The objective of the event was to serve as a knowledge exchange forum and provide a networking platform for key players in the African energy space to connect to project developers and financiers. With a keynote speech by Adegbite Falade (CEO, Aradel Holdings) and a panel discussion led by Dr Gabriel Onagoruwa (Partner, Olaniwun Ajayi (UK) LLP), the event was an opportunity to discuss topical issues in the sector and gain insight into how other market players are solving these issues.
As Europe looks to diversify away from Russian gas, panellists from Afrentra, BP, Chariot, SLB and Tullow Oil Plc were asked what role Africa will play in offsetting Russia’s exports.
Given the disruption in the energy market caused by Russia’s invasion of Ukraine, western regions will need to look beyond Russia to source gas, and the African continent is well placed to meet this supply gap, argued the panellists. Africa has proven reserves of about 685 trillion standard cubic feet (SCF) of gas, 30% of which is in Nigeria. In fact, the gas reserves in Nigeria alone can achieve comparable levels to the reserves in the United States of America if fully prospected. Other key players in the African gas market are Algeria, Mozambique and Egypt and the frontier regions of Tanzania, Senegal and Namibia.
Although the outlook is tentative, panellists said the demand for natural gas from Africa is expected to grow by about 25% and the demand for LNG from Africa by about 60% in the next few years, which will represent 75% of the global energy demand.
Panellists also looked at what production capacity will look like across the continent in the next five to ten years and what impact this will have on the global energy markets.
The discussion highlighted the crucial role independent indigenous companies have in plugging the energy deficit within Africa and retaining value on the continent. Planellists also pointed out that it’s necessary to develop local markets for energy products, and in this context regional integration is key.
Pipeline infrastructure will be another crucial focal point if Africa is to become a reliable supplier of gas for western economies. One example of this is the AKK pipeline in Nigeria which represents phase 1 of the Trans-Saharan Gas Pipeline (TSGP) required to transport natural gas to Europe.
It is also important to balance global demand and development at a local level. Panellists pointed out that capacity building and retention on-continent is vital, and that local, regional and international companies can have an impact by sponsoring education in-country, pushing domestic development objectives, and investing in technology to ensure cleaner and more sustainable processes.
They also explained that regional projects (right from exploration stage) need to keep bankability at the forefront of their structuring.
Olaniwun Ajayi (OA) is the go-to law firm for African transactions including key energy transactions which are vital to the development of the continent. The firm has proven expertise in project finance transactions and has successfully closed six major energy transactions since its inception in December 2021. Having a room full of key players who will shape the future of the African energy sector aligned strongly with the firm’s vision.
One of the key takeaways from the event was the importance of building a local market and developing regional pipelines to service regional energy deficits. Panellists pointed out that this should be a top priority, as much as serving as a plug for global supply gap.
To join Africa Legal's mailing list please click here