Africa Must Adopt Systematic Approach Towards Stopping Investment In Fossil Fuel -Petroleum Minister

The minister of state for Petroleum Resources, Timipre Sylva, has again, reiterated the need for those clamouring for immediate cessation of financing fossil fuels by banks and other financial institutions to have a rethink of the implications of their actions on the energy needs of the larger society.

“I would like to mention that the campaigns demanding the immediate cessation of oil and gas production, as well as denunciatory reports from environmental NGOs blasting and slamming banks for continuing to finance fossil fuels have become fixtures of today’s life in the West and in Africa. However, I would like to remind them once again that fossil fuels are not going away soon.”

The minister spoke on Tuesday at the Society of Petroleum Engineers (“SPE”) Lagos Annual Technical Symposium and Exhibition with a theme: ‘‘Energy Transition In Africa: A Strategic Pathway To Net Zero,’’ also dropped the information that on Monday Africa achieved a milestone in its fight against energy poverty,“our Pan-African multilateral trade finance institution, the African Export-Import Bank (Afreximbank), has signed a Memorandum of Understanding (MoU) with the African Petroleum Producers Organization (APPO) for the creation of a Multi-Billion-Dollar African Energy Bank at the ongoing 8th African Petroleum Congress and exhibition in Luanda, Republic of Angola.

According to him, first off, Africa and the world need oil (and gas for that matter). The world needs oil and gas because it is what the world relies on for its most basic needs.

He said this would not change overnight. Therefore, African Governments and leaders should continue to invest in oil and gas, even as they work to help speed progress to a lower-carbon future.

“The International Energy Agency, for its part, has reversed its calls for lower oil and gas spending. In just a few months, the industry think tank group has changed its tune and is now urging oil and gas companies to increase production.”

He stated that multiple pathways to the energy transition should and must exist in order to ensure that no country is left behind in the process of achieving net-zero by 2060.

The minister said that as a continent, we need to be intentional and recognize the need to develop hydrocarbon resources in environmentally and socially responsible ways.

“And as alluded to by the African Union, we need to be realistic in choosing the energy transition pathways which address our unique requirements and circumstances. As well as enhancing policy, legislation and implementation approach across national, regional, and continental level, to enable a favorable environment for development.”

“ We need to develop bankable projects to scale up access to funding and investment. And adopt a mix of energy solutions to address the needs of each country including solutions to high tariffs and accessibility to sustainable energy options.

We need to promote energy efficiency which is necessary for energy transition and focus on building energy infrastructure and strengthening transmission corridors.”

He said he had repeatedly advocated at different fora, for the aforesaid to happen and to achieve desired results, Africa need to put modalities in place to establish an African Energy Bank (AEB) to address our own peculiar energy-related crisis and take Africans out of the doldrum of energy poverty in line with SDG No 7.

From the foregoing, I am happy to inform this gathering that yesterday Africa achieved a milestone in our fight against energy poverty, our Pan-African multilateral trade finance institution, the African Export-Import Bank (Afreximbank), has signed a Memorandum of Understanding (MoU) with the African Petroleum Producers Organization (APPO) for the creation of a Multi-Billion-Dollar African Energy Bank at the ongoing 8th African Petroleum Congress and exhibition in Luanda, Republic of Angola.

The energy bank will provide vital financing for new and existing oil and gas projects, as well as energy advancements across the whole value chain, with the goal of increasing private sector investment in African oil and gas projects. The bank arrives at a critical time for Africa’s energy sector, following major oil company divestment and a shift in global investment trends.

As I conclude, have in mind that the new realities for our industry, offers both challenges and opportunities. In the end, if challenges are to be met and opportunities seized, more cooperation is required amongst African leaders and our allies to develop a more detailed and just energy transition and long-term development of the oil and gas industry.

Let me also say this, individual governments cannot do it all alone, we need to collaborate across broad-spectrum and dimensions, i.e., government, industry, academia and, especially, regional institutions and professional associations like SPE and continent think tanks and associations like the African Energy Chambers (AEC), African Petroleum Producers’ Organization (APPO), the African Union (AU), the African Energy Commission (AFREC) etc to make this happen.

He assured of that Nigeria is ready, willing, and able to play its part in that regard and she is counting on other African countries to do the same.