Opinion by Imaduddin Ahmed and Gareth Walsh
Published on April 29, 2022 | African Business Magazine
With the breakdown in relations with Russia endangering gas supplies, the West should rethink its policy on embargoing development finance for gas deposits in Africa.
Europe’s dependence on Russian gas must reduce. Developing African gas offers a way to do this while also advancing economic development and food security in one of the poorest parts of the world. To achieve this, the West must revisit its policy on embargoing development finance to upstream gas development.
In the lead-up to Cop26, the UK and US announced they would no longer offer concessional finance for the development of upstream gas. This was not welcome news to governments in sub-Saharan Africa, where a third of the world’s new gas deposits have been discovered in the past decade.
Gas from those deposits could both enable industrialisation and increased agricultural productivity driven by use of fertiliser, and hence food security and economic growth in the region. It could also reduce European dependence and vulnerability on Russian gas without resorting to coal, and without continuing to pay Russia €200-800m daily.
Europe’s need to diversify its energy supplies has seen it scour the globe for alternate gas suppliers; even then, in the short to medium term, it is unlikely to be enough to completely wean off Russian gas without extending the life of coal power plants and facing recession. Nuclear remains politically untenable and renewables are technically unfeasible due to intermittency and lack of storage.
African gas can redress balance
Developing gas resources in and buying gas from African countries would redress an imbalance that favours countries which developed their gas resources first and have contributed the most to the stock of greenhouse gas emissions. Mozambique, Tanzania, Senegal and Mauritania, on the other hand, have significant reserves and have contributed virtually nothing to global warming.
The risk that new investments in these countries would either clash with climate targets or result in stranded assets before investment returns can be recouped would be mitigated if European governments committed to wean themselves off gas starting with purchases from the first gas producers, as technology improves to allow more renewable energy on grids, or as acceptance for nuclear power grows.
Besides helping Europe avoid destructive coal, gas is vital to support industrialisation and food security in Sub-Saharan Africa, where one in five are undernourished, GDP per capita is 35 times less than it is in the EU and the majority are without electricity. A prerequisite for industrialisation, the only proven path to economic development for non-tax havens, is low-cost and reliable power. Given an increased incidence and intensity in droughts, the scope for hydropower is shrinking.
Until other technologies improve, gas is the least harmful medium-term energy source from climate and economic perspectives for many drought-affected countries. It can displace coal. And with its low costs of switching on and off, it can be used to increase power generation by intermittent renewable energy sources, solar and wind.
In the implausible scenario that if overnight 48 Sub-Saharan African countries tripled their electricity consumption, and that 100% of that power came from natural gas, the additional consumption would only contribute to 0.6% of annual global emissions.
A pre-requisite for food security is the use of fertiliser, for which gas is a vital ingredient. On average, use of fertiliser in sub-Saharan Africa per hectare is less than a seventh of the rate used in high-income countries. This must increase if the food-security issues that have been caused, in part, by the past century of unabated carbon emissions from high-income countries are to be mitigated.
Supporting African gas development
With the breakdown in relations with Russia at odds with the West’s dependency on Russian gas, and given the imbalance of contributions to greenhouse gases, the West should reconsider its embargoes on supporting the development of African gas deposits.
Funding gas development would further enable Western aid money to ensure that the latest and most effective methane and carbon capture technologies are deployed, while at the same time supporting a tried and tested path for economic development.
Accompanying the finance should be production sharing contracts that apportion fair levels of proceeds to African countries; and ensuring good governance and transparency in the accounts of gas companies with the expertise and capital to develop gas resources, so that they are unable to defraud host governments of their envisioned share of profits and taxes.
Such support should also be provided to host governments to ensure good development outcomes for the citizens they represent.
Support should further be provided for managing the influx of hard currency from gas sales, so that host country’s nascent value-adding industries are not priced out of global markets.
The authors are Energy and Climate Advisors at the Tony Blair Institute for Global Change, a not-for-profit organisation which supports political leaders and governments to build open, inclusive and prosperous societies in a globalised world.
energy and a just transition 
https://news.mongabay.com/2022/08/as-europe-eyes-africas-gas-reserves-environmentalists-sound-the-alarm/
As Europe eyes Africa’s gas reserves, environmentalists sound the alarm
by Ashoka Mukpo on 19 August 2022
In the wake of an energy crisis caused by Russia’s invasion of Ukraine, European countries are turning to Africa for its natural gas reserves.
The move is a turnaround from recent years, when many of the same countries vowed to stop financing fossil fuel projects on the continent.
Some African heads of state, along with their allies in industry, have welcomed the change, saying gas extraction will help finance the transition to renewables.
But environmental advocates on the continent are pushing back, saying that a new era of fossil fuel extraction will create more misery and harm the climate.
It was a victory for African climate campaigners and their allies in Europe and the United States: a group of powerful countries and institutions including the U.S., Canada and the European Investment Bank announced at last year’s COP26 climate summit in Glasgow, Scotland, that they would end decades of support for oil and gas projects in Africa by the end of 2022. Coming on the heels of a World Bank commitment to start phasing out support for fossil fuels, it looked like a potential death knell for plans to exploit vast quantities of natural gas in Senegal, Mozambique and Nigeria.
And then Russia invaded Ukraine.
In the span of less than a year, gas projects in Africa have come back in style, as European countries scramble to make up for energy shortfalls caused by their standoff with Russia. In late May, for example, German Chancellor Olaf Scholz traveled to Senegal for talks with President Macky Sall over his interest in securing a steady supply of gas from the country’s BP-backed offshore fields. And on Aug. 16, Reuters reported that the EU plans to significantly ramp up security assistance for Mozambique’s troubled Cabo Delgado gas project, which in recent years has been the site of a deadly Islamist insurgency and at one point not long ago was thought to be on life support.
To some African governments, the turnaround is welcome, representing a needed course correction away from climate restrictions that threatened to block their plans to use gas reserves for economic development and boosting energy access for the poor. In a speech at Glasgow last year, Nigerian President Muhammadu Buhari criticized the COP26 announcement, and earlier this year in an op-ed for The Economist his vice president, Yemi Osinbajo, wrote that Africa “cannot accept regressive climate policy as another injustice.”
Nigeria has the continent’s largest proven natural gas reserves, followed by Algeria, Senegal, Mozambique and Egypt. All are advocates for the use of natural gas as a “transition fuel,” which their leaders say will facilitate economic development and help smooth the way for investment into renewables like solar, wind and hydropower.
The needs are clear: access to energy in Africa is far lower than in other regions. More than 600 million of the continent’s 1.3 billion people live without electricity, and despite having only one-tenth the overall population, in 2019 Japan alone consumed more power than all African countries combined did.
But as their presidents ink deals behind closed doors, civil society organizations on the continent are pushing back, most recently at the African Union, where an “African Common Position on Energy Access and Transition” calling for natural gas to be part of Africa’s energy strategy was adopted by the AU’s Executive Council. In an open letter, a coalition of advocacy groups said the position was “dangerous and short-sighted.”
“It makes zero sense to pursue new oil and gas extraction, which will make the climate crisis worse and make achieving climate goals impossible,” said Thandile Chinyavanhu, a climate and energy campaigner with Greenpeace Africa. “The future is renewable, and African countries have the opportunity to lead the world into a new future powered by renewable energy, leaving dirty fossil fuels in the past and in the ground.”
A rendition of plans for onshore LNG infrastructure in Cabo Delgado, Mozambique, planned for construction by France’s TotalEnergies.
A detailed memo accompanying the letter criticized efforts to expand gas production, saying that additional fossil fuel extraction risked worsening the impacts of climate change in Africa and that profits were likely to again be captured primarily by foreign investors. The memo cited the continent’s decades-long track record of failing to develop through oil and gas extraction, describing it as “enabling small powerful elites to extract rents and maintain economic and political control, while their populations lack access to energy, food and other essential services and remain impoverished.”
“We’ve seen this in Nigeria and African countries with fossil fuel projects,” said Lorraine Chiponda, coordinator of the Africa Coal Network, one of the letter’s signatories. “You can see the poverty that even the communities that live in the same areas are suffering from, so it still doesn’t make economic sense.”
The letter’s authors criticized the idea that gas could be a bridge to a renewable energy grid. It was more likely, they wrote, that infrastructure like pipelines and gas-fired power plants would suck finance and attention away from green energy.
Some supporters of gas projects in Africa acknowledge the poor track record of natural resource extraction on the continent. In Mozambique, for example, the discovery of large offshore gas reserves was followed almost immediately by a massive corruption scandal that implicated senior officials as well as European bankers.
But analysts like Imad Ahmed, an energy and climate adviser at the Tony Blair Institute for Global Change, say that, with the right approach, those prior scandals could inform stronger policies that ensure foreign investors pay their fair share and avoid damaging the environment.
“By remaining financiers of gas development, OECD nations can ensure that these good governance structures are embedded into contractual obligations,” Ahmed told Mongabay.
Supporters of gas extraction point out that African countries are among the lowest per-capita carbon emitters on the planet, and that expecting them to forgo the use of their natural resources to clean up a mess made largely by former colonial powers is inherently hypocritical.
“The prosperity we experience in Europe is on the back of historic emissions. You can’t pretend that it isn’t,” Ahmed said.
Environmental advocates agree, but they say that the appropriate restitution would be for wealthier countries to provide the support and finance for the transition to renewables — as they have promised to do in the past — rather than doubling down on their history of exploiting the continent’s resources for their own gain.
“Even before the climate crisis, many communities and civil society groups in Africa and around the world were fighting fossil fuel exploration due to its impacts on people’s livelihoods and the increased poverty, human rights violations, land grabbing, and corruption it brings,” said Anabela Lemos, founder of Mozambique’s Justiça Ambiental.
Last year, Shell agreed to pay more than $100 million in damages for spilling vast quantities of oil in the Niger Delta during the 1970s.
Whether or not wealthy countries owe African countries compensation for climate change is likely to be a contentious issue at November’s COP27 climate summit, which will be held in Egypt. The G7 group of richest countries managed to keep the issue of “loss and damage” off their agenda at initial talks in Germany held in June, but most observers expect it to take center stage at COP27.
For many influential heads of state and business leaders in Africa, the reluctance of rich countries to provide adequate climate funding to their less well-off counterparts is itself an argument in favor of exploiting the continent’s gas reserves.
“Denying Africa’s right to develop and use its own gas is morally unacceptable,” said the Sudanese-British billionaire Mo Ibrahim earlier this year.
Despite their relative lack of resources and power, though, African environmentalists aren’t going down without a fight. In the wake of the controversy over the AU’s proposed pro-gas stance, the lead negotiators set to represent the continent at COP27 said they would not adopt it as their official position. It was a victory for the anti-gas coalition, but advocates say if Europe stays on its current course, it could usher in a new era of fossil fuel extraction in Africa — and make a green transition that much harder.
“For now the decision has been rejected, but it doesn’t mean that individual governments in Africa aren’t signing deals with governments in Europe,” Chiponda said. “So we have to continue pushing back on that.”