The International Energy Agency (IEA) has released a report that makes a strong case for ending the use of fossil fuels and promotes unrealistic and unachievable approaches to achieving net zero consumption by 2050, while that the Conference of the Parties (COP28) is about to take place. The report notes a rapid decline in oil demand, calls for an immediate transition to renewable energy and says carbon sequestration is an illusion. As the African Petroleum Producers Organization (APPO) rightly points out, the IEA’s approach has detrimental effects on African economies, as it represents a biased perspective that does not take into account the needs and challenges from the continent.
Africa is on the brink of rapid economic transformation. The continent holds more than 125 billion barrels of crude oil reserves and 620 trillion cubic feet of natural gas reserves, resources that can serve as catalysts for industrialization and economic development. These resources can provide affordable energy to more than 600 million people and 900 million people who currently lack access to electricity and clean cooking solutions, respectively. Yet at the same time, the continent faces the worst effects of climate change and is being asked to abandon its oil and gas resources, despite contributing less than 3% of global greenhouse gas emissions. Greenhouse.
The IEA’s “solution” completely ignores countries’ development needs and ultimately limits economic growth and the energy transition. First, the IEA indicated that global oil demand is expected to peak in 2030, before falling by 45% by 2050. Other forecasts show a very different scenario. The US Energy Information Administration says global energy consumption will increase through 2050, while McKinsey & Company highlights that by 2040 Africa’s energy demand is expected to be 30% higher than it is today, demand far outweighs supply. Rapid population growth and industrialization are key factors. The United Nations predicts that Africa’s population will double by 2050, to more than 2.4 billion people, and double again by 2050 to 4.3 billion people. In this scenario, how can the IEA honestly predict a decline in energy demand?
From population growth alone, it is clear that Africa needs its oil and gas, and countries have encouraged investments in carbon capture, utilization and storage (CCUS) as way to ensure the safe, clean and sustainable use of hydrocarbons in Africa. CCUS provides a strategic opportunity for countries to meet energy demand while reducing emissions. Yet the IEA report paints a very different picture. The IEA believes that the CCUS is inadequate and instead encourages investment in renewable energy – resources that do not have the capacity to meet Africa’s industrialization needs.
IEA Executive Director Fatih Birol says “oil and gas producers around the world must make profound decisions about their future place in the global energy sector. The industry must commit to truly helping the world meet its energy needs and meet its climate goals, which means abandoning the illusion that implausibly high amounts of captured carbon are the solution. »
This statement is not only contradictory, but it ignores the fact that the oil and gas industry can only fuel the transition to a clean energy future through the adoption of CCUS technology. How is industry supposed to meet the world’s energy needs if it is pushed to abandon the only fuels that can meet that demand? How can the industry reduce emissions and promote clean energy technologies if it is asked to abandon carbon capture?
According to APPO, the IEA has failed and continues to fail to address the global reality of the phasing out of oil and gas. Mr. Ibrahim notes that “just a few years ago, the IEA claimed that it would be virtually impossible to achieve net zero without CCUS. It further asserted that CCUS should be a pillar of efforts to put the world on a path to net-zero emissions. What changed ?
When it comes to financing, the IEA ignores the fact that oil and gas represent the majority of African countries’ revenues. In 2022, Angola’s crude oil revenues stood at around $39 billion, Nigeria’s at $45 billion, and Algeria’s at $50 billion. Without these vital revenue streams, how is Africa supposed to finance its clean energy future? Between 2020 and 2030, Africa needs more than $2.8 trillion to achieve its national development goals. Where is this funding supposed to come from?
“Over the years, we have seen significant financial commitments from global partners. In 2009, developed nations pledged $100 billion in annual funding for developing countries, and yet between 2016 and 2019, only $20 billion was provided to Africa. The commitments proved unfulfilled, and the same goes for other financial promises made in the years that followed. In this scenario, Africa is not only deprived of the resources needed to finance a transition, but continues to be disappointed by empty global promises,” says Omar Farouk Ibrahim, Secretary General of APPO.
As COP 28 approaches, APPO urges stakeholders to consider Africa’s unique facts and challenges. For a continent that has provided the world with the energy needed for its development and prosperity, it is only right that Africa chart its own path towards a net-zero emissions future.
