Peter Uzoho
With about 82 million Nigerians living without access to electricity, a renowned oil and gas investor and Executive Chairman of AA Holdings Limited, Mr. Austin Avuru has stated that the gap presents about $10 billion to $16 billion business opportunity for local and international investors to reverse the trend.
Avuru stated this during an industry event in Lagos where he moderated a session that centered around Africa’s energy deficit, resources, refining capacity, energy security and energy transition and the need for swift actions by all relevant stakeholders across the industry.
“Coming down now specifically to Nigeria, 82 million of us have no access to electricity; 45 million of this 82 million cannot even afford it, even if we had it. This lack of access to electricity is giving rise to $10 to 16 billion opportunity to reverse this trend,” he stated.
Avuru noted that the lack of access to clean cooking represents a $2 billion to $3 billion investment opportunity, saying the country has to entrench clean cooking to Liquefied Petroleum Gas (LPG) and Compressed Natural Gas (CNG) among others in order to change the current trajectory.
On the continental level, however, he mentioned that over 640 million Africans have no access to energy and that worse still, even those who have access to energy could not afford even if it was available.
He explained that 600 million Africans do not have access to electricity, stressing that the sordid side of this is that it represents a $100 billion opportunity for service providers and entrepreneurs across Africa.
“It’s the same story for clean cooking. About 920 million Africans have no access to clean cooking. 680 million of this figure, even if they had it, cannot afford clean cooking. Again, to solve this problem represents $9 billion to $12 billion opportunity,” Avuru stated.
On gas reserve situation, the investor said Africa has a little under 600 trillion cubic feet (tcf) of gas but produces a little over 24 billion cubic feet per day (bcf/d) and consumes about 13.5 billion cubic feet per day (13.5bcf).
For oil, he said about 118 billion barrels of oil reserves is present across the entire Africa while the continent produces 6.1 million barrels daily (bpd) and consumes just 4 million barrels daily.
Continuing, Avuru pointed out that 23 countries in Africa have a refining capacity of 4.83 million barrels of oil per day, with five of this -Algeria, Egypt, Libya, South Africa and Nigeria accounting for 4 million barrels refining capacity.
He explained that the figure could easily have been 3 million barrels per day refining capacity if zero refining capacity was ascribed to Nigeria because of the country’s inability to refine crude for many years past.
He ascribed a refining capacity of about 1.1 million barrels to Nigeria owing to the Dangote Refinery’s 650,000 barrels per day in addition to the Nigeria National Petroleum Company Limited (NNPC) refineries that are undergoing rehabilitation and the modular refineries of about 10,000 barrels each.
“Now, the actual performance is rising from about 20,000 barrels a day and heading towards at least 600,000 barrels a day, and when NNPC finishes their job, we would be at 1.1 million barrels per day by the end of the year,” he added.
As part of Nigeria’s energy transition agenda, Avuru posited that the country needed to drive up production to 3 million barrels a day, emphasising that Nigeria ought to be at 3 million barrels a day peak production by 2032.
By then, he said Nigeria should start thinning down production beyond 2035 until it gets to the 2060 NetZero carbon promise it had made to the world.
“So, if we are no longer producing crude oil by 2060, it won’t be because any transition agenda was imposed on us, but because we designed a programme to exhaust our oil resources and optimise revenues over this period of time”, he argued.
On gas production, he said the country ought to ramp up both domestic and export gas to a total of 20bcf a day from the current 4.1bcf.
After achieving that, he said Nigeria could then pull that peak for about 20bcf a day from about 2025 to about 2055 before it starts thinning out gas production.
