Africa to replace Russian gas supplies to Europe?


African countries are amongst those intending to increase their exports of gas to the European Union, after the EU dedicated to minimize its dependence on Russian supplies following the invasion of Ukraine.

Russia's suspension of shipments to Poland and Bulgaria over their refusal to pay in roubles, the Russian currency, was a stark tip of the threat dealing with the Eurozone. Russia has the largest gas reserves in the world and is the biggest exporter, representing around 40% of Europe's imports.

The EU wants to cut supplies by two-thirds by the end of the year and end up being independent of all its nonrenewable fuel sources by 2030.

Nevertheless, energy economic expert Carole Nakhle states that with the combined exports of Africa's big players in the industry - Algeria, Egypt and Nigeria - amounting to less than half of what Russia supplies to Europe, they are "unlikely at the moment to make up for any losses in Russian supplies".

" The excellent news there will be greater interest in countries that currently have the resources to change Russian gas and Africa remains in an excellent position. We're going to see more financial investment," she says.

Nevertheless, this will take time because if different logistical problems in the continent's major exporters.

Algeria is well placed to benefit from the EU's shift in energy policy. The North African country is the region's greatest natural gas exporter and currently delights in well developed gas connection facilities with Europe.Last month Italian Prime Minister Mario Draghi signed a new gas supply deal with Algeria to increase gas imports by around 40%.

It was Italy's very first significant offer to discover alternative supplies following Russia's intrusion of Ukraine.

Nevertheless, there are concerns over Algeria's capability to improve capability due to rising domestic intake, underinvestment in production and political instability, states Uwa Osadieye, the senior vice-president of Equity Research at FBNQuest Merchant Bank.

He points out that the amount of gas exported from Algeria to Europe has fallen greatly recently because of a conflict with Morocco, leading to the closure of a vital pipeline to Spain, from 17 billion cubic feet a year to around nine billion.

Pier Paolo Raimondi, an energy research study fellow at Rome's Instituto Affari Internatzionali, echoes these concerns.

" The agreement will permit them to exploit the offered pipeline transport capability and it could gradually provide increasing volumes of as much as nine billion cubic metres annually in 2023 and 2024. [But] we don't know how fast Algeria can ramp up this production."

Regardless of the reservations, the offer has been hailed as a strong first step for Italy, which is the second-largest buyer of Russian gas in Europe.

Italian ministers likewise took a trip to Angola and Congo-Brazzaville, where they concurred brand-new gas offers and Italy is eyeing opportunities in Mozambique in a bid to end its reliance on Russia by mid-2023.

On The Other Hand, West African liquified natural gas producer, Nigeria LNG, has actually been flooded with request for gas from European nations since the start of the conflict in Ukraine.

Nigeria is under pressure to increase gas production

At present, Spain, Portugal and France are the three essential destination markets for Nigeria LNG's product and the business is just able to honour its existing agreements with purchasers, according to a source who wants to remain anonymous.

" There is a chance to increase production. Today Nigeria LNG is simply 72% plant-mobilised, which means there's still capability of 28% to use, provided they're able to get the gas, which's where the biggest difficulty is right now," the source says.

He points out myriad concerns obstructing the company's capability to step up production, consisting of declining gas wells and a lack of financing for upstream activities.

" They're things that can be fixed in the short-term - in between 6 to 18 months."

According to Andy Odeh, Nigeria LNG's General Manager of External Relations and Sustainable Development, discussions are ongoing with natural gas suppliers to solves these concerns and he hopes to increase LNG production levels "from the end of this year onwards," he says.

A brand-new Nigeria LNG gas project, Train 7, will increase production capacity by 35% from the present 22 million tonnes per annum by 2025.

However, agreements with purchasers, mostly in Europe, are currently in place. Nigeria LNG is likewise performing feasibility research studies for an extra project, Train 8, to boost supplies further.

The West African state is also a key player in the stalled Trans Saharan Pipeline project - a 4,400 km (2,735 mile) natural gas pipeline that would range from Nigeria, through Niger to Algeria.

It would link to existing pipeline infrastructure in Algeria, connecting West African nations to Europe.

The project was mooted in the 1970s, but has actually been bedevilled by security threats, ecological issues and an absence of funding.

Nevertheless, Kayode Thomas, the head of Bell Oil & Gas, states that another project - the Nigeria-Morocco gas pipeline, which will link facilities in West Africa to Morocco in order to reach Europe - is acquiring traction.

"We're still not sure whether this will cannibalise the Trans Saharan pipeline or run along with it," he says.

The project, estimated to cost $25bn ($20bn) and connecting 13 West and North African countries, will be completed in stages over 25 years.

Ms Nakhle says the shift to sourcing gas from Africa could likewise benefit countries such as Tanzania and Mozambique, although a substantial project there run by French giant Total is presently on hold following a significant attack by Islamist militants based in the location.

"There is excellent prospective in Africa, but I would state that it's got to be very limited in the short-term because gas projects take time to materialise," she states.

But in the medium- and long-lasting, "you will see higher financial investment to increase the capability to bring more gas out of the ground and bring them to Europe".

My name is Nyasha Ernest Matanda your 🅰️ℹ️ Officer
©️ 2022 Nyasha Nation All Rights Reserved Premium By 123Kurd Themes