The Energy Republic February Edition 2022

TOP STORY
attractive to investors — as the government
aims to build an upstream sector—than in
countries with a mature upstream industry.
"Such terms ultimately lower the economic
threshold investors must deliver to their
shareholders for a discovery, a benefit which a
large discovery only amplifies".
Africa's Evolution on Gas Development
Africa is blessed with abundant energy
resources and Gas will play a pivotal role in the
Continent's energy mix.
According to the African Energy Chamber
report, Algeria, Egypt, and Nigeria round o ff
the top three natural gas producers in 2022
contributing to just over 80% of the overall
natural gas flow from Africa. Both gas demand
and gas production has consistently grown
over the last decade, representing a trend that
is expected to continue going forward as global
decarbonization efforts intensify.
NJ Auk, Executive Chairman of African Energy
Chamber, said Africa can build a better
economy with Gas.
"I have always said if we are going to discover
oil and gas resources again, I would prefer
Africa discover Gas. What we have seen in the
oil economy hasn't worked in Africa. If we had
focused on Gas development, we could have
done more in terms of industrialization and
monetization.
“
Gas is really important
now as we have climate
change issues. Gas is
the transition fuel
because it is cleaner.
“African countries who have an abundance of
these resources should monetize their gas
resources.
"25 years ago, Africa saw Gas as a disaster.
Today, it is a bonanza. We are seeing
discoveries of Gas in countries like Gabon,
Congo. These explorers are going right back to
drilling because the Gas market is huge.
"The market forces will determine how Gas is
going to be important to drive more
investment to the sector.
"But, we need to be very careful as we are in an
era where we are seeing a shift in investment in
fossil fuels which affects Gas. If we don't have
the right kind of investment and financing
framework to develop the abundant Gas
resources in Africa, we are going to see this
Africa potential bonanza as a miss which we
cannot allow such thing to happen to Africa".
More so, LNG-to-Power has been identified as
new opportunity to unlock energy access for
power generation and other economic
developments. LNG is available for power
generation almost everywhere with access to
the sea or a receiving LNG terminal system.
Compared to liquid fuel, LNG to power solutions
provide 20 % lower CO2 emissions, 90 % lower
NOx emissions, 97 % lower particle emissions,
and a 100 % reduction in SOx emissions.
According to NJ Ayuk, LNG-to-Power is going to
be another new opportunity for Africa. It
requires infrastructural development, and it
creates a different kinds of multiplier effects
around the value chain.
"LNG-to-Power projects are needed right now
in Africa. The Tema LNG project in Ghana, the
first offshore LNG receiving terminal in sub-
Saharan Africa stands as a case study for Africa.
"We need to extend it to Nigeria, Angola,
Mozambique including South Africa. There is
going to be massive LNG development in Africa
but we need to develop the right kind of
infrastructure because it is cleaner, better,
competitive when it comes to pricing and it will
become a long-term power infrastructure that
will power up industries as well as improve the
lives of people," Ayuk said.
Small Scale LNG: Experts have said that the
advancement of Small Scale LNG will become
another growth opportunity in Africa in
bringing energy access and fueling the local
industries in the region where it is needed.
Because LNG burns more cleanly than other
fossil fuels such as petroleum and coal, Small
Scale LNG is likely to gain further traction as
market and regulatory pressures to transition to
lower-carbon energy intensify. As companies
approach the Smal Scale LNG market, Africa
should be prepared to act quickly.
Small-scale liquefaction plants are usually
developed to serve specific markets and have a
production capacity of less than 500,000 tons
NJ Auk, Execu ve Chairman of African Energy Chamber
per year (by contrast, a large industrial-scale
LNG plant like the Gorgon facility has an export
capacity of approximately 16 million tons per
year).
In his words, NJ Ayuk explained that Small Scale
LNG will play a major role in unlocking energy
access in Africa.
He added, "In Africa, we always talk about local
content and opening opportunities for
indigenous companies who cannot raise the
big-ticket items in funding projects. With Small
Scale LNG, these companies would be able to
run LNG programs in badges.
"You don't need something big. With badges,
you can move it from regions where there are
LNG terminals. For example, Equatorial Guinea,
Nigeria, Mozambique, Angola, and other
African countries would become part of the
business.
"Our industries will not work when we don't
have the Small Scale LNG players all around.
Small Scale LNG will become a game-changer
for the African Gas sector.
"Gas is our future and monetizing LNG is going
to be our path to prosperity in Africa.
"Africa should start adopting new technologies
to further explore these opportunities. This is
the time for Africa to take responsibility for
regional collaboration in energy, gas, LNG
development.
"African countries and businesses are already
benefiting from LNG projects in the continent.
African natural gas is plentiful, and also low-cost
to develop if bureaucrats just do their job and
cut red tape and provide the incentives needed.
"African natural gas has an abundant cheap
supply that could easily displace coal and higher
intensity fossil fuels and provide uplift for
African countries and our global partners.
"We have a chance to push greener and
cheaper energy both in Africa and globally,
30
THE ENERGY REPUBLIC I SPECIAL EDITION