Catalysts: Growing Population Creates Demand
The theme of Africa Oil & Power 2017, Catalysts for Change, encompasses the major changes that African governments and firms are undergoing in 2017, and the significant developments in the oil, gas, power and finance industries in response to the oil and gas price down-cycle. We asked the leading voices in the African oil, gas and power business to give us their views on the drivers for change in the energy industry.
Principal, Head of Oil & Gas Corporate Finance Advisory – Sub-Saharan Africa
Obviously, a rapidly growing population and the resulting growing energy demand will be important and create increasing demand for refined products on the continent. For me, one of the big theme will therefore be the increasing demand for refined products, which will require new infrastructure to import, store and distribute petroleum products across Africa.
Another catalyst is natural gas for domestic use. In this light, you see the huge offshore gas discoveries in Mozambique starting to be developed. FID has at last been reached on Coral FLNG in Area 4, and I think this will certainly be a catalyst for change, especially for Mozambique and the Southern Africa region. The development of these resources could transform the economy of the region by substituting a large proportion of the energy mix, which is presently very heavy on coal, with more environmentally friendly natural gas.
General Manager for Sub-Saharan Africa
This is a timely question. It may sound self-serving, but I think the sector that is most important right now and most important to invest in in Africa is energy. That is because the second-most important sector to invest in is manufacturing, which is the way to get to a middle class — creating jobs and a middle-income society. But the manufacturing sector cannot operate on generators.
Africa has every other component to be really competitive — world-class ports; access to open transportation; a smart, young population that needs jobs, etc. So, if we have electricity, Africa is unstoppable. I think the governments need to step back a lot more, in order to let investment come in and let capitalism drive that process.
I really see investment in power generation as a key catalyst for change.