The Group Chief Executive Officer of the Nigerian National Petroleum Company Ltd, Mallam Mele Kyari has called on African countries to take advantage of the implementation of the African Continental Free Trade Agreement to diversify their energy sources into a sustainable, low-carbon energy mix.
Kyari said this on Tuesday at the ongoing Offshore Technology Conference holding in Houston Texas, United States.
The event is being attended by captains of the oil and gas industry as well as regulators in the sector.
The theme for discussion at the conference is, ” Energy Transition in Africa: The Journey, Challenges and the Way Forward.”
The AfCFTA is one of the flagship projects of Agenda 2063 and it is a high-ambition trade agreement, with a comprehensive scope that includes critical areas of Africa’s economy, such as digital trade and investment protection, amongst other areas.
It is the world’s largest free trade area bringing together the 55 countries of the African Union (AU) and eight Regional Economic Communities (RECs).
The overall mandate of the AfCFTA is to create a single continental market with a population of about 1.3 billion people and a combined Gross Domestic Product of approximately $3.4trn.
By eliminating barriers to trade in Africa, the objective of the AfCFTA is to significantly boost intra-Africa trade, particularly trade in value-added production and trade across all sectors of Africa’s economy.
Kyari who was represented at the event by the Executive Vice President, Upstream, Adokiye Tombomieye, described the theme as apt because the journey towards energy transition in Africa has been challenging.
He expressed worry that despite being home to some of the world’s largest oil and gas reserves, the continent of Africa has struggled to leverage these resources to drive sustainable development fully.
Furthermore, he pointed out that the lack of access to reliable and affordable energy has significantly impeded economic growth and development, particularly in rural areas.
The NNPC Boss said while the African oil and gas industry has contributed to the continent’s economic growth for several decades, there is a need to ensure its sustainability.
In order to move towards a more sustainable future, Kyari told the gathering that the African continent must acknowledge that the industry is transforming rapidly.
He said, “As we gather here today, it is essential to acknowledge that Africa is at the forefront of the global energy transition. The journey towards a sustainable, low-carbon energy future presents challenges and opportunities for the continent.
“The energy transition is driving changes in the global energy mix, and it presents significant challenges for Africa (financing, infrastructure, policy/regulatory frameworks, skills, and capacity).
We must adopt a strategic approach to address them to ensure that we remain competitive, sustainable and relevant in the years to come.
“Despite these challenges, Africa has several opportunities for energy access, economic growth, environmental sustainability, and regional integration in the energy transition.
“Some levels of progress have been attained from exploiting several opportunities, resulting in a growing interest in renewable energy sources such as solar, wind, and hydropower, as well as an increasing focus on energy efficiency and conservation. Governments, private sector players, and civil society organizations have all played essential roles in driving this change.”
In the next 20 years, the NNPC Boss stated that energy demand in Africa has been projected to increase by 30 percent to 35 percent to support the projected increase in population and industrialization.
This, he noted, presents an enormous opportunity for countries to form partnerships across the continent and build a sustainable future.
He added, “We must also discuss the options that abound in energy transition with the African Continental Free Trade Agreement (AfCFTA) to balance economic growth with environmental sustainability.
“One of the key factors shaping this transition is the African Continental Free Trade Agreement (AfCFTA), which aims to create a single market for goods and services, promote cross-border trade and investment, and enhance economic integration across the continent. As an industry, we must take advantage of the opportunities presented by this landmark agreement and work collaboratively to address the challenges that may arise.
“Several reforms must be pursued rigorously to diversify our energy mix, Enhance local content and capacity building, Embrace technology and innovation, and strengthen partnerships and collaboration.”
Kyari stated further that partnerships are required as more African countries continue to make hydrocarbon discoveries.
“We should collaborate and share knowledge and help each other in critical areas, including technology, exploration and production, research and development, technical expertise and human capacity development to spread the wealth within the continent.
“At NNPC Limited, we understand the importance of partnerships in achieving a sustainable energy industry in Africa.
“We have worked closely with countries, companies and other stakeholders to develop innovative solutions to meet the continent’s energy needs, as demonstrated in the progress of the 5,600Km Nigeria Morocco Gas Pipeline to supply gas to Europe through Morocco and (13) ECOWAS member Countries,” he added.
Speaking further, he told the audience that the energy transition in Africa presents a unique set of challenges and opportunities.
To deliver the future of offshore energy, the GCEO said countries in Africa must work together to prioritize investments in renewable energy infrastructure, research and development, and capacity building.
“Only through collaboration can we achieve energy security and transition to cleaner energy, unlocking the potential of Africa’s abundant renewable energy resources and ensuring a sustainable and prosperous future for all.
“NNPC Limited is fully committed to partnering with all players in the energy industry to drive Africa’s energy sector towards sustainability and growth to guarantee our Energy for Today and Energy for Tomorrow,” he concluded.
