He added that most deaths and accidents recorded in-country were avoidable if appropriate safety steps were consciously taken by diving contractors and International Oil Companies (IOCs).
“When safety measures are ignored, it leads to fatalities and sometimes this happens so fast.
The board will continue to strive to attain its mandate which is a safe diving sector.
“One of the ways to comply with safe diving regulations is to apply to the Director of Diving informing the Board of the intention to carry out diving activities and obtaining a proper approval.
“Recall that the Nigerian Diving Board recently prohibited some diving operations in Lagos for operating without approvals, violating other regulations and following the death of a diver on one of the sites,” he said.
Ugwala noted that they were focused on ensuring safe dives and enforcing compliance to the 2018 Diving at Work regulation.
“The regulation stipulates that before any diving commences on Nigerian territorial waters, there must be an approval.
Besides that, there is also something known as Labour Card and Permit to Dive. Organisations should endeavour to obtain them,” he said.
Ugwala decried the unregulated diving operations which he said was becoming alarming in the country.
He disclosed that divers were dying on daily basis due to the development.
Ugwala said that the Board had resolved to carry out audits of all dive jobs on Nigerian waters to close all safety gaps and sanitise the industry while ensuring safe diving operations.
He further implored IOCs and diving contractors to ensure that trainee supervisors had access to panel hours to boost confidence in the sector.
By NJ Ayuk, Executive Chairman, African Energy Chamber (www.EnergyChamber.org) Reduced deliveries of Russian natural gas is a source of anxiety for the European Union, and rightly so, given that the bloc has been too dependent for too long weather.
for a long time at Gazprom, a Russian majority state-owned company that serves as a de facto political instrument for the Kremlin.
But this anxiety is also a source of potential for African gas producers, as it is driving European consumers to look elsewhere for fuel.
This search has drawn attention to a number of African gas projects that are likely to help Europe in the future, especially as the EU seeks to permanently move away from reliance on Russian gas.
Both Tanzania and Mozambique, for example, are planning large-scale offshore development plans that will support liquefied natural gas (LNG) plants capable of shipping large volumes of the fuel to European markets by the end of the decade.
The Republic of the Congo hopes to accelerate a medium-scale modular project that can start production a few years earlier.
Meanwhile, other greenfield initiatives are being discussed in Mauritania and Namibia, and several large international companies have come together to bring new fields online to facilitate LNG production in Angola.
All of these projects are exciting and new.
For the time being, however, they are not going to have much concrete impact on the European energy balance.
That's because they can't.
They are not ready yet.
The African Gas Timeline These projects have great potential, but their potential has yet to be realized.
In countries like Tanzania and Mozambique, we know the gas is there because the International Oil Companies (IOCs) have seen, measured, analyzed and tested it; they just don't have time yet to drill all the development wells and build all the infrastructure needed to extract it and convert it into LNG for export.
In the Republic of Congo, we know the gas is there, and the big Italian company Eni is already extracting it, just not on a scale that can immediately serve buyers in Europe or local power plants.
These obstacles can be overcome.
Holes can be filled, wells drilled, pipelines connected, gas liquefaction plants built, tankers chartered.
But it will take time, years, not weeks or months, to organize the necessary financing, sign the necessary contracts, gather the necessary materials, etc.
However, this does not mean that Africa cannot play a role in helping the EU wean itself off its dependence on Russian gas in the short term.
The importance of existing capacity But much of that assistance, at least in the short term, will come from existing capacity, that is, from places in Africa that are already producing gas for export to Europe.
Above all, it will come from these three countries: Algeria, Egypt and Nigeria, which will account for 80% of African gas production between 2022 and 2025, according to the African Energy Chamber's State of African Energy Q2 2022 report, prepared in consultation with Rystad Energy.
(Algeria, Egypt and Nigeria will also account for about 60% of the continent's total LNG production capacity during the same period, even as construction of new facilities progresses, the report says.) These three states are already known to be the largest.
gas producers in Africa.
According to the 2022 edition of BP's World Energy Statistical Review, they accounted for just over 83% of the 257.5 billion cubic meters (bcm) of gas extracted in Africa in 2021 (for context, that's roughly the equivalent of all the gas consumed by Iran in a year), Algeria contributes 100.8 bcm (or more than 39% of the total), Egypt 67.8 bcm (more than 26%) and Nigeria 45.9 bcm (almost 18% ).
In addition, they also account for the vast majority of Africa's gas liquefaction capacity of around 75.3 million tonnes per year (mtpa), with Algeria contributing 29.3 mtpa, Nigeria 22.2 mtpa, and Egypt 12.
Algeria and Egypt have the only operating LNG plants in North Africa, while Nigeria is home to a plant that accounts for nearly 66% of sub-Saharan Africa's total LNG production capacity of 33.8 mtpa.
Algeria, for its part, not only has LNG; It also has pipes.
It is already using two of them, the Medgaz and TransMed systems, to pump fuel directly to Spain and Italy through the bottom of the Mediterranean Sea. Together these two pipelines are capable of handling up to 40 bcm per year of gas.
The good news is that Algeria, Egypt and Nigeria are already supplying a good deal of the gas that Europe has been using to supplement Russian supplies.
Even better, they also have enough spare capacity to make their plans to ramp up production in the coming years realistic.
Signs of confidence Italy's Eni — and the Italian government, which has a majority stake in the company — are equally confident in the potential of these countries to help meet Europe's gas needs, as evidenced by the decision to turn to Algeria and Egypt in the search for alternatives to Russian gas.
Both Italian government officials and Eni executives have traveled to Egypt and Algeria since Russia's invasion of Ukraine in late February to negotiate and sign new supply deals.
Similarly, French oil major TotalEnergies recently extended its commitment to a project in Algeria's North Berkine basin, in part with the aim of finding ways to export associated gas from its oil fields to Europe.
They had good reason for making these decisions, and good reason to hope that they would pay off in the short term!
It is worth noting, of course, that Africa can help make up some of the difference, not all of it.
It cannot serve as a substitute source for the entire volume of 155 bcm that Russia delivered to the EU in 2021!
But you can play a key role in this process, and you don't have to wait to start.
By NJ Ayuk, CEO of the African Chamber of Energy Senegal and Mauritania could be described as rising stars in the energy industry.
After one major offshore discovery after another in the region between 2014 and 2017, it has become clear that the region has massive reserves of natural gas: up to 1.13 trillion cubic meters (tcm) in proven reserves in Senegal and 28 .3 billion cubic meters (bcm) in Mauritania.
There was a time in the not too distant past when the chances of Senegal and Mauritania fully capitalizing on their rich resources were not entirely certain.
The great African discoveries of oil and gas were greeted with hand wringing by Western countries and environmental organizations.
The general argument was that African countries were better off leaving their oil resources in the ground so that they would not contribute to greenhouse gas emissions and global warming.
International oil companies (IOCs) and investors were increasingly reluctant to support African oil projects.
But now, world events have changed much of that.
During the last months of 2021, global demand for gas began to outstrip supply, driving natural gas prices to record highs in Asia, Europe and the US.
Russia's dependence on gas in response to its invasion of Ukraine .
The situation has become even more urgent for Europe in recent months: Russia has responded to Europe's plans to gradually use less Russian gas with immediate reductions in gas deliveries.
As a result, Western countries that once pressured African countries to give up their oil resources are now investing in African oil and gas projects.
They are interested in building African infrastructure.
They are focused on doing whatever they can to help meet your pressing gas needs.
I wouldn't describe the under-supplied gas market or the suffering in Ukraine as opportunities, but these situations have created a new reality for African countries with oil and gas reserves.
My advice to Senegal and Mauritania, and the companies that have discovered oil there, is to be aggressive in keeping their projects on schedule.
Natural gas and liquefied natural gas (LNG) projects are already in various stages of development in Senegal and Mauritania, but it is imperative that stakeholders do all they can to push their projects forward.
They must avoid delays because it is impossible to know how long European countries will be willing to invest and promote these projects.
The reality is that while Senegal and Mauritania now have a better chance to capitalize on their gas for domestic needs, to monetize gas, and to grow and diversify their economies with gas, their window to achieve those things has an invisible expiration date.
The African Chamber of Energy addresses this issue in its Petroleum Laws - Benchmarking Report for Senegal and Mauritania, to be published soon.
One of the report's key recommendations for government leaders and international oil companies (IOCs) in Senegal and Mauritania is to make it a priority to avoid project deadline delays.
We have already seen declines As our report points out, projects in the region have already faced some obstacles.
Take a look at Greater Tortue Ahmeyim (GTA), the offshore LNG project on the Senegal-Mauritania maritime border being developed by BP, Kosmos Energy, Senegal's national oil company Petrosen and the Societe Mauritanienne des Hydrocarbures (SMHPM) of Mauritania.
The project's floating liquefied natural gas (FLNG) project, a Phase 1 development, was initially scheduled to come online in 2022.
Project partners now plan to complete Phase 1 in 2023.
The initial delay was caused by the COVID-19 pandemic, but the project also experienced a small “timeline shift” due to cost inflation, which delayed completion of Phase 1 from Q1 2023 to Q3.
GTA, and the other projects in the region, from the Yakaar-Teranga LNG and power project to BP's BirAllah gas project off the coast of Mauritania, must move forward.
As our report says, “Any delay in these projects that are already looking at from the late 2020s to the mid 2030s (barring the launch of GTA FLNG Phase 1) may result in no can fully utilize the under-supplied LNG market in the coming years.” It is also important to recognize that while European countries are doing their best to import natural gas from Africa, they are working just as furiously to source gas from other regions of the world, including the US, Guyana, Qatar and Azerbaijan.
As Stanley Reed wrote for The New York Times, “As Russia tightens its grip on natural gas supplies, Europe is looking everywhere for energy to keep its economy running.
Coal-fired power plants are being revived.
Billions are being spent on terminals to bring in liquefied natural gas, much of it from shale fields in Texas...
Across Europe, fears are growing that a Russian gas cutoff will force governments to ration fuel already companies to close factories, measures that could put thousands of jobs at risk.” We must also remember that Europe also considers green energy sources as part of its energy solution.
Once again, European leaders are looking to Africa to meet some of those needs, in particular green hydrogen (produced without fossil fuels), which is a valuable opportunity.
But that doesn't mean we shouldn't recognize the urgency of helping Europe meet its natural gas needs while we still can.
To miss out on all that gas can do for Senegal and Mauritania, in what it can do to help eradicate energy poverty, build businesses and create jobs, would be a heartbreaking loss.
We can do this.
I understand that some gas project delays, like those caused by the pandemic, are out of anyone's control.
But there are steps governments and companies can take to keep projects moving forward.
As I have made clear more than once, the governments of Senegal and Mauritania are to be commended for all that they have done to create a positive environment for doing business in their countries.
Their tax policies were created specifically to attract IOCs, and that was exactly what needed to be done.
With that said, I would encourage oil and gas ministries to continue to find and eliminate bureaucracy and inefficiencies that may impede the progress of gas projects.
I am encouraged by the words of Moustapha Bechir, Director General for Hydrocarbons at the Mauritanian Ministry of Petroleum, Energy and Mines, who has said that the ministry is working to optimize Phase 2 of the GTA FLNG project.
“We are now remodeling Phase 2 to better fit the concept and to speed it up and maximize project economics,” Bechir said in 2021.
As for the companies that have been exploring in Senegal and Mauritania, those that are moving forward with projects gas and LNG, have also made great strides.
I would simply encourage them to be proactive in recognizing situations that could interfere with project timelines so that they can be addressed as efficiently as possible.
I have told my employees and fellow African energy stakeholders that we still have work to do, there is still much good we can achieve.
The same goes for the governments and companies of Senegal and Mauritania.
The region's natural gas really does have the power to benefit ordinary people.
It can make it possible for millions, many for the first time, to experience life with reliable electricity.
You can create business opportunities and empower people to make a good living.
And it can lay the foundation, through industrialization and economic diversification, for a pattern of long-term growth and stability.
We simply need to move quickly and decisively to make these things happen.
The Federal Government on Tuesday reiterated its commitment to achieving self-sufficiency and net exporter of energy resources by 2026.Mr Bala Wunti, Group General Manager, National Petroleum Investment Services (NAPIMS), made this known while speaking at the 2022 Society of Petroleum Engineers (SPE) Nigeria Annual International Conference and Exhibition (NAICE) on Tuesday in Lagos.
The News Agency of Nigeria reports that he spoke during a panel session on “Sustainable Energy Transition Strategy: The Role of Legislative Frameworks and Investment Programmes.
”Wunti said though the government had pledged to achieve net zero carbon emission by 2060, its priority remains reducing energy poverty in the country with its abundant hydrocarbon resources.
To this end, he said the government’s target was to attain zero dependence on imported energy, both primary and secondary, as well as becoming a net exporter of secondary energy resources by 2026.Wunti said the plan was to provide access to energy to 100 per cent of the population through the gas to power initiative which would spur industrialisation and economic growth.
He, however maintained that this could only be achieved through effective legislative frameworks and investment programmes needed to maximise the opportunities in the oil and gas sector.
Wunti said there was need to create a platform where market investment and financing come together with regard to delivery of energy in a more sustainable manner.
He noted that unfortunately, the industry had witnessed decline in investments in recent years which had plunged the world into the global energy crisis.
According to him, available statistics from the Organisation of the Petroleum Exporting Countries (OPEC) shows that the world requires $11.8 trillion to meet its energy needs.
Wunti said the current global energy crisis was due to energy imbalance with supply falling short of demand which had driven the price of energy resources upward.
Also, Mr Austin Avuru, Chairman, AA Holdings Ltd., said Africa must design home grown solutions to the divestment of assets by International Oil Companies across the continent.
Avuru said the move was largely responsible for Nigeria being unable to meet its OPEC quota, adding that there was need to grow indigenous companies to fill the void created by the divestment of the IOCs.He said the way forward was for the companies to get access to funding from within the continent for oil and gas exploration.
Avuru also called for deployment of technologies, production of more natural gas and encouragement of tree planting to achieve decarbonisation while maximising the continent’s abundant oil and gas resources.
Earlier in his remarks, Prof. Olalekan Olafuyi, Chairman, SPE Nigeria Council, decried the lack of access to energy by many Africans.
Olafuyi said building a sustainable energy sector was fundamental for the African continent to power sustainable industrialisation and trade.
He said this underpins the African Continental Free Trade Area (AfCFTA) plan and thus highlights further the need for regional integration to solve Africa’s energy and climate challenges.
“Ramping up sustainable energy generation capacity by 2030 according to the African Development Bank’s (AfDB) New Deal on Energy for Africa, requires a minimum of $44 billion of annual financing.
“Maintaining and extending the pace of progress will thus require strong political commitment and sound governance, long-term energy planning, adequate political and fiscal incentives as well as public and private financing,” he said.
The Federal Government has assured Nigerians that the establishment of the Hydrocarbon Pollution Remediation Project (HYPREP) was guided by legal instruments and international obligations.
A statement by Mr Saghir el Mohammed, Press Director, Ministry of Environment in Abuja, said that the aim of the project was to adress environmental challenges in the country.
According to him, this is in line with government gazette and UN Environment Programme (UNEP) report guiding the establishment of the HYPREP.
“Therefore, the project is appropriately placed under the purview of the ministry.
“We wish to further inform the public that President Muhammadu Buhari has, vide a memo on April 28, 2022 with Ref. No, 8182, conveyed this via the Secretary to the Government of the Federation.
“The President reiterated the oversight of the ministry over HYPREP and has directed the Environment Minister, Mohammed Abdullahi, to deliver on the Ogoniland cleanup with dispatch,” he said.
While approving the reorganisation of the operations of HYPREP to make it more effective, the President, equally directed for the full audit of the accounts of HYPREP from inception to date.
The ministry therefore, assured all International Oil Companies (IOCs), partners and Ogoni stakeholders of the commitment of the Federal Government to those instruments and obligations.
In this connection, Abdullahi implored stakeholders to remain calm and continue to cooperate with HYPREP as it strived to execute its mandate.
The minister said that the ministry would continue to provide purposeful leadership towards the actualisation of the commitment of Buhari to clean, remediate and restore the polluted environment.
The remediation and restoration would not only be in Ogoniland but the rest of the Niger Delta and beyond.
Nigeria represents one of the most mature oil and gas markets on the continent, as well as the second largest oil producer in sub-Saharan Africa. The country's energy achievements have been largely attributed to the involvement of a number of international oil companies (IOCs), including TotalEnergies, Shell, Eni, Chevron and ExxonMobil, who Woomac says collectively have equity interests in over 110 oil extraction licenses and are responsible for 45% of the country's oil production, as well as the leadership of the state-owned Nigerian National Petroleum Corporation (NNPC). However, with the IOC divestment of key hydrocarbon assets in light of the energy transition, local Nigerian companies have stepped up, buoyed by local content-oriented regulation and the implementation of the African Continental Free Trade Agreement (AFTA). AfCFTA).
Market-driven policies enhance national participation
Nigeria represents a pioneer within the African oil and gas space with respect to the implementation of local content policies that aim to boost the participation of local companies. In 2010, the government established the Nigerian Oil and Gas Industry Content Development (Local Content Act), a comprehensive framework to promote indigenous participation in the sector. Specifically, the Local Content Law prescribes minimum thresholds for the use of local products and services; promoting the transfer of skills and technology for the Nigerian workforce; ensures value addition and job creation; and the award of oil and gas contracts and commitments to local companies. In this regard, regulation has been instrumental in enhancing the role of local businesses and creating a highly competitive domestic market in Nigeria. With a bill for the amendment of the law currently being debated, in which the modifications include expanding the definition of Nigerian companies and capacity compliance while revising the minimum target levels for imported items, Nigeria is committed to significantly improving local content across the industry.
Meanwhile, representing a key driver of Nigeria's domestic market, the implementation of the Petroleum Industry Act (PIA) in 2021 has further supported Nigeria's domestic market. While the PIA encompasses a complete overhaul of the oil and gas industry, the commercialization of the NNPC, the introduction of two regulatory agencies, and ensuring greater transparency and accountability, the legislation predominantly focuses on managing income and natural resources. Therefore, the Local Content Law continues to be mandatory in the country and will continue to promote the national sector.
Take Advantage of AfCFTA Opportunities
With an environment conducive to stimulating the participation of local businesses, the implementation of the AfCFTA in January 2021 only served to enhance the participation of indigenous Nigerian businesses, creating new opportunities for intra-African trade. Specifically, the AfCFTA includes the reduction of tariff and non-tariff barriers, the simplification of customs procedures and the elimination of bureaucracy to create a single market for goods, people and services. For Nigeria, the AfCFTA is particularly important as it has improved regional supply networks, national employment opportunities and capacity building in the regional oil and gas industry. Nigerian companies can now benefit from better export opportunities, regional investment and access to new logistics and distribution supply chains. In this sense, Nigerian companies have been able to increase their penetration in regional markets, ensuring greater competitiveness throughout the regional market.
Nigerian companies take the lead
Supported by the PIA, the Local Content Act and the opportunities created by the AfCFTA, local companies throughout the energy value chain in Nigeria have significantly improved their participation in the sector. On the service business front, companies like AOS Orwell, Nigeria's largest indigenous oilfield service company; Tecon Oil Services, which provides a wide range of services to exploration and production companies in Nigeria's upstream industry; and Century Energy Services Limited, one of the largest providers of operations and maintenance services in West Africa, have positioned themselves as key enablers of the growth of the Nigerian oil and gas market.
Meanwhile, on the upstream side, companies like the recently reformed NNPC and its subsidiary Nigerian Petroleum Development Company; Amni International Petroleum Development Company, active in a variety of offshore basins in West Africa; Emerald Energy Resources, an independent oil company with a vision to seek out and acquire profitable new reserves in Nigeria; Frontier Oil Corporation, a wholly owned Nigerian exploration and production company formed in 2001; South Atlantic Petroleum, a private Nigerian oil and gas exploration and production company with a portfolio of high-quality assets in West Africa; and Eroton E&P, an independent oil and gas producer that operates OML 18 in the Niger Delta, are driving Nigeria's exploration and production activities. These companies are leading the country into a new era of domestic market growth while increasing the penetration of Nigerian companies in regional markets.
With Nigeria having partnered with the African Energy Chamber (AEC) for the 2022 edition of the continent's premier energy event, African Energy Week (AEW) 2022, taking place from October 18-21 in Cape Town and under the motto "Exploring and investing". in Africa's energy future while fostering an enabling environment': the country's domestic market is poised to present a strong case for investment and development in West Africa. By participating in roundtables, discussions and networking functions, Nigerian companies will lead the dialogue and decision-making on Africa's energy future.
By NJ Ayuk, Executive Chairman, African Chamber of Energy (https://EnergyChamber.org/)
Beneath the coastal waters of Senegal and neighboring Mauritania lie some of the largest oil and natural gas discoveries in recent history, most occurring between 2014 and 2017. More than one billion barrels (bbl) of oil and 40,000 thousand million cubic feet (bcf) of natural gas resources awaiting extraction.
These discoveries have revitalized industry interest in the Senegal-Mauritania basin. However, despite the great potential, the understanding of how to make it a major production center is still evolving. Previous attempts to monetize smaller finds have failed. Production levels at regional facilities have declined over the last decade. While the consistently low-volume Gadiaga project remains operational in Senegal, at Mauritania's Deepwater Chinguetti project, production ceased entirely at the end of 2017.
The question of how to exploit these new reserves, especially considering that they cross international borders, is being answered in part through partnerships. The complexities inherent in fossil fuel ownership claims were addressed and amicably resolved in 2018 when the two countries agreed to the terms of the Interstate Cooperative Agreement that delineated equal shares of offshore resources. Local governments and workforces are ready for progress. They are eager to see the various fields in this area operating at full capacity.
However, the lack of existing infrastructure means that developing these projects will be a considerable undertaking requiring serious investment from committed partners. To further complicate matters, time is also a factor, and time is ticking. Mauritania, for example, needs to find a replacement for its iron ore mining business, which has provided a sizeable part of the national economy but is subject to the ebb and flow of demand from China, a key customer. A decline in the market coupled with an expected drop in the listing price would materially affect the nation. The tax gap could be filled by profits from liquefied natural gas (LNG) produced in Mauritanian fields, but only if production can be brought on board quickly enough to meet Europe's growing LNG needs, which are expected to peak. peak in the mid-2030s.
The problem is that neither Mauritania nor Senegal have the means to bring offshore gas to domestic markets or export LNG to international markets. Gas-to-power infrastructure on land is minimal at best. Successful monetization of the resources of this region is a goal that requires proportionate attention to address these shortcomings.
A recipe for success
As detailed in the African Chamber of Energy Petroleum Laws - Benchmarking Report for Senegal and Mauritania, there are opportunities for collaboration between local governments and international oil companies (IOCs) that would accelerate the development of these highly developed reserves. sea.
Although Mauritania may one day be connected to one of the three gas pipelines from Algeria to Europe, floating liquefied natural gas (FLNG) vessels offer a more immediate and affordable solution.
International pipelines, an unrivaled method of fuel delivery once completed, are accompanied by their own unique time-consuming difficulties during the planning stage. Any pipeline project must consider the potential for community displacement while also dealing with geological features and vegetation management issues. The risk of security issues is another factor. While Senegal and Mauritania have not struggled with security issues, it is possible that instability in other countries in the region, such as the Islamic insurgency in neighboring Mali, could spread and pose a threat to ground infrastructure. FLNG vessels such as those offered by Golar, New Fortress Energy, and Technip offer a reasonable way to bypass most of these obstacles.
A time to act
Despite these time-sensitive challenges, Senegal and Mauritania offer international oil companies (IOCs) an undeniably lucrative opportunity worth investing in. If the recent volatility in the European energy market is a forecast of circumstances to come, now is the time for international operators to build strong relationships in Africa.
Ideally, IOCs should build an infrastructure that supports all facets of African oil and gas production. LNG export terminals, maritime logistics operations and pipeline networks would all play a role in meeting the world's already huge and growing need for energy, especially natural gas. Large-scale spending like this is in the IOC's best interest, and Senegal and Mauritania extend a degree of cooperation found nowhere else in the world.
Mauritania's leadership has been proactively attracting international investment by relaxing restrictive trade regulations, developing a gas master plan and designating the port city of Nouadhibou as a gas processing, import and export hub.
In addition to establishing offshore exploration relationships with BP, Kosmos Energy and Mauritania's national oil company, Société Mauritanienne des Hydrocarbures et de Patrimoine Minier (SMHPM), the nation is also looking to develop onshore refineries in an effort to combat energy poverty. on a large scale. scale.
President Macky Sall has promoted and executed a plan to improve the international attractiveness of the country. Outlined in 2014, the Plan for an Emerging Senegal (PES) allocates billions to industrial infrastructure across the country.
Construction of a deepwater port in the capital city of Dakar began earlier this year, as did construction of the Ourossogui-Matam Airport in the northeast. Improvement projects have also started at Kedougou, Tambacounda and Ziguinchor airports.
As of last year, high-speed regional express train travel is available in Senegal, and an expansion of the Dakar-Diamniadio-AIBD toll highway is currently underway.
In addition, Dakar will host the MSGBC Oil, Gas & Power conference and exhibition on September 1-2 this year, where industry leaders will make the case for further international investment in Senegal and the region on the world stage.
Reinvestment: the cornerstone of sustainability
The African Chamber of Energy is strengthened by the remarkable and continued progress in the MSGBC basin. We consider success in the region to be a certainty, but only with monetization and reinvestment in infrastructure will that success be lasting.
We encourage the governments of Senegal and Mauritania to remain vigilant in monetizing their reserves. Each step of the gas value chain should generate revenue, and a portion of that revenue should further finance infrastructure development in the country.
Global demand for natural gas is already strong, and that demand is increasing with each passing season. Senegal and Mauritania are in a unique position to meet their national energy needs while meeting those of Europe and beyond. Decisive action now combined with committed long-term partnerships will ensure that this goal is achieved.
Mr. Lawrence Ewhrudjakpo, Lieutenant Governor of Bayelsa, urged the Ijaw National Congress (INC) and the Ijaw Youth Council (IYC) to play a critical role in combating terrorism and drug abuse in Ijaw land.
The lieutenant governor made the appeal Friday in Yenagoa when INC Central Zone officials led by its president, Mr. Doodei Week, paid him a courtesy call.
Ewhrudjakpo expressed concern about the rate at which young people were taking drugs, saying they were destroying their futures.
According to him, there has been a sharp increase in drug use in Bayelsa in recent years, with available statistics indicating an increase from 5 percent in 2018 to 15 percent today.
The lieutenant governor said the rate of substance abuse and other related crimes in the state has reached an alarming level.
“Drug abuse is another problem that I would like to see the government join in addressing in our various communities.
“Our area (state) has become number three in the country in drug use.
The rate at which our young people are getting high is quite alarming,” she said.
Therefore, he implored the two Ijaw organizations to collaborate with the State Committee on Drug Abuse to make young people aware of the dangers posed by the threat.
Ewhrudjakpo also asked them not to get carried away with sentiments on the issue of artisanal oil refineries degrading the environment of the Niger Delta.
He said that the artisanal refineries have caused more damage to the environment in the Niger Delta than the International Oil Companies (IOC).
“Our environment has been shattered, terrorized and almost completely destroyed.
Our youth are involved in transactions that are causing greater harm to our environment than what the IOCs are doing.
“The INC and IYC cannot afford to stand by or allow themselves to compromise with the crumbs of the oil supply and the illegal crude oil refining traders.
“If you go to some of our communities where these activities are taking place, you will feel sorry for them and the people who live there,” he said.
He attributed some of the diseases suffered by the inhabitants of the area to "these criminal activities of environmental abuse."
“People who do this are flaunting wealth or waving opulence at us, but the truth is we are all dying in installments.
"If we don't stand up and fight this for any overriding consideration, we will leave behind no environment for our children to enjoy," he said.
Previously, Week had assured that they were ready to partner with the government to ensure peace, unity and stability in the Bayelsa and Ijaw lands in general.
He praised the state government for its laudable peacebuilding efforts and projects across the state, despite declining resources.
Week encouraged the administration to stand firm in advancing its development agenda, assuring that the pan-Ijaw body would continue to support him to do better.
By NJ Ayuk, Executive Chairman, African Chamber of Energy (https://EnergyChamber.org/)
In a context of continuing global economic chaos, any information that suggests stability is welcome. That is why the details on African oil and gas capex contained in the African Energy Chamber's upcoming Q2 2022 Oil and Gas Outlook Q2 report is such welcome news.
In the short term, says the report, CAPEX will remain stable. Considering that spending across the sector has been trending upwards since hitting its lowest point in 2020, going from a low of $22.5 billion to a projected $30 billion in the first quarter of 2022, simply maintaining the status quo is an achievement.
But, as the report suggests, the prospect of even better results looms. And not in the distant future, but in the next few years.
From 2023 to 2025, CAPEX growth is expected to pick up sharply, eventually reaching approximately $52.7 billion. Although the terminal year figure is slightly lower than previous forecasts, it's hard to find fault when spending rises so significantly in the space of three years.
As for what is driving the increase, the prevailing force is global demand for liquefied natural gas (LNG). LNG is rapidly replacing the energy sources that produce the most greenhouse gas (GHG) emissions, and it is worth the European Union recognizing natural gas as a "clean energy" for sustainability and investment purposes. Experts believe global demand for LNG will reach 700 million metric tons per year (mpta) by 2040, nearly double the 2022 figure and a 90% increase from 2020.
The fact that the dramatic increase in demand coincides with the great discoveries of new gas offshore Africa points to an opportunity like never before. The moment, as they say, is in the money.
Sub-Saharan spending drives Africa's CAPEX
It's no surprise, then, that spending on new installations is on the rise and is likely to exceed estimates that were made a few months ago. According to the second quarter report, most of the approved projects are in the sub-Saharan region, where Mozambique and Uganda lead in terms of investment. (Neither country has been stagnant so far, of course. For example, Mozambique is currently in the final stages of Africa's first deepwater LNG project, the Coral South floating liquefied natural gas (FLNG) facility in the Basin. of Rovuma).
Additionally, several other nations including Congo, Senegal and Mauritania have also increased their greenfield outlays as they prepare to flex their muscles in the LNG market. Two major projects will already be launched in 2022-2023: Greater Tortue Ahmeyim FLNG Phase 1, on the maritime border of Senegal and Mauritania, and the large-scale Marine XII Fast LNG facility in Congo.
While the current market growth is uniquely timely for new producers, we cannot overlook countries that have been involved in the global natural gas/LNG trade for decades, including OPEC members Egypt, Algeria and Nigeria. . They top the list of the 10 largest producers in Africa, a group that, in the coming years, will export 50% of its gas flows internationally as LNG. Egypt, Algeria and Nigeria together are expected to account for 80% of African gas production from 2022 to 2025. (Libya, also a top 10 gas producer, will not export LNG.)
It is also important to note that Europe has been looking at supplies from Africa as a substitute for Russian gas in the wake of that country's war against Ukraine. To facilitate transportation, plans are underway for a Nigeria-Morocco pipeline project that will supply Nigerian gas to 15 West African countries, meeting much-needed domestic demand, and then reach Spain via Morocco. The project is still in the initial engineering stage. In addition, the $13 billion Trans-Saharan Gas Pipeline, a stalled decades-old project intended to bring African gas to Europe, appears to be moving forward again. During a two-day meeting in June, Algeria, Niger and Nigeria established a working group for the project and created an entity to update the feasibility study for the pipeline. When completed, the 4,128 km pipeline will start in Nigeria and end in Algeria, where it will connect to existing pipelines reaching Europe.
There is no doubt that the world needs more investment in low-carbon solutions to reach its net-zero emissions goals. Renewables may eventually provide much of the solution, but we're not quite there yet. In the absence of a mature industry to completely replace fossil fuels, natural gas and LNG, and specifically African natural gas and LNG, are increasingly seen as a bridge to an accelerated energy transition.
However, to play a major role in reorganizing gas supply sources, Africa also requires more investment. Participation in upstream projects is needed to exploit new finds while reducing stranded gas and infrastructure gaps throughout the value chain. The time is right for international oil companies (IOCs) to pay attention to this new competitive opportunity. And that is true even in the face of climate activists seeking to undermine African oil and gas investments.
To improve the stakes, African nations are working to create enabling environments for IOCs based on best practices from other producing countries. Look no further than Senegal, which has reformed its regulatory framework and is facilitating international investment in its recent natural gas discoveries, for a good example.
The government created the Committee D'Orientation Stratégique (COS PETROGAZ) to regulate the activities of the sector and guarantee both transparency and good governance. The entity operates directly under the auspices of the President of Senegal, Macky Sall. Senegal also developed a training center called the Institut National du Pétrole et du Gaz (INPG), or National Petroleum Institute. INPG's purpose is to recruit and prepare thousands of local workers, from engineers and geologists to technicians, to play a significant role in the industry. Not only is this expected to reduce reliance on expensive foreign staff, but Senegal also hopes it will spawn indigenous companies that can eventually take the lead in Senegal's energy transition.
In addition, the country has prioritized the equitable distribution of income from its energy sector. Senegal's agenda allows the COIs to benefit from its participation, while the government earmarks a fair share of the proceeds for its own uses, including supporting current education and health care needs and investing a percentage for future generations. .
These initiatives have already attracted additional interest from IOCs and have boosted foreign direct investment (FDI). In fact, between 2019 and 2020, the year work began on offshore oil and gas fields, FDI grew 39% to $1.5 billion.
The reality is that although we are in a strategic period where we can leverage our resources for export, we will continue to need increasing amounts of natural gas and LNG for ourselves. Despite efforts to improve Africans' access to electricity, for example, the number of our citizens living without it is growing, not shrinking, and the continent's demand for energy is only increasing. In fact, it is estimated that by 2040, Africa will need 30% more energy than today.
We are fortunate that Africa has been endowed with vast gas resources. According to the International Energy Agency (IEA), the continent has more than 5,000 bcm of natural gas reserves that have not yet been approved for development. The IEA says those resources could provide an additional 90 bcm of gas a year by 2030. That's a lot of energy for electricity, feedstock for fertilizers and manufacturing, including domestic consumption, which currently accounts for two-thirds of the continent's output. With this, we can make energy poverty go down in history and create opportunities for women and youth.
But that will also require investments in pipelines and gas-fired generation and processing facilities. Fortunately, today's capital spending on African oil and gas can generate revenue streams that will provide the funds to build those pipelines, processing facilities, and power plants. In essence, they are setting the stage for a brighter future, in every way.
By NJ Ayuk, Executive Chairman, African Energy Chamber (www.EnergyChamber.org)
As I mentioned before, when it comes to competing to be one of the new natural gas suppliers to the European Union, Senegal and Mauritania have several advantages.
One, they have geography on their side. Its location should make it easier and more efficient to deliver liquefied natural gas (LNG) to regasification terminals in European port cities than it would be for more distant African nations, such as Mozambique, which is scheduled to begin LNG production. later this year. .
Second, they have demand on their side, as the EU is keen to create a more diverse roster of multiple suppliers, each capable of replacing some of the large number Russia has been delivering on its own. Senegal and Mauritania are set to start production when European memories of fuel supply anxiety are still quite fresh, so they will be in a good position to establish a strong trade relationship. This creates an obvious advantage for Senegal and Mauritania, as strong demand generally pushes prices up.
And three, they have time on their side. EU officials want Russian gas imports from the bloc to be cut by two-thirds before the end of this year, and Senegal and Mauritania plan to bring their first export-oriented gas project, Greater Tortue/Ahmeyim, online. GTA), in the third quarter of 2023.
But this combination of advantages will not be permanent. Okay, the geography won't change. We can assume that the distance between Dakar and Europe will remain the same during our lives. But gas demand and the timing of new greenfield projects will change. The EU will not always conduct as critical a search for new gas suppliers as it is doing now, and African gas producers will not always be launching new fields at such auspicious times.
Consequently, Senegal and Mauritania should be thinking of the big picture. As we stated in our forthcoming report, Laws of Oil - Benchmarking Report for Senegal and Mauritania, these countries should ask themselves questions, not only about how to use their resources to meet the needs of the moment, but also how to optimize their resources. resources and maximize long-term returns.
Here are two of the big questions that I think are worth asking, and the answers that the African Energy Chamber (AEC) would give.
Do the gas development plans focus mainly on exports, or do they also contemplate the creation of local and regional gas markets?
The House certainly believes that African gas projects should have as many African components as possible. This is why we favor partnerships between International Oil Companies (IOCs) and their African counterparts, partnerships that involve training programs and the transfer of skills and technology. This is why we favor local content policies that are designed to support service companies in sectors where African providers have and can take advantage.
That is also why we favor the establishment of gas-based industries within Africa. We believe that gas-producing states should have the right, and the opportunity, to use their own resources not only to earn foreign exchange, but also to transform their own economies.
So while Senegal and Mauritania are working with IOCs to boost gas development and exports, they should also be making plans for domestic gasification. They should think about bringing gas ashore, where it can be used as fuel for power plants, as a source of energy for industrial facilities, and as a source of feedstock for petrochemical plants. These are all things that can create jobs, eliminate energy poverty, and raise living standards, thereby improving people's lives!
Fortunately, Senegal is already taking steps in this direction. Chairman Macky Sall has already revealed plans to use most of his share of gas production to improve domestic electricity supplies. The state-owned natural gas company, Senegal Gas Network (SGN), led by former Petrosen exploration and production director Joseph Medou, has said it will build an onshore pipeline to transport a portion of production from offshore fields to five thermal power plants (TPP) on land. that are currently burning dirty residual fuel oil. SGN appears to be hoping to finish this pipeline in 2024, around the same time that work on four new TPPs is due to be completed. This is also around the same time that Senegal's second offshore gas project (Yaakar-Terenga, once again run by BP in partnership with Kosmos Energy) is supposed to start production.
So far so good! The ACS is genuinely encouraged by Senegal's progress on this front to date. But it is also hopeful that the country will further explore gasification programs in the future, given that such programs can have a powerful multiplier effect on the local economy.
In practical terms, if Senegal really wants to optimize its gas resources in the long term, it should act now to make gas the mainstay of its own economy, perhaps looking beyond electricity generation and into petrochemicals or another manufacturing sector based on gas. in gas. And you need to make sure that BP and the other IOCs working offshore are providing the right kind of help to make it happen.
Do gas development plans have the flexibility to respond to future changes in global energy markets?
Once again, the AEC believes that it is not enough to plan for the needs of the moment. Africa's newer gas producers must also look to the future and think about how they can optimize their resources in the coming decades, when global energy markets will be driven by forces beyond current factors, such as war. of Russia against Ukraine.
That is why it was encouraging to see that Mauritania signed a memorandum of understanding (MoU) last December with New Fortress Energy (NFE) on the establishment of an offshore energy center capable of using natural gas to support the production of LNG, electricity and blue water. ammonia fuel The document is not binding, so it does not guarantee that this project will come to fruition. But it paves the way for the country to do several important things.
First, it puts Mauritania in a position to equip its offshore power center with NFE's “Fast LNG” technology. With this technology, the country will be able to install modular units on a jack-up drilling rig or other legacy offshore infrastructure to establish a medium-sized gas liquefaction plant, and it will be able to do so more quickly and cheaply. than it would be if it opted for a more conventional solution, such as an onshore LNG plant or even an FLNG vessel like the one BP and Kosmos will use in GTA. In addition, you will be able to increase LNG production if you decide to do so by installing additional modules. As a result, Mauritania will not be just another producer and exporter of LNG; it will also be a low-cost LNG producer and exporter with the flexibility to respond quickly if growing demand warrants additional investment in production capacity.
Second, the MoU makes provisions to expand Mauritania's national electricity supply. It requires the offshore power hub to deliver gas to Nouakchott Nord, an existing 180 MW TPP in the capital city of Nouakchott, and also to a new 120 MW combined cycle TPP that national power provider Somelec plans to build. With this new generation capacity, Mauritania will be in a position to offer its citizens a better life and offer job-creating companies a more attractive operating environment. Also, by emphasizing gas-fired power generation, you will be able to reduce pollution. Currently, the Nouakchott Nord plant's main fuel is residual fuel oil (RFO), which burns much less cleanly than gas.
Third, the project may be based on natural gas, but it also looks towards a fuel of the future, and by that I mean ammonia. As mentioned above, the power pole will have a blue ammonia unit, in which natural gas will be used as raw material for ammonia production. This facility will help establish a market for ammonia, thus laying the foundation for future production of green ammonia, that is, ammonia made from green hydrogen produced from renewable energy.
Mauritania will benefit from this expansion of its renewable resource capacities, as it has tremendous solar and wind potential as well as significant gas reserves. The benefits may not be immediate, as that potential will take longer to realize, but they could be very substantial, especially if the country achieves its goals of increasing the share of renewables in the energy mix to 50% by 2030 and developing multiple large-scale green ammonia and hydrogen projects.
Senegal and Mauritania look to the future
In general, Senegal and Mauritania deserve praise for their approach to gas development.
Not only are they on track to become two of the first new gas producers in Africa to join the list of EU gas suppliers, they are also taking steps to optimize the use of their resources.
They are making plans to use their gas to produce electricity for the domestic market, not just to earn dollars on the export market.
They are taking advantage of the flexibility inherent in new technologies offered by foreign partners such as NFE.
And they are thinking about what comes next: what will happen when the world goes from gas to renewable energy. And for that, the AEC commends them.