By Bassey Udo
The world will require0 annual investments of an average of $60 billion to create access to electricity and clean energy supply, Minister of State for Petroleum Resources, Timipre Sylva, has said.
The Minister stated this in a speech presented on his behalf by his technical assistant, Gas and Business, Justice Derefaka, at the annual Symposium and Exhibition of the Society of Petroleum Engineers (SPE) in Lagos on Tuesday.
While about $35 billion could bring electricity access for 759 million people around the world, particularly in Africa, Sylva said another $25 billion investments wkuld be needed every year to help 2.6billion people gain access to clean energy for cooking between now and 2030.
Sylva said the required investments represent only a small fraction of the multi-trillion-dollar global energy investment needed overall under the global eneegy transition.
United Nations Economic Commission for Africa (UNECA) in a report noted that Africa, which is home to one-sixth of the world’s population and one of the world’s most affected regions by climate changen, needed about $40 billion worth of investments every year, if it was to meet its energy supply needs.
“Everyone in the world could have access to clean, affordable energy within the next nine – ten years if countries modestly increase investments, according to the UN’s Department of Economic and Social Affairs.
“A major question that is yet to be
answered is whether Africa will benefit from an equitable share in this global investment and growth or, will continue to fall further behind global standards as encapsulated in the UN’s 17-SDGs,” Sylva said.
Despite the long-term and required drop in demand for fossil fuels, he said short-term demand and prices remain robust, providing strong commercial justification for their extraction and a need to smoothen the transition.
Despite contributing less than 6 percent of world’s energy consumption and 2 percent of total global emissions, the Minister said there was the need for the continent to shift attention to cleaner energy use.
With significantly untapped fossil fuel reserves, which could provide much-needed foreign direct investment and export revenue, Sylva said Africa has the ability to play a leading role in the transition to a net-zero energy future.
The continents enormous resources, he noted, could be harnessed using clean energy technologies.
With “approximately 208.62 trillion cubic feet (TCF) of proven gas valued at over $803.9 trillion and potential upside of 600TCF of gas, he said Africa has the most extensive gas reserves, and in the top 10 globally.
“And in line with Federal Government declaration of years 2021 – 2030 as the ‘Decade of Gas’, we are taking steps to expand and develop the nation’s huge gas resources through enhanced gas exploration, development and utilisation schemes which will lead
to gas reserves growth, increased gas production, maturation of the domestic and export gas market, as well as gas flare elimination,” he said.
Describing the Petroleum Industry Act (PIA) as a game changer, Sylva said the legislation would help support the continent to alleviate energy poverty.
The PIA, he pointed out, has generous incentives to enable development, distribution, penetration, and utilisation of gas, even as it incentivizes entry into the midstream, especially for pipelines, with an additional 5-year tax holiday for investment in gas pipelines.
“The PIA is a supply-side enabler, capable of provoking and triggering commercial interests and investments in gas utilization as well as treating gas as a stand-alone commodity.”
“As a nation, we are following a transition pathway that combines technology, investment, business strategies, and government policy that will enable Nigeria to transition from its current energy system to a low-carbon energy system with natural gas playing a pivotal role over the next generation, roughly between now and 2060.
“Natural gas is a key resource for a
just energy transition and has all the credentials to support Nigeria and
indeed Africa meet up with her commitment with the UN 17 Sustainable Development Goals (SDGs).
“As a major source of wealth and energy in Africa, the development of oil and gas resources proves critical for our economic growth and revenue expansion,” he added.
The minister insisted that there must be multiple pathways to the energy transition, to ensure that no country was left behind in the process of achieving net-zero by 2060.
“As a continent, we need to be
intentional and recognize the need to develop hydrocarbon resources in
environmentally and socially responsible ways.
“And as alluded to by the African
Union, we need to be realistic in choosing the energy transition pathways which addresses our unique requirements and circumstances. As well as enhancing
policy, legislation and implementation approaches across national, regional, and continental level, to enable a favorable environment for development.
“We need to develop bankable projects to scale up access to funding and investment. And adopt a mix of energy solutions to address the needs of each country including solutions to high tariffs and accessibility to sustainable energy options.
“We need to promote energy efficiencywhich is necessary for energy transition and focus on building energy infrastructure and strengthening transmission corridors,” Sylva said.
The SPE annual symposium and
exhibiton was on the theme “Energy
Transition In Africa: A Strategic Pathway To Net Zero.”