Nigeria on “brink of a new era” say President at energy summit

(Abuja, Nigeria) — African leaders and energy experts emphasised the need for energy security and financial resources for Africa to achieve a just and orderly energy transition at the Nigeria International Energy Summit (NIES).

This was said on Tuesday in Abuja at the launch of the seventh edition of the summit, the official industry event of the Federal Government of Nigeria.

The summit is a global platform for stimulating discussions, interactions, and signing high-level deals in the oil and gas sector. It brings together governments, national and international oil companies, independents, investors, and service providers from Nigeria and other countries worldwide.

During the official launch of the summit, Nigerian President Bola Tinubu emphasised that the country must leverage innovation and collaboration to ensure a smooth and just transition that will leave no one behind. The President, represented by Mohammed Idris, Minister of Information and National Orientation, noted that the petroleum subsidy had strained the country’s economic resources, leading to inefficiencies and hindering its ability to invest in critical areas of energy security.

“We are creating a more transparent and accountable energy sector. The funds that were previously allocated to subsidising petroleum products are now redirected towards developing and upgrading our energy and other social infrastructure,” he added

“While we are immersed in energy security, let us not forget that energy transition is another key aspect of our discussions. We stand on the brink of a new era, where traditional energy sources are being complemented and, in some cases, replaced by cleaner and more sustainable alternatives. This transition is not only an environmental necessity but also an economic opportunity,” the President stated.

A Special Adviser to the President on Energy, Olu Verheijen, during a plenary session, said the global energy markets have gone through an exciting phase since the Russian-Ukraine war. She said this means that Nigeria has a role to play in meeting energy security domestically and globally.

Affordability of sustainable alternatives

Olu said Nigeria and other African countries have to make sure that the transition from fossil fuels matches the affordability of sustainable energy sources. “So when we look at the levelised cost of solar, especially grid-scale solar alternative energy sources, it is still twice or three times the cost of gas. I think the idea and the theme of this conference is really to think through what we can do to enable ourselves to provide energy security, to make sure we’re doing so sustainably, and that we can make sure that this is affordable.”

According to Ekperikpe Ekpo, Nigeria’s Minister of State for Petroleum Resources (Gas), energy finance is essential for transformative endeavours, and the gas sector is not exceptional. He said during his address that attracting domestic investment is important to unlock the full potential of Nigeria’s gas resources.

“Cooperation from international partners and financial institutions is vital for gas infrastructure development. The nation is rich in natural gas reserves. It is now essential to strategically channel these reserves into job creation, poverty eradication, and environmental sustainability.

Expo said the shift toward gas is an option and a necessity for Nigeria’s economic development, an opinion that many energy transition experts and climate leaders would regard as unhelpful since they think gas should not be a component of the transition at all. “We will continue the development of energy infrastructure while ensuring natural gas is affordable for domestic consumption and encourage the adoption of compressed natural gas for transportation and household use, respectively, “ he said.

Creation of African Energy Bank

At the summit, Dr Omar Ibrahim, the Secretary General of the African Petroleum Producers’ Organization, said energy security is important in every country to industrialise the economy and improve people’s lives.

He said African countries need to focus on permanent emissions, not the temporary ones. “Africans can’t afford to abandon their thousands or millions of barrels of gas in the name of righting the wrongs committed by others, especially when those others are still benefiting from the wrongs that they chose at the expense of others. And they have the capacity to right the wrong without denying others the opportunity also to use the same energy to better their lives or their people.”

Dr Omar said that looking to the same source for financing for technology and markets for Africa’s energy transition will not work. He said financial issues had formed the basis for establishing the African Energy Bank in collaboration with the African Export-Import Bank.

“I’m pleased to say that this bank will take off by the middle of this year. A decision on the energy bank headquarters shall be taken in the first quarter of this year, that is, by the 31st of March. Seven countries are in for the vote: Algeria, Egypt, Nigeria, Ghana, South Africa, Benin Republic and Cote D’Ivoire.”

Technology and expertise challenge

According to Dr Omar, beyond finance, there is a technology and expertise challenge in Africa’s energy transition. He said no African country can succeed in the oil and gas industry if Western countries decide to move away.

“And none of us has the money to establish the kind of research institutions that can make us excel,” he added.

“Finally, there is no point we’ve been told severally that we are too poor to buy energy. Ladies and gentlemen, I don’t believe we are poor. Africa is rich, our governments are rich. If only they will seek and prioritise and eliminate corruption.”

This is the first of two conference round-ups from our Africa Correspondent Samuel Ajala. Read the second here.