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CEO of Energy Capital & Power, Devi Paulsen-Abbott, emphasises the pivotal role that partnerships play in unlocking economic prosperity and energy security across the African continent 

A number of dedicated events and exhibitions took place in Africa this year to spark discussions and inspiration to see the continent rise. Among them were top energy and infrastructure gatherings that confirmed Africa could become the world’s largest energy market. To truly understand the continent’s evolving energy sector, the African Energy Chamber’s State of African Energy 2024 Outlook delves into the realities and possibilities.

Africa’s energy sector is growing annually at a rate of 5%, driven by a population exceeding 1.2 bn people and featuring abundant natural resources, including oil, natural gas, coal, renewables, and uranium. While challenges exist, such as untapped resources and infrastructure limitations, the continent is on the verge of a transformative period.

Libya is one great example. Although its political instability has caused delays to some projects, the tide is changing. In February 2023, the National Oil Corporation launched its strategic plan to revitalise the country’s oil and gas sector. This will hopefully improve transparency and coordination across the sector and ECP’s Libya Energy & Economy Summit in January 2024 will provide a better understanding of the country’s energy and economic prospects.

It’s through forging strong partnerships, which are always encouraged at industry events, including with global counterparts, that countries in Africa can enhance infrastructure and spur economic opportunities. Africa’s significant population growth, urbanisation, and industrialisation present a unique landscape for sustainable development. The energy sector, therefore, holds the key to addressing economic disparities and propelling Africa towards substantial growth.

The challenge lies in identifying sustainable and affordable energy sources to meet demand. Africa requires solutions within a realistic energy mix to maximise all natural resources and combat energy poverty.

Global emissions must peak in the next 10-15 years if we are to have a good chance of holding global warming below 2 degrees Celsius, but we cannot and should not shoulder this burden. Even if Africa were to triple its production of natural gas from current levels, its contribution to global emissions would only rise by 0.67%. 

Even so, urgent transformation is needed in Africa’s electricity sector. Encouraging alternatives such as shale gas could contribute minimally to global emissions. The focus should be on diversifying, with gas complementing renewables to provide reliable electricity to the 600 mn people who go without access.

While making precise projections is challenging, the road transport and petrochemical sectors have been flagged as key drivers of demand over the next 18 months due to heightened global economic activity and a rise in consumption of energy-intensive goods. Future demand will be influenced by various factors outside these immediate markets, including global economic conditions, population growth rates, and shifts in fuel consumption trends (e.g., electric versus gasoline cars). Both sectors are highly energy-dependent, and potential limitations in the availability of affordable energy could impede production. The Organisation of the Petroleum Exporting Countries (OPEC) member nations, despite facing production compliance challenges, remain pivotal in driving output.

Collaboration, investment in local talent, and seizing opportunities presented by the continent’s young population and growing middle class are crucial for progress. Attention is needed in areas such as implementing smarter grids and advancing electric vehicles. Moreover, the strategic use of seaports for the storage and distribution of green hydrogen holds significant potential, positioning them as hubs for export.

The increasing trends of using drones for oil and gas inspections, using blockchain technology for oil and gas transactions, and the development of artificial intelligence for oil and gas forecasting are exciting possibilities that could benefit Africa’s oil and gas sector.  All of these innovations hold great potential to improve transparency, efficiency, and security.

Crucial to highlighting Africa’s cause, events and exhibitions play an important role in driving the necessary discussions towards progress while also serving as economic enablers. As a continent, we should modernise energy infrastructure and have the freedom to use all resources for energy reliability, emphasising the need for impactful investment.

It is essential to bring together the relevant players to make a significant impact on the continent.