ENERGY IN AFRICA
Africa’s new role in global energy security
Published: 09-FEB-05
There’s no doubt that African
oil and gas is a key engine
for economic and social
development on the continent
if managed half-decently. Oil
and production generate a large share
of revenue in many African countries,
with several new producers and prospective
producers on the verge of entering
the market up and down the Western
coast.
Needless to say, these natural
reserves are attracting the attention of
global players. The United States, in
particular, is starting to cast covetous
eyes towards the continent as an
increasingly important source of oil
and natural gas to stabilize its energy
market.
President Bush has apparently
“recognized the importance” of the
US’s relationship with the continent,
with the US looking to “support more
transparent, accountable and responsible
use of oil resources in African producer
countries to enhance stability and
the security of trade and investment
environments.”
What this
means in plain English
is that we can expect to see a steady
rise in US interest in African affairs
and politics to safeguard an important
alternative source of oil and gas. As we
have seen abundantly in the Middle
East, the US is never shy to use its
muscle when oil is involved.
Africa is currently producing well
in excess of eight million barrels of
Africa’s new role in global
energy security
oil per day and currently supplies the
US with about 12% of its oil import
requirements. Some analysts believe
production can rise as high as 11-13
million barrels per day in the next
decade.
Over the past decade, non-OPEC oil
production has more than kept pace with
the rise in world oil demand, thereby
limiting OPEC’s share of the market.
Only three African countries - Algeria,
Libya, Nigeria – are part of the 11-
member OPEC.
But while West Africa is one of the
world’s fastest growing sources of oil and
gas, it is also a deeply confl
icted region
that is suffering the effects of years of
corruption, political instability, border
disputes, ethnic and religious strife,
governance issues, and poverty.
As any businessman will tell you,
conflicts produce risks. And risks have a
destabilizing impact on the investment
climate, as John R Brodman, deputy
assistant secretary for international
energy policy at the US Department
of Energy, recently told a US Senate
Committee.
He cloaked his analysis in diplomacy,
saying the West African strife
“threatened the social and economic
development aspirations of the African
people and on our energy security.” It
is the second part of the sentence, “our
energy security”, which holds the key.
“Finding affordable and effective
ways to help these countries overcome
these barriers is one of the new
challenges to our energy security
aspirations,” said Brodman glibly.
Democratization and the development
of responsible governing institutions
are
“particularly important in reducing oilrelated
confl icts and promoting African
supply stability.”
“Accountability and transparency
are necessary to ensure that oil revenues
benefi t the population and support
economic and social development.
Managed effectively,” he said, “revenues
from expanding oil and gas production
could be the engine for national and
regional economic development and
political stability in West Africa.”
He’s absolutely right, of course.
But let us not think the US’s motives
are in any way altruistic. All the US is
interested in is that proverbial radio
station, WIIFM – What’s In It For
Me. The US has looked the other way
for years while African countries tear
themselves to pieces, but as soon as
there’s oil to be had, then the tune
changes.
Natural gas, in particular, is on the
US agenda, as its dependence on natural
gas rises steadily. US policy wonks
believe that much of this new demand
could be met by
shipments from Latin
America and Africa.
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