•May float continental bank to fund oil projects
By Emmanuel Addeh
Some African oil-producing nations yesterday opposed what they described as the global conspiracy to shut down the economies of the continent’s resource-dependent countries.
They urged members to take urgent action against the threat to their combined 100 billion barrels oil reserves.
Some of the 15 African nations that are largely dependent on proceeds from oil and gas, called for massive investment in research and development in preparations against the impending storm occasioned by the gradual withdrawal of external funding for fossils fuels as well as the plan by Europe and America to stop the production of machinery used in the oil and gas industry.
The African oil producers also mulled the establishment of a continental bank to fund oil projects.
Minister of State for Petroleum, Mr. Timipre Sylva, who threw his support for closer ties among African nations said the move would drive regional collaboration on local content matters, institutionalise a peer review mechanism among oil-producing countries on local content and domestication of sustainable growth of the continent hydrocarbons.
Sylva, along with the Executive Secretary, Nigerian Content Development Monitoring Board (NCDMB), Mr. Simbi Wabote; Secretary-General, African Petroleum Producers’ Organisation (APPO), Dr. Omar Ibrahim, and representatives from Angola, Niger, Cameroon, Gabon, Egypt, Algeria, among others, spoke yesterday during the first African local content roundtable in Yenagoa, Bayelsa State.
There is currently a global movement to halt the production of hydrocarbons, especially oil and gas, as multinational oil companies, powerful nations in Europe and the Americas, the international banking system as well as international civil society organisations canvassed defunding oil-related investments.
Sylva stated that it was time for Africa to look inward, adding that for instance, through the implementation of local content, Nigeria has achieved growth in the value chain in-country from less than 5 per cent in 2010 to 35 per cent in 2021 and setting a target to achieve 70 per cent by 2027.
According to him, Nigeria must lead the way in amplifying the benefits of local content to fellow African countries, which is the essence of the African local content roundtable.
The minister stated that Africa has not benefitted fully from its fossil fuels because it has failed to domesticate operations within the continent.
He said: “We all know that the gains of hydrocarbon production in Africa have not translated into the desired economic growth in our continent. While over 15 African nations are producing and exporting crude oil, a sad reality is that our people have not benefited maximally from this natural resource.
“This is either because we have not managed the proceeds optimally or we failed to domesticate the core of operations of the industry.
“We must therefore use the opportunity of this roundtable to initiate conversations around local content, share success stories, challenges and come up with policies that will deepen local participation and domiciliation in our respective countries.”
According to him, one of the pathways towards this collaboration is the African Continental Free Trade Area, to facilitate free movement of goods, services and investments within the 54 member states, creating access to 1.2 billion customers with a cumulative Gross Domestic Product (GDP) of over $3.4 trillion.
He stated that the federal government has begun the funding of strategic energy facilities in-country, including the 10,000 tonnes per day methanol plant and the 500 million standard cubic feet of gas processing plant in Brass, Bayelsa State and the ammonia fertiliser plant in Akwa Ibom.
In his intervention, the NCDMB executive secretary said Africa must not always pander to the West, and stressed the need to set up a continental bank to fund oil and gas projects, since foreign banks have started withdrawing their investments from oil and gas.
He called for investment in R&D, saying that only South Africa makes the list of countries in the continent in research with 0.02 per cent spending of GDP.
“We were getting used to firewood, they discovered coal and they told us firewood is a very dangerous source of energy, so all of us decided to drop firewood. We started coal in Enugu and we’re getting used to it, they said they discovered hydrocarbons and they told us it is the dirtiest fuel on earth.
“We abandoned coal factories and started pursuing hydrocarbons. When the recent discussion started, it was initially on energy transition, but today it is renewables. The discussion has started as to how bad hydrocarbons are and how we have contributed to the ozone layer, to carbon emission.
They have hired engineers who are telling us how bad hydrocarbons are. Very soon, one professor will publish a paper telling us how gas causes cancer and we will all run away from the utilisation of gas.
We must invest in R&D because by the time they start, all the companies manufacturing all the tools, Halliburton and Schlumberger and the rest will stop and then you begin to look for renewables which they will sell to us,” he said.
Also, the APPO secretary-general said even the international oil companies that built their fortunes through fossil fuels are now redirecting their investments away from oil and gas.
He added: “Financial institutions and IOCs, even educational research institutions, that are centres of innovation for the industry are closing their petroleum faculties in order to be seen to be in conformity with the global paradigm shift.
“With over 100 billion barrels of oil still in our ground, most economies are still heavily dependent on oil revenue. Is Africa ready to forgo the production of those 100 billion barrels and classify them as wasted assets?’’
