The Buzz: This Week in Africa
At the close of this week Brent Crude is trading at $53.01 per barrel, WTI at $50.70 per barrel and natural gas at $3.18 per million BTU (beginning of day 21 April 2017). Here are AOP’s top five stories from the last seven days.
AfDB launches $12 billion electrification plan
A $12 billion electrification program is being launched this week by the African Development Bank (AfDB) in an effort to achieve universal access to electricity in Africa by 2025.
The New Deal on Energy for Africa, which came out of the Energy Week conference held at the end of March in Côte d’Ivoire, will see the continent’s development bank investing $12 billion in power over the next five years, according to African Business.
Off-grid solar solutions will play a large role in the plan, with a goal to connect 75 million households and businesses through off-grid solar. PV solar kits cost about as much as kerosene, and are expected to bridge an important gap in energy solutions.
Nigeria oil turns to barges with pipelines damaged
Many oil and gas operators in Nigeria’s Niger Delta are turning to barges to transport crude, instead of using the country’s established pipeline system, according to the Financial Times.
The shift comes even as the Nigerian government is attempting to contain the militancy activities in the region. The militants have focused on destroying oil and gas infrastructure, and pipelines have been a consistent target.
Local companies like Seplat, Shoreline Energy and the country’s state-owned Nigerian National Petroelum Company are among those finding new routes to transport crude, on concerns that the Forcados pipeline will remain disrupted — 300,000 barrels per day still offline through Forcados.
Tanzania prepares draft agreement for LNG project
In an increasingly tight race between Mozambique and Tanzania to develop LNG and FLNG projects, Tanzania has taken a key step — the draft agreement between the government and the participating oil and gas companies is complete, according to the Tanzania Daily News.
The two countries, which began making massive gas discoveries in 2011, are each trying to develop LNG facilities, with Mozambique’s Coral FLNG project spearheaded by Eni expected to reach FID this year. Tanzania’s Lindi LNG plant, led by Statoil, has a completion target of 2021 or 2022.
The Ministry of Energy and Minerals Prof Sospeter Muhongo reportedly told the Daily News that the country’s LNG project will be “worthless” if Mozambique’s export projects come online first.
“Buyers would need to sign long-term contracts and this has a direct effect to the nation in case our competitor also targets the Asian market,” he said.
South Sudan power sector to get boost
The African Development Bank will give a supplementary loan of $14.7 million to the government of South Sudan in order to address power issues in the young country’s capital city of Juba, according to ESI Africa.
The project is aimed at rehabilitating and expanding the distribution network within the city and is expected to connect 20,000 new customers with the construction of construction of 145 kilometers of 33kV lines, 370 kilometers of 415/230 volt lines and 195 transformer stations.
Sub-Saharan Africa’s economy grows on rising commodity prices
After experiencing its lowest economic growth rate in two decades in 2016, Sub-Saharan Africa’s growth rate is expected to jump in 2017 as commodity prices increase and domestic policies continue to improve, according to data by the World Bank.
In its “Africa’s Pulse” report, the World Bank said growth was estimated at just 1.3 percent in 2016. The overall figure was especially brought down by poor economic performance in oil and gas giants Nigeria and Angola, and in South Africa.
Growth for 2017 is expected to rise to 2.6 percent as commodities stabilize, however, and is predicted to increase again to 3.5 percent for 2018.