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African Development Bank and South Sudan Recruit Pan-African Centurion Law Group to Strengthen Capacity in the Oil & Gas Sector

August 1, 2019

Following an open tender and a highly competitive international bidding process, the African Development Bank through its African Legal Support Facility (“ALSF”) and the National Petroleum and Gas Commission, representing the government of the Republic of South Sudan, selected the Centurion Law Group to build capacity in the Republic of South Sudan’s oil and gas sector.

The project is a result of the ALSF’s commitment to foster legal and technical best practices and transparency across South Sudan’s oil & gas value chain. It will focus on providing specialized capacity building training to officials from the National Petroleum and Gas Commission, including the development of best practice procedures for the negotiation, evaluation, and monitoring of contracts in the oil and gas sector.

As South Sudan continues to increase oil production – its most important export commodity – and attract foreign investment into its oil & gas sector, this project will enhance the National Petroleum and Gas Commission’s ability to fully exercise its functions as a regulator and a facilitator in the oil sector.

As per the South Sudan Petroleum Act of 2012, the National Petroleum and Gas Commission notably provides general policy direction with respect to petroleum resources, acts as a supervisory body in matters relating to petroleum resource management, approves all petroleum agreements on behalf of the Government and ensures that they are consistent with the Act.

“The National Petroleum and Gas Commission is a key institutional pillar of South Sudan’s oil & gas sector,” declared Hon. Caesar Oliha Marko, Chairperson of the Commission. “We are delighted to be working with a reputable firm like Centurion to enable our country’s oil industry to meet its obligation to our citizens and investors. Building capacity is key to us ensuring that we deliver on the promise of making oil work for everyone in South Sudan”.

The project will notably focus on reviewing South Sudan’s existing legal and fiscal framework and ensure the transfer of skills and know-how to the government’s representatives and experts.

“It is a real honor to have been selected for this project with the Petroleum Commission,” declared Nj Ayuk, CEO of the Centurion Law Group. “Local content development and domestic capacity building are at the core of everything we do as a firm. We take this project as a unique opportunity to contribute to the development of South Sudan and Africa’s oil industry in general. We are grateful to the African Development Bank and the Republic of South Sudan for entrusting us with this responsibility.”

“As a team, we truly believe in the role the National Petroleum and Gas Commission has in shaping the future of South Sudan’s oil & gas sector,” said Glenda Irvine-Smith Centurion’s Director of Business Development & International Relations, who will coordinate the project on behalf of Centurion.

“South Sudan in East Africa’s most mature petroleum province with the potential to double its current output of over 150,000 b/d in the next five years. Through CenturionPlus, our lawyers and experts on-demand platform, we will mobilize the best African and international experts for the benefit of South Sudan. We are honored to have been entrusted by the Commission and the African Development Bank to accompany South Sudan in this journey.”

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.

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Africa needs the private sector to bridge the infrastructure gap – Zubairu

July 30, 2019

Samaila Zubairu is President, Africa Finance Corporation (AFC), a pan-African multilateral development finance institution focused on infrastructure development in Africa.

In this interview, he speaks on the need for Africa to bridge its yawning infrastructure gap and how the AFC is working towards providing the infrastructure base that will allow for regional trade to take place on the continent. Excerpts:

Despite efforts of development finance institutions to boost infrastructure outlay, Africa still has a huge infrastructure deficit. What needs to change to bridge the gap?

There are several ways of looking at Africa’s infrastructure gap. Let’s start at the macro level. Look at the investment required for infrastructure; it is about $170billion annually and most of that is for water and sanitation infrastructure which should take $67billion. Energy requires an investment of about $50billion, transport and logistics take $47billion while ICT takes $7billion.

However, Africa has been spending $77billion annually on infrastructure in the last seven years and that leaves a deficit of about $93billion. So, we should look at areas where the private sector can come in such as transport and logistics, based on a public-private -partnership basis.

Why is PPP not as forthcoming as you would like?

There are several points through which the private sector can come in. Water and sanitation is a bit of a challenge for private sector investment because they are viewed as social goods and so governments need to really concentrate on that. For energy, what is important is a pragmatic view of what is required. Governments fail to understand that they alone cannot make the investments that the continent needs, so they need private players. However, they need to de-risk the sector for private capital to come in.

So, the big challenge with infrastructure is that private capital is not flowing into that space. Capital is shy and you have to make it comfortable. So, African governments need to understand that they should make investors comfortable so they can come into the sector and once the sector receives these investments and the critical mass is built, they can withdraw the credit enhancement that is required to attract the investment.

Which countries have successfully deployed this model you described?

We have seen it in several economies. For example, in Turkey, they had bankable power purchase agreements (PPAs) to mobilize and encourage investors. However, when they achieved the requisite investment critical mass, they stopped providing the PPAs. So, there are no PPAs in Turkey today, as the power market has stabilized. Businesses produce the power and the government buys as it needs.

The AfCFTA has come into force and a common market will be launched in July. What role can the AFC play to ensure that it achieves its goal?

We have always believed that infrastructure deficit is a hindrance to regional trade. Africa has the lowest level of regional trade in the world. Some say it is at 10 percent while others say it is 18 percent.

However, the best estimate we have seen is 20 percent which is still very low when compared to Europe where it is 70 percent and Asia at 60 percent. A major bottleneck is an infrastructure. For example, a company in Nigeria finds it difficult to export to Cameroon or Benin Republic because of poor infrastructure. What we are trying to do at AFC is to provide that infrastructure base that will allow for regional trade to take place.

Kelechi Deca