African Energy
Fuel for the future

The Western World has long been accustomed to continuous and virtually uninterrupted supplies
of fuel. Now Africa is poised to play a bigger role in global oil and gas export markets as new finds are made and investor confidence rises in the wake of the sector’s liberalisation by more democratic regimes.

Regional cooperation was at the forefront of the minds of energy ministers from 35 African countries when they met earlier this year to sign a convention for the creation of the African Energy Commission (AFREC). The aim of the organisation will be to promote cooperation in the energy sector across the continent through joint projects and harmonisation of policies.

Nigeria is boosting its oil exports and preparing to become a major gas exporter. The president of Africa’s most populous country, Olusegun Obasanjo, is determined that its abundant natural resources are fully exploited and that its people benefit from the revenues.

The country’s economy is the second-largest in sub-Saharan Africa, yet the United Nations ranks it among the world’s 25 poorest nations, with per capita income little more than $310. In the two years since Mr Obasanjo took office significant advances have been made.

To unlock the Nigeria’s energy wealth, a liberalisation programme is being put in motion to encourage greater foreign direct investment, give indigenous firms a solid legal framework to operate in the upstream sector and establish Nigeria as a world-class research centre.

High oil prices meant 2000 was a bumper year for the Republic of Congo, Africa’s fourth largest oil producer after Nigeria, Angola and Gabon, as it began a rebuilding process following the destructive civil war of the late 1990s.
Offshore exploration remains very active. Congo is banking on the deep offshore fields of Moho and Bilondi. At the same time, efforts are being made to increase downstream activities such as refining.

Oil revenues account for at least 60 per cent of the republic’s national budget, while 30 per cent is raised from taxes and customs duties, and the remainder from international aid.
In Egypt, the sector has been stimulated by discoveries in the Mediterranean basin and the country’s well established oil and gas industries have the opportunity to expand. More than 30 new blocks are being offered for exploration. In a bid to boost investment, an international oil conference will be held in the country in October next year.

Egypt is pressing ahead with its ambition to export gas. Plans were recently approved for gas to be supplied through a pipeline to Jordan – the first stage of a regional pipeline network aimed at exporting Egyptian gas to Syria, Lebanon and Turkey as well.
With the smallest known reserves of all four countries, Ghana will be inextricably linked with its neighbours when the West African Gas Pipeline project is realised.

The scheme will deliver a clean, affordable supply of energy in the form of gas from Nigeria’s Niger Delta. It is expected to be operational by 2005.
Meanwhile Ghana, which is making steady progress towards economic recovery under its new president, John Kufour, is pinning its hopes on new discoveries to realise its potential as a producer of oil and gas. Due to benefit from a $2.2 billion debt relief package under the Highly Indebted Poor Countries (HIPC) scheme, Ghana also needs to boost electricity generation to meet growing demand.