NJ Ayuk - Afrikan Heroes

Shipping and Logistics Represent Valuable Opportunities for African Companies, Entrepreneurs in the Energy Sector in 2022

December 24, 2021

By NJ Ayuk

Like many other national oil companies (NOCs) in Africa, Ghana National Petroleum Corp. (GNPC) has mostly served as a minority partner in upstream projects. That is, it has represented the Ghanaian government’s interests in contracts with foreign investors and collected a share of the money earned from those contracts, but it hasn’t led the way in exploration and development activities.

Officials in Accra are hoping to change that. In late October, Dr. Kofi Karduah Sarpong, the CEO of GNPC, explained that his company was working to expand its stakes in two major offshore blocks because it wanted to gain the ability to develop oil and gas reserves on its own.

NJ Ayuk, Executive Chairman of the African Energy Chamber, CEO of pan-African corporate law conglomerate Centurion Law Group

“We have to build the capacity of GNPC to become an operator,” he recently told journalists. “If we do that, 15 years from now, we should mature and stand alone.”

This is an ambitious goal, and we at the African Energy Chamber salute GNPC for its ambition. We wish Dr. Sarpong success and look forward to the day when GNPC and other African upstream operators are reaping the lion’s share of the revenues generated by upstream oil and gas operations.

But we also agree with Dr. Sarpong that this is a goal that can’t be achieved quickly. It’s a long-term prospect and a steep uphill climb that will require a great deal of internal investment and capacity-building.

Nor is it a target that every African state should try to hit. Some countries lack the resource base to justify the establishment of a NOC with the capabilities GNPC is hoping to develop. Some countries may choose to follow a different model for the management of hydrocarbon reserves — something more akin to the strategy used by Guyana, the South American state that has opted to let international oil companies (IOCs) assume all exploration and development costs rather than take an equity stake in its offshore blocks.

However, there are still opportunities for practically every state in Africa to support the oil and gas business in one way or another. The African Energy Chamber has been striving to drive home the message that oilfield service providers (OSPs) have an important role to play. Oilfield services aren’t limited to specialized, technology-intensive services such as drilling or seismic surveys carried out under direct contracts but also include non-specialized, labor-intensive services such as catering and cleaning carried out under subcontracts. That’s why we dedicated an entire section of our 2022 Africa Energy Outlook to demand and prospects for OSPs in the near term and through the energy transition. We want African countries— and African companies — to explore these opportunities!

Opportunities in Shipping and Logistics

One particular area where African companies can stand out is in shipping and logistics.

On the one hand, the demand for these services is both tremendous and inescapable. Shipping and logistics operators serve as crucial links in the oil and gas supply chain, in that they are responsible for moving goods, parts, equipment, and workers from the places where they can be picked up to the places where they are needed.

Some of these operators have found that oil and gas development can serve as the foundation of a successful business. Universal Africa Lines Alliance (UAL Alliance), for example, began delivering cargo to West Africa in 1973 and has now established itself as a stable provider of professional cargo handling services, focusing on break-bulk and project cargoes for the oil and gas industry. UAL Alliance moves cargo between the U.S. Gulf of Mexico and Europe to West Africa and vice versa and also offers intra-African service on the west coast of Africa.

UAL Alliance is an international firm, but it is also firmly rooted in Africa, as it serves ports in Ghana, Nigeria, Gabon, Equatorial Guinea, and Angola. What’s more, it has also constructed the K5 Freeport & Oil Centre, its own logistics and supply base at the port of Malabo in Equatorial Guinea — and in doing so, it has helped to create additional jobs for the contractors and subcontractors that helped build the base, as well as the companies that now use the base. It has also helped sustain the African companies that have acted as its shipping agents, such as Akon-Donluis in Equatorial Guinea, Action Rapide Transit (ART) in Gabon, and Logistics Support Services (Pty) Ltd in Namibia.

Oil and gas exploration and development off the west coast of Africa has already kept UAL Alliance busy for nearly 40 years, and the company is looking to grow over the next few years. It has said it hopes eventually to set up shop in East Africa — presumably, so that it can start offering the same kind of services and support to emerging hydrocarbon producers such as Mozambique, Tanzania, and Uganda.

As it does, it will not only be exploring new opportunities in the region. It will also be creating new opportunities — new opportunities for local shipping agents, new opportunities for the local service providers that will build, repair, and maintain its delivery facilities and offices, and so on.

And UAL Alliance is far from the only indigenous shipping and logistics firm in Africa seeing success in the oil and gas sector. Many others were heavily represented at African Energy Week in Cape Town and some signed deals with international oil companies. A few additional examples include Nairobi-based OML Africa Logistics and Luba Freeport, which provides oilfield equipment handling and transportation in Eastern Africa; Seabird Ghana, maritime logistics and oil and gas services provider for west Africa; and Petromarine Nigeria Limited, a marine logistics services provider for Nigeria’s oil and gas industry.

Building the Right Foundation

We’re also seeing African states take proactive steps to support successful oil and gas maritime logistics operations. Look at Senegal, which is constructing a high-tech, operationally efficient “superport” near Ndayane, 50 kilometers southeast of Dakar. The project, dubbed the “Port of the Future,” is part of the country’s energy sector expansion, launched after the discovery of approximately 450 billion cubic meters of natural gas. What’s more, Senegal is taking steps to make sure that everyday people benefit from its growing maritime infrastructure by building local capacity. Macky Sall’s Plan Senegal Emergent is specifically designed to, among other things, create opportunities for local service companies. Senegal also is fostering capacity building in maritime logistics through its National Petroleum Institute and the Dakar Business School. Aguibou Ba is the Executive Director of the Institut National du Pétrole et du Gaz (INPG), has also implemented related programs to fast track capacity in this area through the state institute.

Another positive example is Mozambique, which is developing a national strategy for a blue economy that addresses, in addition to fishing and aquaculture, the country’s extractives and hydrocarbon sectors. The plan will also include a regional plan for maritime security. With a plan in place, hopefully followed by policies that support local entrepreneurs and capacity building, Mozambique OSPs will be in a strong position for success in maritime logistics.

The African Energy Chamber believes there are numerous opportunities available for African companies and entrepreneurs who are ready to explore the shipping and logistics sector. Now is the time to seize them.

NJ Ayuk, Chairman, African Energy Chamber (www.EnergyChamber.org)

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry

African Governments Must Act to Protect Their Countries’ Oil and Gas Industries after COP26

November 3, 2021

By NJ Ayuk

As we approach the end of 2021 and COP26, the African oil and gas industry is in a precarious position. As if the economic devastation of the pandemic weren’t enough, we’re also faced with increasing pressure to reduce our production of fossil fuels and move toward renewables. Many of the majors are beginning to divest from African oil and gas projects because of the issues emerging around the energy transition.

But oil and gas remain critically important to meet Africa’s economic and energy needs, and that need is greater than ever. Our countries rely on oil production for revenue and jobs, and natural gas is still an important means of reducing energy poverty. It’s also essential to build much-needed infrastructure so we can industrialize and diversify our economies.

We face challenges on all sides. Our economic survival depends on a thriving, strategically managed oil and gas industry, and African governments must act now to protect our industry and our future.

The Clock is Ticking

The African Energy Chamber recently released our 2022 Outlook outlining the industry forecast for next year and beyond. While the report indicates signs of recovery, it also signals the need for African governments to step up their efforts to ensure the health and longevity of our industry — and the need for even more immediate and decisive action in the post-pandemic environment. If our oil and gas industry is to deliver the benefits of a just energy transition to the African people, our governments must move quickly.

The AEC report brings new urgency to the issues that have plagued our industry for decades. I’ve written at length about the need to reform our fiscal policies and regulatory structures. This includes better deal-making, retooling ineffective regulations, and putting an end to corruption, human rights abuses, and resource nationalism. And in the post-pandemic environment, it’s even more critical that we adjust our deal structuring to account for the higher perceived risk of doing business in Africa.

Signs of Recovery

There’s still time for African governments to take the lead and reshape our future. The 2022 Outlook highlights some positive indicators for the period ahead. But the window of opportunity is small, and we must take advantage of every upward trend.

2021 saw crude prices begin to recover and stabilize well above the historic lows of 2020. Several major projects have been sanctioned, including the Eni-operated Cuica field in Angola, the Total Energies-operated Tilenga project onshore Uganda, the Chevron-operated Sanha lean gas development, and the CNOOC-operated Kingfisher South project. That activity helped maintain African capital expenditures at an estimated USD33 billion, slightly above the year-end 2020 estimates.

Rig demand, another growth indicator, is expected to rebound significantly beginning in 2022 as higher oil price expectation helps to revive exploration activity and drilling programs for projects currently in development get underway. Based on the oil price outlook presented in the report, the combined potential of these new projects and further exploration activity will help propel demand back toward pre-pandemic levels.

Gas-to-power remains a huge — and still growing — area of opportunity. Gas supply and demand are forecast to recover after the sharp 2020 decline, and LNG demand is expected to grow at a healthy CAGR of 5%.

All these point to the start of a new cycle of recovery and growth. That said, however, the pandemic caused unprecedented market turmoil, and its impact on our industry will have far-reaching effects for years to come. We have a long recovery ahead and a host of issues to contend with.

A New Set of Challenges

The AEC report estimates that COVID-19 will have cost Africa nearly USD150 billion in exploration and development expenditure between 2020 and 2025. Clearly, the need for action is urgent.

One of the biggest challenges facing our industry is the decline in capital spending. Capital expenditure was already trending downward as we entered 2020. Even before the pandemic, new project activity was slowing because of general cost compression and the difficulty of getting new projects sanctioned. With COVID deferring investment decisions on many projects, capital expenditure is expected to remain low through 2025.

Upstream exploration also took a big hit. 2020-2021 discoveries were the lowest in a decade. The upstream outlook for 2022 is more encouraging, with 13 new high-impact wells anticipated. But with crude prices not expected to rebound until 2023, projects will continue to be deferred or deemed commercially unviable, limiting our growth potential. The majors’ upstream investments are expected to decline 2022-2025 by about USD34 billion compared to year-end 2020 estimates.

It’s Time to Push Harder

While the AEC report forecasts some modest improvement for 2022, the message is clear: African governments must move swiftly to ensure that the arc of our energy transition bends in the right direction. With access to electricity at only 56% of the African continent — and at less than 40% in more than a dozen countries — our top priority remains achieving universal access to energy. This is the foundation of economic empowerment for all Africans and our larger mission.

Specifically, as NOCs and IOCs struggle to regain their post-pandemic footing, we need to prioritize oil and gas development by optimizing the conditions for investment and partnership. We can’t fall victim to the foot-dragging and red tape that has hindered our progress in the past. We must continue our drive for amended policies, restructured regulatory frameworks, and investor initiatives that improve the conditions for doing business in Africa.

What’s Our Game Plan?

Let’s look at the actions African governments can and should take to protect our oil and gas industry.

For one thing, we should be making better use of technology. We’re living in the most technologically advanced era in human history, but the African oil and gas industry has failed to utilize digital solutions effectively. We should be using 21st-century solutions to solve 21st-century problems.

A good place to start our digital transformation is with licensing rounds. After a 2019 uptick in licensing activity, several rounds in 2020-2021 were delayed or canceled altogether in the wake of the pandemic. I’ve advocated for revamping licensing rounds for some time now, and the need for reform is even more pressing in the post-pandemic environment. The glacial pace of our bureaucratic, paper-laden process continues to hold us back. We can generate more exploration faster with a more streamlined system, but that demands the ability to process data much more quickly.

Yes, technology requires an investment. Most worthwhile ventures do. But if that investment rewards us with more exploration and development, it’s well worth making. We’re already late to the party, and our failure to adopt digital solutions has hurt our progress. We can’t afford to wait any longer.

We should also make sure we’re doing everything we can to ensure contingent investment. The AEC report projects capital spending to stay relatively flat in 2022–2023, with any 2024-2025 growth expected to come from contingent expenditure. Rig demand is one growth indicator, as I’ve said, and it’s often tied to contingent resources and, as a result, sensitive to investment decisions expected in the next few years. In Angola alone, for example, about 45% of rig demand is related to contingent resources. Regulatory authorities should expedite projects to provide longer-term visibility on future production volumes so we can realize that revenue, which the AEC estimates at up to $40 billion.

Reducing project breakevens is another important way we can sustain and generate development. In the wake of COVID, many operators delayed projects with high breakeven crude prices. When oil prices crashed to below $35 per barrel, it had a drastic impact on economic forecasts since many projects were planned assuming a price of $55-$60 per barrel.

Subsea tiebacks are one of the best ways to achieve more competitive project breakevens. Connecting new discoveries to existing production centers is an obvious development solution. The AEC reports that subsea tiebacks will be the largest category of investment through 2025. We should prioritize the use of subsea tiebacks to reduce breakevens and protect more revenue.

Gas-to-power continues to be a huge and growing opportunity for Africa. The 2022 Outlook reports that LNG will dominate our industry well into 2025. But we have to do a better job of incentivizing that activity. As the majors continue to shift away from crude oil and toward monetizing gas, we need to incentivize gas projects as proactively as we do oil exploration and production. Specifically, this means revising our PSCs to provide more favorable terms to investors. Most African countries currently have oil-based regulations or production contracts that don’t also include provisions for gas. Clear regulations are essential for us to achieve widespread distribution of natural gas and construction of gas-to-power facilities.

None of this is optional. All the measures I’ve outlined are crucial to minimize our losses and optimize the conditions for growth as we move into 2022. It’s not a question of if, but of how quickly we can put these reforms in place.

The Future is Now, and It’s Up to Us

Africa’s future depends on sustaining the longevity of our oil and gas industry. As we emerge from the pandemic, the need for action is even more urgent. African governments must take strategic, decisive, and immediate steps to protect and reform our industry.

It’s our responsibility to ensure that our energy transition benefits Africa and our people, and the time to act is now.

NJ Ayuk is the Chairman, African Energy Chamber

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry

Divorce In View As Africa Oil Week Picks Non-African Venue

June 8, 2021

By Ajong Mbapndah L

The discontent from the African Energy Chamber on the AOW decision has resonated with many Africans who are using diverse platforms to call for the prioritization of African venues. Initially scheduled for 1-5 November in Cape Town, South Africa, there is growing furor across the continent following the relocation of the 2021 edition of the Africa Oil Week (AOW) to Dubai in the United Arab Emirates from 8-11 November 2021.

“Delivering the event to the high standard to which our audience is accustomed and ensuring the safety and wellbeing of our attendees has always been our top priority. We believe that hosting the 2021 edition in Dubai will enable us to ensure that the event experience is both safe and premium for our customers,” the AOW said in a statement posted on their website recently.

Reactions did not take long to come with the African Energy Chamber led by NJ Ayuk leading the charge in calling for a stronger commitment to conferences of African nature being held on African terrain.

Mothballing a conference in South Africa, an African nation that has handled the Covid-19 pandemic remarkably well, is a clear sign of opportunism and detachment from the pledge to support African venues and our continent, the Chamber lashed out.

“While Dubai is a fabulous venue in its own right, we do believe that events of African nature should show strong commitment to African communities, cities and the local workforce. An event of the magnitude of Africa Oil Week is a big local employer. Reneging on its long-standing partner, the African people and the continent, is a truly unfortunate sign of disinterest in African values of trust, loyalty and companionship, and is in fact very unscrupulous in nature,” said NJ Ayuk, Executive Chair of the African Energy Chamber.

“Keeping to Covid-19 travel restrictions and how they have particularly placed a strenuous burden on the conferencing industry, there are smart ways to hold hybrid conferences of both online and offline nature. Further, vaccination rates are increasing rapidly across the Northern hemisphere, which would allow business travelers to visit South Africa in a safe manner by November,” Ayuk added.

The discontent from the African Energy Chamber on the AOW decision has resonated with many Africans who are using diverse platforms to call for the prioritization of African venues for African events.

The event’s move from Cape Town to Dubai was wrong, short-term in its thinking, and sends a negative message about Africa, says Florival Mucave, President of Mozambican Oil and Gas Chamber (CPGM).

“The move underestimates our preparedness to host events that define our future economic and energy sector success. Imagine the Africa Cup of Nations football tournament being hosted in Dubai because one company says Africa is not the right place anymore because of the COVID-19 pandemic,” Mucave said in condemnation of the relocation.

The excuses and final decision to move the event are both unacceptable and wrong, and sends a message that when things are hard because of COVID-19, Africa should be abandoned for other locations irrespective of the loyalty and the sponsorship Africa has shown for more than two decades, Mucave charged.

“As a former Patron of the African Institute of Petroleum, I concur that a move of AOW from an African location to any other continent is not just disrespectful to Africans whose resources are being talked about but considerably delusional,” says Robin Vela, Chairman, Lonsa Group Limited, Mauritius.

“I thought I was the only one who saw something very wrong with this decision. Africa as a continent is the least affected by COVID in the whole world, we have lesser death rates, came up with several initiatives and innovations to tackle the scourge. In my opinion, Africa handled the pandemic even better than the rest of the world, so why should the continent be counted out on grounds of the global pandemic,?” Margaret Nongo -Okojokwu , a 2017 Mandela Washington Fellow and social entrepreneur from Nigeria questions.

To the CEO of Turaco Aviation Group Abdul Bigirumwami from Rwanda, African events should stay in Africa, Rwanda has handled the COVID-19 pandemic well and can support such events.

For Senior Tax and Legal Counsel from Senegal Abdoulaye DIA, “we cannot make Africa without Africans and out of Africa.”

“This is so sad for our struggling South African Event/Expo Industry. It’s all about money and buggers everyone else. “Africa” Oil Week… Dubai has never been or will ever be in Africa. Change the name of the event,” Simon Aubrey Onsite, Project / Site Manager for Overlay of Exhibitions / Sport Events opines.

Given the relentless attack that the oil and gas industry is facing, there is no better time for the oil and gas industry to stand with Africa but now, says the African Energy Chamber as it pledges to continue pushing for discussions on energy transition, fiscal responsibility, free markets, upstream, midstream, downstream, renewables and petrochemicals in Africa.

Beyond the criticisms on moving the AOC to Dubai, the controversial decision has prompted the Africa Energy Chamber to start exploring other avenues on what is perceived as injustice.

“As a first step, the Chamber will encourage, advocate and provide support for an energy event in October or November this year with African ministries, entrepreneurs, NOC’s, IOC’s, Civil society and possibly four African heads of States. The Chamber will continue to be the voice of the sector and work towards building bridges that brings together governments and companies in the African energy industry to find a common ground,” a recent statement read.

Ajong Mbapndah L writes from Washington D.C. USA

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry

Environmentalists Wrong Approach to East Africa Crude Oil Pipeline (EACOP) in Uganda and Tanzania

April 19, 2021

By NJ Ayuk

If someone were to put me on the spot and ask me to name an environmentalist group, I’d probably blurt out the first thing that comes to mind, Greenpeace. There are obvious reasons for this: Greenpeace has been around for more than 50 years, and it has done a masterful job of bringing environmental concerns to the world’s attention and keeping them there. The group has a strong track record when it comes to advocacy and awareness, and it has a global reach. It’s truly one of the most visible non-governmental organizations (NGOs) in the world.

And that’s why I see it as significant that Greenpeace’s African division has come out swinging for a major new oil pipeline slated for construction in Uganda and Tanzania. Let me explain what I mean.

What’s at Stake

On April 14, Greenpeace issued a statement expressing dismay about the signing of a new agreement on the East Africa Crude Oil Pipeline (EACOP), a midstream project involving Uganda, Tanzania, the French major Total, and China National Offshore Oil Corp. (CNOOC).

The agreement serves to remove one of the final obstacles to the building of the pipeline, which will transport crude oil from fields in western Uganda, near Lake Albert, to a port on the Tanzanian coast. As such, it also clears the way for Total and CNOOC to set a concrete schedule for development of the upstream assets that will fill the line — and for investors to start pumping more than $5 billion into East Africa.

Greenpeace believes that Uganda and Tanzania ought to turn down this foreign direct investment (FDI). They explained their position by pointing out that EACOP poses environmental risks – which are hardly surprising, given their record on all seven continents. But they also argued that there were hard economic and political reasons to ditch the pipeline. Specifically, Greenpeace asserted that the building of the pipeline would have the following negative effects:

It would stymie the development of renewable energy and the creation of so-called green jobs.

It would benefit large multi-national corporations and not local communities.

It would involve Uganda and Tanzania in “neo-colonial projects.”

These are strong words to use, and they deserve a strong — and serious — response from Africans.

I have one: Greenpeace and Western Anti African energy groups, you’re wrong.

Oil vs. Renewables: “Both-And,” Not “Either-Or”

First, you’re wrong to predict that renewables will be crowded out if an oil pipeline is built. That’s not true. EACOP is an export-oriented project, in that it’s designed to pump 216,000 barrels per day (bpd) of oil, or about 83% of peak output from Uganda’s Kingfisher and Tilenga fields, to the Tanzanian coast so that it can be loaded onto tankers and sold on the world market. In other words, most of Uganda’s oil won’t be going to refineries so that it can be processed into fuel for local power plants.

As a result, EACOP won’t help Uganda or Tanzania overcome their domestic energy deficits, which are considerable. These two countries will still need more electricity to support industrialization initiatives and improve citizens’ quality of life after the pipeline is built. They’ll still need power plants — and they should try to meet that need by building solar farms, wind parks, and hydroelectric dams. I happen to think they should also build natural gas-fired thermal power plants (TPPs), which boast lower emissions than facilities that burn petroleum products, but my point is: There’s nothing about building an oil pipeline that takes renewable energy off the table. (In fact, small-scale, locally-oriented renewable facilities may also have the advantage of not being subject to the deficiencies of East Africa’s transmission networks.)

So it’s wrong to describe this as an “either-or” situation, in which a binary choice must be made. It’s a “both-and” situation. Tanzania and Uganda stand to benefit from pursuing both renewables and an oil pipeline. Let’s not stand in their way by framing the matter incorrectly.

Local Impact and Local Content

Second, you’re wrong to conclude that EACOP overlooks the interests of Ugandan and Tanzanian citizens and the communities along the pipeline route.

Yes, Total and other corporations involved stand to benefit from this project. (If they didn’t, they’d never agree to pump billions of dollars into it, and they might have a hard time convincing reputable service providers to sign contracts.) Greenpeace has never invested in any country and has never created a job. Okay they create a few jobs for drivers of the western aid workers in Africa.

But Uganda and Tanzania will benefit, too from Total’s investment. These two countries will earn revenues from oil flows through the pipeline and from oil sales. (Uganda alone may bring in as much as US$2 billion per annum over a period of at least 20 years.) Their governments will collect taxes from the local contractors that see their income rise as a result of their involvement in the project. Their businesses will profit from dealings with Total and CNOOC, which will have to hire local contractors in order to comply with local-content regulations and uphold their own contractual commitments. Their people will reap the rewards of the social welfare and infrastructure development projects these companies plan to carry out. Their societies as a whole will benefit from the construction of new infrastructure facilities such as roads, airports, hotels, and communications networks.

What’s more, ordinary Ugandans and Tanzanians will have a better chance of finding work once Total starts building the pipeline, for this project promises to create jobs — tens of thousands of them, and perhaps more than 100,000 of them overall. Samia Suluhu Hassan, the president of Tanzania, said on April 11 that she expected EACOP to create at least 10,000 jobs.

Mary Goretti Kitutu, the energy minister of Uganda, went into more detail, saying on the same day that she expected around 14,000 men and women to be hired directly by Total and CNOOC. About 57% of these people will be local workers, she added. She also stated that the upstream and midstream projects were likely to create many more jobs indirectly, with contractors to Total and CNOOC hiring around 45,000 people and businesses in other sectors taking on perhaps another 105,000 employees to handle the extra activity arising from oil operations. Facts and truth can be stubborn for those who believe foreign aid, begging and immigration to Europe should be the only way out for African youth.

Of course, these jobs won’t all last forever. Many of them will involve construction or related activities, and these will naturally come to an end once the construction projects are finished. While they exist, though, they will give tens of thousands of Africans the chance to earn larger salaries — and, potentially, gain more experience and obtain more training than they had before and start a sustainable business. As such, they have the potential to improve tens of thousands of lives in Africa — not just by increasing wages, but by creating opportunities for local workers to pick up skills they can still use after the pipeline is finished.

So it’s wrong for Greenpeace and the anti-African energy crowd to say these projects merely pay lip service to local communities. Officials in Uganda and Tanzania have worked hard to ensure that the EACOP project has a far-reaching and positive impact, and they have established new laws and policies to guard their citizens’ interests.

Take Up the NGO’s Burden: Who Are the Real Neo-Colonialists?

Finally, Greenpeace and the western anti-African energy crowd are wrong to describe EACOP as a “neo-colonial” endeavor. Come on this gives Chutzpah a new meaning.

Yes, there are foreign companies involved – Total, based in France, a former colonial power, and CNOOC, a company based in China, a rising power that stands ready to assist less-developed countries, provided that they agree to loan terms that are sometimes predatory. And yes, the largest portion of the EACOP consortium has been assigned to Total, which holds a stake of 72%. (CNOOC, meanwhile, has 8%.) But these foreign companies aren’t working alone. EACOP will also include Uganda National Oil Co. (UNOC), with 15%, and Tanzania Petroleum Development Corp. (TPDC), with 5%.

Take a close look at those numbers Greenpeace. You’ll see that both transit states have an equity stake in the pipeline — and that one of them has a larger stake than Total’s Chinese partner. Let me also point out that even if Total does have the largest stake, it is also serving as operator of the project and will assume most of the risk. As such, it stands to lose much more than UNOC, TPDC, or CNOOC if EACOP fails. That is how free markets work. You can’t love jobs and hate those who create jobs. Let’s face it, we in Africa need more free markets than communism. Free markets are still our best path to prosperity.

Tell me, how exactly is this “neo-colonial” arrangement? Have Uganda and Tanzania really bowed under pressure from powerful external forces, or have they spent years negotiating a deal with two foreign companies that agreed to their conditions?

And speaking of pressure from powerful external forces is Greenpeace’s approach truly free of “neo-colonial” elements? I didn’t know Greenpeace was a Pan Africanist NGO. Is the NGO using its position as one of the world’s most well-known environmental groups to ensure that local environmental advocates have a bigger bully pulpit? Is its opposition to EACOP rooted in the dreams and desires of ordinary Ugandans and Tanzanians, or is it trying to impose a solution from outside, on the basis of the global environmental movement’s pre-existing animus towards fossil fuels?

It’s wrong to use a historically and emotionally loaded word like “neo-colonialism” in this instance. It’s wrong to imply that Tanzania and Uganda have been coerced into working with foreign corporations, and it’s wrong to invoke colonialism in the hope of convincing Africans to listen to a different group of people who think they know best. Let Africans decide for themselves!

Balancing Environmental Risks with Other Crucial Considerations

Listen, I don’t fault Greenpeace for the concerns it expresses about environmental risks. The NGO is not wrong to point out that with pipelines, there will always be the danger of spills, leaks, and damage to surrounding ecosystems and habitats. I hope it continues to advocate fiercely for the African landscapes that Greenpeace mentions, such as the Murchison Falls National Park, which is the largest and oldest nature reserve in Uganda. That advocacy is its mission — and frankly, the business community needs to listen to critics as well as cheerleaders so that it can learn, improve, and give back to host communities. (Government officials must do the same so that they protect their constituents even as they guard revenue streams.)

But Greenpeace is wrong to argue that EACOP is not worth pursuing because it will overshadow renewable energy, because it will ignore the interests of the countries involved, or because it represents some type of neo-colonialism. Instead, it’s overstepping – and in the process of doing so, it’s wasting time that could be spent looking for ways to balance environmental protection with other crucial considerations, such as job markets, entrepreneurship, energy poverty, and budget revenues.

So let’s not waste any more time. Let’s strive towards that balance.

Let’s start now.

NJ Ayuk is the Chairman of the African Energy Chamber

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry

We Must Support Mozambique Overcome Terrorist Forces, Protect Lives, and Restore Hope

April 4, 2021

By NJ Ayuk

“You may kill me with your hatefulness, but still, like air, I’ll rise”. Maya Angelou was so right. These profound words do ring true today when we look at the recent coward attacks by terrorists against defenseless Mozambicans. There’s so much at stake in Mozambique, where the separatist militia known as Haul Sunnah Wa-Jamo (ASWJ) has stepped up its campaign to seize territory in Cabo Delgado, the country’s northernmost province.

On March 24, more than 100 ASWJ fighters attacked Palma, a town in Cabo Delgado, from three sides. Mozambique’s Defense and Security Forces, known locally as SDS, moved in quickly and mounted a counter-attack the next day, but they were not able to regain control immediately.

Moreover, they did not arrive in time to prevent Palma’s residents from violence and death. As of the time I’m writing this, the number of exact casualties is still unknown, but credible sources have reported that there are dead bodies on the streets of the town — and that some of the corpses have been beheaded.

High-Stakes Conflict

Mozambique’s government has strong incentives to push back against ASWJ, which has been staging deadly attacks in Cabo Delgado since 2017.

From a diplomatic and political standpoint, it is keen to preserve the territorial integrity of the country and quash the threat to the central government’s authority. (This is a sensitive issue, since many residents of Cabo Delgado feel marginalized and ignored by the government, even if they don’t view ASWJ as a viable alternative.)

From a geopolitical standpoint, it is intent on prevailing against a group that is serving as the local arm of the Islamic State, also known as Daesh. It’s not interested in letting the country become a haven for terrorism. And yes, this is terrorism – not fighting, not unrest, but terror. Sometimes we in the energy industry have to call it for what it is, no matter how careful we may want to be.

Mozambican leaders understand very well that launching a counterinsurgency push in Cabo Delgado against these extremists will not just defeat the tiny and desperate bands of armed terrorist. Instead, if experience in the rest of the world is any guide, it could transform these zeros into heroes. It will embolden them and strengthen their resolve. And it will enable them to excel in their favorite role, that of persecuted martyr. We must win them over with carrots and sticks and transform communities. Pretty smart thinking. They want to do this right and they want results and still keep the country together. We should support them.

From an economic standpoint, it is determined to eliminate obstacles to the development of the huge natural gas fields that lie off the coast of Cabo Delgado. These gas reserves have already attracted more than US50 billion worth of investment commitments from consortia led by major international oil companies (IOCs) such as France’s Total, Italy’s Eni, and U.S.-based ExxonMobil. Total and its partners have already devoted a great deal of time, effort, and money to the establishment of an onshore base and liquefied natural gas (LNG) plant on the Afungi Peninsula.

This complex, which is just a few kilometers away from Palma, will support upstream development work at the offshore block known as Area 1. It isn’t yet complete, though. If it can’t be finished, Total will have a hard time proceeding with its US20 billion Mozambique LNG project — and Eni and ExxonMobil will have a hard time following suit with their own South Coral LNG and Rovuma LNG projects. This is a real threat, given that Total had to suspend work and evacuated energy workers from the construction site in January, following a series of attacks near Palma in December. Indeed, it’s worth noting that the attack on Palma occurred shortly after reports emerged that Total was preparing to bring workers back before the end of March.

Terrorism and Human Suffering

But the threat to Mozambique isn’t just about gas. It isn’t just about money or security or power or territorial integrity.

It’s also about people. Human beings.

The conflict in Cabo Delgado is wrecking people’s lives on a vast scale. More than 700,000 people have already fled their homes in northern Mozambique, and the count is still rising. According to the United Nations’ refugee agency, UNHCR, the number could top 1 million by the middle of the year if the international community does not take steps to end the conflict.

Thanks to the support and encouragement from President Filipe Nyusi, his government and the governor of Cabo Delgado. I went to Cabo Delgado. The President and Mozambican officials ensured my delegation had complete and unfettered access to the region. Even during the attacks, I still had a team in Cabo Delgado. I’ve seen this suffering firsthand. I paid a visit to a refugee camp in the region. I talked to people who have been hurt, who have seen their family members slaughtered by ASWJ fighters. I met children, some of them as young as 8 or 9 years old, who have been assaulted by terrorists.

And these traumatized souls are living in makeshift, flimsy facilities that are basically made of leaves!

I’m heartbroken and outraged. I’d like to say I’m hopeful that things will change soon, but the UNHCR’s forecast of an increase in the number of refugees over the next few months gives me pause. (It’s also sobering to hear that the UNHCR has only been able to raise 5% of the US254 million in funding that it sought for its work in Mozambique last November.)

Cabo Delgado Needs More Than Security

I’m not trying to give the impression that nothing is being done for Cabo Delgado and its people. That would not be fair or accurate.

With respect to security, Maputo has pledged to work with Total to establish a safe zone around the gas complex on the Afungi Peninsula. It will have to step up its efforts on this front, given that the attack on Palma occurred inside the perimeter of the designated zone, but it is seeking help. Also, earlier this month, Mozambique’s government invited U.S. military advisors and special forces into the country to deliver counter-terrorism training. It has also accepted an offer from Portugal, its former colonial ruler, to provide additional training for the Mozambican armed forces.

But this isn’t going to be enough.

Even though Mozambique’s government is committed to doing everything it can to bring real peace and stability to Cabo Delgado, it needs more support than it is currently getting. It will need ongoing support from the international community — not just in response to the most recent attacks, but for the long haul.

If it doesn’t get that, ASWJ will continue to wreak havoc and force people out of their homes, making terrorism the biggest cause of poverty in Mozambique. If there isn’t enough help — and if large-scale projects like Mozambique LNG no longer are an option to create jobs and grow the economy — the country will sink further into despair. Cabo Delgado’s people will feel even more marginalized. The country’s natural environment will continue to suffer damage, and there will be no one available to help.

Doing More — And Doing Better

So now more than ever, we have to find ways to combat terror in Cabo Delgado.

There has been talk about negotiations and giving amnesty to ASWJ members who give up the fight. And as I’ve already mentioned, there are plans to provide training and advisory services to Mozambique’s armed forces.

But we have to do more, and we have to do better — not just the international community, but all of us, as individuals and business leaders.

We can start by denouncing the evil that we’re seeing in Mozambique. We must condemn the assaults and the crimes that are being committed by the terrorists who seek to gain control of Cabo Delgado. We can’t just remain quiet, as if nothing consequential is happening there. We must give President Nyusi the necessary support and backing to fix this.

Right now, more than ever, the country needs our support and our voices, and our involvement. “Leaving behind nights of terror and fear, I rise. Into a daybreak that’s wondrously clear, I rise”. Concluded Maya Angelou. Energy workers, Palma, Cabo Delgado and Mozambique will rise out of this like the African sun rises everyday.

NJ Ayuk, Executive Chairman, African Energy Chamber (www.EnergyChamber.org).

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry

Peace in Dakar critical for Economic Prosperity

March 15, 2021

By NJ Ayuk

The world woke to unusual images on their television screens last week with looting, vandalism and rioting portrayed on the streets of the Senegalese capital. The worst civil unrest in Senegal in decades was short-lived, but has left a distinct mark on the country’s international image.

After all, Senegal has presented itself as the shining star of West Africa in recent years. In addition to the country being an oil and gas hub spot, Senegal is also a center for renewable energy investment, business development, and for galvanizing growth in sectors such as tourism and fishing. Accordingly, it is not surprising that images of burning cars and stone-throwing protestors caused concern, particularly when they are followed by shots of destroyed supermarkets and fuel stations, all of which are symbols of well-established foreign companies in Senegal. It is curious that a story about a political leader being taken to court on rape charges who is then arrested for inciting civil unrest translated into violence against foreign companies. Curious and concerning, that popular dissatisfaction be directed in this manner: to undermine businesses and wealth-generating enterprises.

Senegal is undergoing a veritable economic revolution that has the power to lift millions out of poverty and provide jobs, wealth and prosperity for the whole nation. Through the exploitation of its energy resources, both renewable and non-renewable, Senegal is witnessing a renaissance that will open a myriad of new development opportunities, power the country and offer the next generation of youth choices that no Senegalese has had in the past. However, for this potential to be fulfilled, the country needs foreign investment, know-how, training, skill-transfer and, above all, stability. No foreign company is interested in investing in a destination where its offices are at risk of being vandalized every time an opposition leader is unwilling to face the country’s legal system and uses social fears to distract the public debate.

President Macky Sall has done a tremendous job in attracting investors and opening opportunities in the Senegalese market in which business is already producing jobs, wealth and growth in the economy, particularly through the country’s vast energy resources. These efforts must be supported by all and maintained through a stable, business-friendly and transparent environment.

If we turn on ourselves through violence to express our grievances, we will end up driving away the very opportunities to address the problems behind those grievances, be it poverty, unemployment, social inequality or access to education. We need to stand together behind the political leaders that are driving our country and our continent forward, and support those companies that are developing our resources so that together we can create value, jobs and wealth for all.

NJ Ayuk is the Executive Chairman, African Energy Chamber

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry

A Few Thoughts for this Generation of Africans in 2021: Be Bold and Cut Out Entitlement, No One Owes Us Anything

December 28, 2020

By NJ Ayuk

In 2021 most opportunities in the energy sector and in business in general will go to those who show up and negotiate better deals and get involved in making African resources work for us. Forget handouts, foreign aid and government handouts.

As I wrote in the second edition of Billions at Play: The Future of African Energy and Doing Deals, in 2021, young African dealmakers, negotiators and lawyers will have to embrace a new mindset to win. They will have to mobilize their resources and advocate for important principles of personal responsibility, smaller government, lower taxes, free markets, personal liberty, and the rule of law.

In 2021, African gas projects are going to be in the news. Companies will push to get them going, from Mozambique to Nigeria and from Equatorial Guinea to Tanzania.

If some extremists have their way, none of these projects should happen and our people should be left in the dark. Question we must also ask is how Africans are going to participate when it comes to jobs and contracts. In 2021, we cannot be bystanders. We all can’t afford to.

Africa’s economic recovery from Covid-19 and our global significance in the era of energy transition and attacks on our energy sector must be driven by the talent and entrepreneurship of its people.

Our continent is still struggling when it comes to establishing democratic and trade institutions, we must push for more democracy. Democracy isn’t perfect but it is the best of all political practices and we must embrace it.

I have a few words of advice for this generation, for Africa’s young attorneys, entrepreneurs, rising stars and dealmakers:

Never lose sight of the significance of your work.

By negotiating effectively for African businesses and governments, you can play a huge role in transforming the lives of hundreds of thousands of Africans. Few things in life are more satisfying.

I am proud of the law group I have built, but I consider the work I have done to get justice for and empower African individuals, businesses, and communities among my greatest successes.

I am the first to advise many young people to avoid feeling entitled to anything. No one owes you or us anything. We have to earn it. Our approach and success in oil and gas negotiations stem from our deep preparation and mindset. More of that is needed in 2021.

I have stated many times: you succeed when you look for mentors and let them mentor you. It’s important to have someone who is promoting you when you are not in the room. Next, be stubbornly loyal. Don’t try to pull a fast one because you know more than others! Further, embrace your trials and shortcomings for they teach you to be a better person and lawyer.

I have seen too many young lawyers or rising stars who get a chance to be on a podium, and then tend to spend more time being celebrities than being around colleagues or supervisors.

Many so-called celebrities have not earned a deal and completed one, so avoid having a big head. For me if you have not closed a deal and are not making money, you need to keep your philosophies to yourself. It is crucial to have a strong focus on building your skills because clients and business partners really want you to be good at what you do. Your writing, critical thinking, commercial mindset and in-depth industry skills cannot hurt you. Most clients want to know who is working on their deals, and they do not care about your race or nationality. They want to know you are qualified and can get the job done.

When you finally get a deal done and you get your first bonus or check, do not fall in the trap of buying that fancy car or getting into fast life. You will get broke so quickly. Spend wisely even when you think you have arrived where you need to be. Always think there is more and stay hungry. Look at the Texas oil boys, they are always hungry. They wear their cowboy boots and continue searching for the next big discovery.

Hashtags do not pay the bills. Get off your phone.

Get offline, social media is nice but it isn’t everything, we have seen people who prefer to sit on their phone even during business meetings rather than engage in real business. How do you want a deal when you are busy on your whatsapp group chats? Why have a meeting with someone when you will be on your phone while they are talking? Get out of the room and take the call or send a message. If you decide to work on your Instagram while talking to me, I walk you out of my office or end the meeting. When you don’t get the job or the contract, don’t be so quick on blaming the “White Man” or Racism.

I know this will get the young generation annoyed, but its real. We need to start having a post covid mindset and know we will have to engage again. I am not crazy about Zoom meetings, but we have to do it. Business is not about who had the best tweet two hours ago or who does the best hooting and hollering. Get down on the ground and make money. Do not believe those who tell you money is bad. We know it is bad being broke and we hate being broke. You should never apologise for working hard and making money. To do that, you must be focused and yes, get off your phone.

Commit to work. Pay your dues. Your time to shine will come.

Always ask yourself, “Am I adding value to the firm or the company?” Don’t think you are in the firm to be the labor union representative or the head of diversity.

Do not walk around the firm or even negotiate with arrogance or give off a sense that you are entitled, or that your opinion matters on every subject. You are not owed anything. It is important not to cry over discrimination on every issue, whether it is sexism, racism, or xenophobia.

You beat them with excellence and success. We see it every day and you will be surprised it comes from the same liberals who claim to love all humans and want to save the world. They will love to patronize you and put you in your place. I have experienced it myself. I just work harder, and success follows.

You must understand that building a successful practice or business calls for something not taught in law school or business school or any school: the ability to hustle and deliver on deals. I have always had run-ins with young lawyers because I can be a tough, goal-oriented taskmaster. I have a fierce sense of urgency that many others don’t share.

Working for Centurion is not for the naïve or the fainthearted—we don’t tolerate young lawyers viewing Centurion as merely a job. Everyone has to give their maximum effort all the time.

The truth is, I am harder on myself. I am never satisfied, and I just believe I can win bigger and do the deal better. The most important outcome for me is to have people around me achieve more than they ever thought they could.

Lean in and take the heat for your client or causes you believe in, and for Africa

In 2021, you will have to be visible, be vocal in defending the African energy sector from those that want to end it and you must capitalize on the opportunities that you see. One of the key things you must do in 2021, is take the heat for your clients. I have never had a problem being called an ambulance-chaser in the past. Today I am that ambulance that is being chased and many know I will always stand with them and I built a strategy of taking the heat for them. Don’t let them push on your client or kill your issue. Develop a thick skin and let them hit you. If I can’t take the heat, I have no business being in the kitchen.

I have been pushed, been kicked, sometimes been spat on, lied on, demonized, talked about and even derided in the media. Its does not bother me one bit, I always know I am going to outlast my distractors or competition. In 2020, we made more money than any other year with Centurion Plus, our latest on-demand service. I have also been invited to meet with Presidents, Ministers, CEO’s and even Royals. But I never lost my way.

Never take your eyes off the prize. Be patient, play chess, keep smiling, be ready to take a punch and definitely hit back and do it harder. Maybe a combination of Jabs, Uppercuts and Hooks. That’s going to be you in 2021. Its going to be a fight to stay alive, stay employed, stay in business, stay relevant and stay sane when everything and everyone around you is going crazy.

You are going to be tested. They are going to come after you. sometimes even your own friends and those who laugh with you then stab you in the back. You will be called a traitor to most of your liberal elitist friends who feel entitled, drink latte with soy or almond milk. They sometimes cannot believe that this kid who was their darling and their best boo does not buy into their tree hugging, cry me a river ideology. You and I will have to believe and fight for Africa first, against energy poverty, and for personal responsibility, free markets, limited government and yes we must not be ashamed of being people of faith.

The wisdom and advice my law school mentor and professor John Radsan, who used to serve as the CIA’s assistant general counsel and Ron Walters shared with me hold true for you today: each one of us has a mandate to use our education and skills to impact communities and to promote economic growth and empowerment.

So, yes, seek career success and prosperity in 2021. But, in the end, choose to do good: use your skills to make sure that everyday Africans receive their fair share of the benefits the continent’s natural resources can provide.

NJ Ayuk is Executive Chairman of the African Energy Chamber, CEO of Centurion Law Group

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry

Senegalese President Macky Sall is right about African Debt Relief – and the G20 shouldn’t stop there

September 14, 2020

“Flatten the curve.” Do you remember that phrase? It was on everyone’s lips back in the spring, when the novel coronavirus (COVID-19) pandemic began rampaging across the world in earnest. At the time, the idea was that the best way to combat the germ known as SARS CoV-2 was to go home and stay there long enough for hospitals, clinics, and other medical facilities to build up the capacity needed to handle the expected flood of new patients. Most of us expected that this departure from routine would be a temporary thing. We hoped it wouldn’t last long — that we’d be able to return to our normal routines after a brief disruption, with confidence that all necessary safeguards were in place.

Of course, it didn’t turn out that way. We spent far more time than we expected sheltering in place, unable to visit friends and family, attend school, or go to work in the usual manner. Many of us lost our jobs and saw our businesses fail, and the cumulative result of all these individual disasters was that the global economy took a sharp downward turn.

We Still Need To ‘Flatten the Curve’ … But How?

Along the way, of course, we’ve learned quite a bit more about SARS CoV-2 — how it makes people sick, how to treat it more effectively, what kind of resources our medical providers need most, and so on. But we’ve also stopped talking about “flattening the curve.” Even in places where hospitals and clinics have been able to build up their stocks of personal protective equipment (PPE), ventilators, and other necessities, we’ve moved on to other topics.

In my view, this is a mistake. I’d like to explain why I think so.

It’s not because our understanding of the virus has changed over time.

It’s not because we’ve seen infection rates rise after the lifting of lockdown orders.

It’s not because we don’t have a vaccine yet.

It’s not because the idea of “flattening the curve” seems callous when more than 900,000 people out the nearly 28 million infected around the world have already died of COVID-19.

It’s because we need to rethink the idea of what “flattening the curve” means.

And I believe President Macky Sall’s call for African debt relief is a good place to start that rethinking.

The President’s Perspective

First, let’s look at what President Sall has to say. In late August, the Senegalese leader urged members of the G20 group of countries to continue helping African nations balance their obligations to creditors with their obligations to their own citizens in the face of a deadly pandemic. Speaking to a group of business leaders at the French Entrepreneurs’ Conference, he noted that the group had taken up his call for a moratorium on the collection of debt from impoverished countries in Africa and elsewhere in April. He suggested that this moratorium be extended into 2021 rather than allowed to expire at the end of 2020.

“For the most part, and for all African countries, internal efforts will not be enough to lessen the shock of COVID and revive economic growth,” he said. “We need more financial capacity, which is why, with other colleagues, I have made a plea for substantial relief of Africa’s public debt and private debt on terms to be agreed upon.”

What the President’s Words Mean

Sall’s statements reflect the fact that the emergence of SARS CoV-2 was not a one-off event that sparked a short-term crisis, but rather the start of a struggle that will take a long time to resolve. They recognize that the outbreak is likely to be a drag on the world economy for years to come — and that the countries battling COVID-19 outbreaks need time to build up their capacity to fight back.

What’s more, the president’s words advance the idea that African states will be in a better position to meet their financial obligations in the future if they take the time and the trouble to address the public health situation first. Indeed, he made a point of stressing that Africa takes its financial commitments seriously, since he mentioned debt relief and not debt forgiveness. (He also suggested that members of the G20 group offer debtors the same kind of breathing room they have granted themselves, such as temporary exemption from rules limiting debt to 3% of GDP or less.)

In other words, Sall is asking the G20 group to give Africa time and space to flatten the curve. He may not have used those exact words, but that appears to be his goal. He is hoping creditors will agree to suspend business as usual so that African states can build up their capacity for economic growth, just as regular citizens of many countries around the world agreed to disrupt their usual routines of work and school and leisure activities so that hospitals could build up their capacity for patient care.

Sall also understands that this flattening of the economic curve is not a simple process. He knows it will take more than one round of deferred payments to compensate for the economic consequences of the pandemic, and that is why he has now asked the G20 to extend the debt moratorium, which was originally due to expire at the end of 2020, into next year.

Compensating for the Setbacks of the Last Six Months

And make no mistake: Africa needs that extra time. The continent has suffered enormously over the last six months.On the economic front, the pandemic has triggered a global recession that has caused millions of salaried African workers to lose their jobs. Meanwhile, many more millions have seen their livelihoods dwindle or disappear because restrictions on movement have stifled the informal sector and forced the closure of small businesses. Additionally, the continent has experienced shortages of fuel and other essential goods as a result of disruptions in the supply chain.

Some parts of Africa have also weathered political disruptions. Mali suffered a coup in mid-August, following more than two months of anti-government demonstrations. Libya’s civil war, pitting the UN-backed Government of National Accord (GNA) in Tripoli against Khalifa Haftar’s Libyan National Army (LNA), has continued to grind on, effectively crippling the country’s lucrative oil industry. Investors in liquefied natural gas (LNG) projects in Mozambique have grown more nervous since a militia with ties to the Islamic State group, also known as Daesh, seized control of a key port in Cabo Delgado state.

Under other circumstances, African fossil fuel producers might have been able to use their reserves to help build up the cash needed to cope with the consequences of COVID-19. After all, as I explained in my latest book, Billions at Play: The Future of African Energy and Doing Deals, the oil and gas industry has the potential to serve as a springboard, amplifying and accelerating economic growth. It can create opportunities for economic diversification and — through petroleum companies’ research and investments — help pave the way to the creation of a renewable energy sector.

Unfortunately, though, world oil prices crashed earlier this year, partly because of the competition between Russia and Saudi Arabia for market share and partly because the pandemic undercut energy demand. Prices hit historic lows in late April. And since they have yet to recover completely, African producers will need more than oil and gas to compensate for the setbacks they have experienced this year.

A Necessary Step: Debt Relief

That’s where debt relief comes in.

Debt relief will help African states weather the storms caused by the pandemic.

Debt relief will help African states take the steps needed to help people go back to work or build up their businesses.

Debt relief will help African states re-establish stability following political disruptions.

Debt relief will help African states make up for the sharp decline in oil and gas revenues and begin building renewable energy sectors.

Debt relief is necessary to flatten the curve. It’s what will give Africa time and space to start carving out a path towards recovery — to take the steps necessary to bring new investment to the oil and gas industry, to build Africa’s sustainable energy sector, to expand business and residential consumers’ access to electric power, to revive small businesses, to promote innovation and entrepreneurship, to foster job creation, and to remove red tape and regulatory obstacles.

Asking for More: Debt Forgiveness

Senegal’s president understands this — and I hope the leaders of the G20 group’s members do, too. I hope they can see how reasonable it is for impoverished countries in Africa and other regions to ask for what they need to flatten the curve.

But I’d also like to take it a step further. I’m going to ask for more.

I’m going to ask for debt forgiveness.

I’m going to suggest that members of the G20 group agree to forego payments from African debtors — specifically, from eligible African debtors. And by eligible debtors, I mean countries that commit themselves to a forward-looking agenda that includes wide-ranging and market-oriented reforms, as well as safeguards for economic freedom, good governance, free trade, and investment in education.

All of these points are in line with the ideals that have helped most G20 member states achieve so much with respect to economic growth. What’s more, they are exactly the sort of things that African states ought to do in order to maximize their chances of building up the momentum lost as a result of the pandemic — and to extend their recovery far into the future, beyond the point when vaccines, cures, and more effective treatments remove the threat of COVID-19.

I hope that G20 lenders to Africa will see it my way. I hope they will agree to help Africa do as much as it can to flatten the curve

NJ Ayuk is the Executive Chairman, African Energy Chamber (www.EnergyChamber.org).

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry

European Travel Bans Will Hurt Africa’s Oil & Gas Sector’s Impact on Economic Recovery

July 4, 2020

The recent travel restrictions placed by the European Union coupled with restrictions of visa issuance are de facto preventing a lot of projects to move forward and to successfully contribute to the recovery of the continent warns the African Energy Chamber. The continuation of travel restrictions and suspension of visas and travel between Africa and Europe is heavily restraining the oil & gas industry’s recovery efforts. Because of its international nature, the oil & gas sector relies on global value-chains and successful cooperation and movement of people, goods and services between foreign and local contractors. The ongoing travel bans and restrictions of visa issuance are de facto preventing a lot of projects to move forward and to successfully contribute to the recovery of the continent.

Nj Ayuk, Executive Chairman at the African Energy Chamber

Major international oil companies such as Total, BP, Shell, Eni, ExxonMobil, Chevron or Equinor and independents such as Kosmos Energy, BW Energy, Maurel & Prom or Tullow Oil that operate a major share of Africa’s daily oil and gas production are currently unable to operate fully and safely because of such travel restrictions. Similarly, they directly impact the operations of the major international services and EPC companies supposed to work on major projects, such as Saipem, TechnipFMC, Schlumberger or Halliburton.

“We cannot base our recovery narrative and hopes on the oil & gas sector and at the same time forbid the movement and travel of the workers and employees supposed to make that recovery happen,” declared Nj Ayuk, Executive Chairman at the African Energy Chamber. “We are urgently calling for pragmatism and the adoption of realistic measures that put workers’ safety and economic recovery at the center of public and travel policies priorities,” he added.

From West to Southern Africa, landmark energy projects worth billions of dollars have been delayed because of the ongoing pandemic of Covid-19 and its subsequent lockdowns and travel restrictions. However, and as economies gradually reopen, a new wave of travel restrictions, especially on the issuance of visas between Europe and Africa, is adding up to the list of challenges the industry faces to play its key role in the continent’s economic recovery. Such restrictions are threatening the efficient operations of global value-chains whose functioning is critical to enable Africa’s energy projects to move forward.

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry

Deepening Crude Oil Production Cuts Will Favour African Oil Producers

June 8, 2020

African Energy Chamber’s Executive Chairman Nj Ayuk

Countries like Nigeria that have adjusted their 2020 budget twice due to the dwindling price of crude oil will heave a sigh of relief with the decision over the weekend by the Organisation of Petroleum Exporting Countries (OPEC) decision to extend production cuts. This is in addition to the gradual reopening of world economies along with increased conformity to the production cuts have allowed oil prices to bounce back and reach the $40/bbl threshold.

The 11th OPEC and non-OPEC Ministerial Meeting concluded on a series of decisions which will help maintain a still fragile market stability, and which should be supported. Held via videoconference on Saturday, June 6th, the Ministerial Meeting reconfirmed the existing arrangements under the April agreement and extended the production cuts of 9.7 million barrels per day by another month, until July 30th 2020. The deal was initially due to expire on June 30th.

In addition, all participating countries subscribed to the concept of compensation by those countries who were unable to reach full conformity to the agreement in May and June. As a result, and in addition to their already agreed production adjustment for May and June, countries who were not able to comply for these two months expressed their willingness to compensate for it in July, August and September.

The reaffirmation of the OPEC+ commitment to the historic deal made last April comes on the back of a steady rise in oil prices. Gradual reopening of world economies along with increased conformity to the production cuts have allowed oil prices to bounce back and reach the $40/bbl threshold. The rise has been especially beneficial for Nigerian and Angolan blends.

“OPEC is taking the right steps to respond to the market and should be commended. Uncertainty is bad for the oil industry and the extension of OPEC’s cuts ensures market stability,” declared NJ Ayuk, Executive Chairman at the African Energy Chamber. “African energy companies and even state companies are facing a battle with liquidity because of the price war and the coronavirus. They do not have state bailouts as their Western counterparts. We hope the production cuts will give the market a boost, however compliance and collaboration from the G20 is key. OPEC has proven its ability to show leadership in times of crisis. We are all in this together,” added Ayuk.

Earlier this month, the African Energy Chamber had called for an extension of the 9.7 million b/d production adjustment and urged all producing countries to ensure their conformity to the agreement. The rebalancing of the market is key for African oil-producing nations to preserve jobs in the sector and give the continent an opportunity to stabilize and recover.

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry