The European Union’s Landmark Proposal to Label Natural Gas as ‘Green’ Energy is Good for Africa and our Energy Industry.

Africa’s call for a just and inclusive energy transition has been answered through the European Union’s landmark proposal to label natural gas as a ‘green’ energy source. Historically, Africa has always fought for sustainable development because we know, first-hand, the ravaging effects that even minute changes in climate can have on the continent and its populations. But to develop sustainably, Africa must first industrialize itself. It must have the same opportunities as Europe and other western countries. The point that natural gas serves as a transitional energy source is one that has been promoted by African nations for a long time and therefore, the African Energy Chamber (www.EnergyChamber.org) hails the EU’s proposal as a landmark development that justifies a positive outlook for an inclusive energy transition.

It has taken a crisis in energy availability to bring about policies that could increase Africa’s energy supply. The current pressure from The West to acclimatize to cleaner energy systems has so far been exclusive in recognizing that the transition may differ in form and timing from one region to another. By restricting investment into energy sources, such as gas, Africa has stood the chance of being left behind during the energy transition, which is counterproductive and regressive.

“We have had our disagreements with our European friends, however, there has always been constructive, behind-the-scenes dialogue with European policy makers. They listened, worked, and let us make the case for Africa’s low-carbon LNG and these discussions have been critical in getting us to see eye-to-eye on gas, a lot of work still needs to be done to make this a reality” stated NJ Ayuk, Executive Chairman of the African Energy Chamber, who added, “The demonization of Africa’s gas industry needs to stop, and investments need to come into the sector. While we continue this engagement, it is important that the oil and gas industry focuses its investment on further reducing carbon emissions within the gas value chain. Sustainable development and making energy poverty history will require Africa to increase gas within its energy mix, which will give us a fighting chance to reduce the continent’s carbon footprint, even when we are still under 4% of global emissions.”

Africa faces unique challenges and must be allowed to time its own energy transition according to its own needs. The proposal to label natural gas as ‘green’ energy is what a just energy transition looks like, and now, we need to finance it. To capitalize on this, the African Green Energy Summit, to be held at African Energy Week this year, will clearly outline initiatives and positions ahead of this year’s COP27.
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​Now, at the dawn of a new year, Europe and Africa can collaborate and cooperate and stride in allegiance towards a brighter future. The two continents can set aside their differences and strive towards sustainable development together, paving the way for a new approach to Africa’s energy industry, one that serves the whole world and all its people as opposed to a privileged few. Should most EU members back the proposal, then it will become law from 2023, which the African Energy Chamber hopes will stand to help the U.S. recognize natural gas as a clean fuel, which it unfortunately does not under the Biden Administration’s current clean power plans.

This new proposal will pave the way for new European investments in natural gas in Africa and will therefore allow Europe to unlock billions of euros in finance and sustainable energy funds to support gas as a transitional energy source. The EU will want to import whatever natural gas Africa develops, which is constructive for project funding and will open doors to have candid discussions about furthering energy availability across the continent.

Some countries, like Senegal, Mozambique, South Africa, Tanzania, Nigeria, Angola, Ghana, Mauritania, Libya, Cameroon, Algeria, and Equatorial Guinea, have taken steps to monetize their natural resources to develop and industrialize independently. Thus, we need to give them time to realize the benefits of their strategic efforts and facilitate their own sovereignty when adhering to the energy transition. By using natural gas as a feedstock to create other value-added products, like petrochemicals, from fertilizers to ammonia, revenue can be used to build infrastructure, from pipelines to ports and roadways, and we can therefore open the doors to economic diversification for other African countries as well.

“Despite predictions that demand for African LNG is expected to grow for the foreseeable future, investments in gas exploration have been hit hard by a short-sighted bias against our low-carbon natural gas resources. This has led to a reluctance towards investing in supply projects because of the fractured global outlook towards natural gas,” continued Ayuk, concluding that, “African nations must be more pragmatic. If exploration and production companies must wait one or two years before their proposed projects are sanctioned, then the prospects for a sustainable African energy future will diminish rapidly. These practices, which help protect the interests of oil-producing nations, made sense when crude sold for $100 per barrel and before the energy transition took center stage, but they don’t make sense now.” Concluded Ayuk

While the African Energy Chamber hails the proposal as a win for Africa, it is not a time to regress to the continent’s old ways. Now is the time for African oil and gas producers to do everything in their power to encourage as much exploration and production activity as possible, particularly through International Oil Companies, National Oil Companies and African Independents. In the long term, African producers of oil and gas will continue to rely on the industry’s revenue to sustain economic growth and guarantee a just and inclusive energy transition, and should lobby for knowledge transfers, training, gas monetization programs, and other strategic opportunities so that their oil and gas operations can create pathways towards sustainable development and diversification.
Distributed by APO Group on behalf of African Energy Chamber.
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African Energy Chamber

When talking about climate change, not all fossil fuels are created equal. Burning natural gas, for instance, produces nearly half as much carbon dioxide per unit of energy compared with coal. Natural gas is thus considered by many to be a “bridge fuel” that can help nations lower carbon emissions while they transition more slowly from fossil fuels to renewable, carbon-neutral forms of energy. The recent boom in natural gas production in the United States, for instance, contributed to a 3.8 percent drop in carbon emissions in 2012.

But natural gas has a climate downside—it’s mostly composed of methane. “Methane is a potent greenhouse gas,” said energy researcher Adam Brandt of Stanford University. The gas is about 30 times better at holding in the atmosphere’s heat compared with carbon dioxide. So if enough methane leaks during production, natural gas’s slim advantage over other fuels could be wiped out.
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A report published today in Science, however, concludes that the United States’ leaky natural gas production system currently isn’t leaking enough methane to make it worse fuel for the climate than coal.

The natural gas production system is not sealed tight. There are some areas where methane is allowed to leak intentionally for purposes of safety, but there’s also a lot of leaky valves and cracked pipes out there that can let the gas out. Quantifying all those leaks, though, has proven tricky.

The Environmental Protection Agency provides estimates of methane emitted in the United States. To calculate these estimates, someone has to go to a facility and take direct measurements from various equipment and devices. Those measurements are added up to get a total for the facility. And the facilities where the measurements are taken will serve as the basis for calculations of methane emissions for a type of source or a region.

These official estimates, however, probably underestimate total methane leaked because the devices that are sampled to provide those estimates aren't necessarily representative of all of the devices used by the natural gas industry to produce and move its product. In addition, sampling is expensive and limited. It also only takes place at locations where facilities let the EPA in—those facilities may be different from the average facility, leading to sampling bias.
Studies that have directly measured methane levels have gotten much different results. Atmospheric tests that have covered the entire United States come up with methane emissions that are about 50 percent higher than the EPA estimates, according the new paper in Science. Partly that’s because air sampling will pick up both anthropogenic methane and methane from natural sources, such as wetlands. But it’s also because the EPA’s methods are so inaccurate—natural sources only account for a fraction of the discrepancy.

The air sampling studies, though, have found some odd peaks in regional methane emissions, causing scientists to worry that there could be a lot more methane leaking from sites of natural gas production than thought. So Brandt and his colleagues began tallying up all the places where natural gas production could be leaking methane along with other sources of methane that could be mistaken for natural gas emissions.

The large natural gas leaks suggested in regional studies “are unlikely to be representative of the entire [natural gas] industry,” they write. If there were natural gas leaks of that magnitude across the natural gas industry, then methane levels in the atmosphere would be much higher that surveyed in the air sampling studies. “Most devices do not leak,” Brandt noted. Only about 1 to 2 percent of the devices used in natural gas production leak any methane, and large emitters—what the researchers nickname “superemitters”—are even rarer.

Brandt and his team then took a look at all the excess methane being released into the atmosphere. For their calculations, they assumed all that methane was coming from the natural gas industry. That’s unlikely, they note, but it makes for a good worst-case scenario. But even that level of methane wasn’t enough to make natural gas a bigger greenhouse gas contributor than coal, the researchers found. And switching from coal to natural gas for energy production does reduce the total greenhouse effect on a scale of 100 years, the standard scientists use in calculations like these.

“We believe the leakage rates are likely higher than official estimates, but they are unlikely to be high enough to disfavor shifting from coal to natural gas,” Brandt said.

Natural gas has also been promoted as a cleaner fuel than diesel, and it’s replaced that fuel in many trucks and buses on city streets. But the climate benefits of such a switch are not as clear as the switch from coal to natural gas.

Taking into account methane leaks from extraction all the way down the pipeline to the pump may actually make natural gas less climate friendly than diesel. But it’s probably not time to abandon the natural gas bus. “There’s all sorts of reasons we might want to [replace] diesel buses,” Brandt says. For example, burning natural gas results in less air pollution and less reliance on imported petroleum.

For natural gas to assert itself as a more environmentally friendly fuel, though, the industry is going to have to plug up its leaky system. Companies may find it worth their while to do so, and not simply for the climate benefits. Less leakage equals more profit, and plugging just a few of the biggest leaks could easily increase income, Brandt says. “If we can develop ways to quickly and cheaply find these sources, it’s going to be very profitable for companies.”

Sarah Zielinski is an award-winning science writer and editor. She is a contributing writer in science for Smithsonian.com and blogs at Wild Things, which appears on Science News.

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State-owned energy companies from South Africa and Mozambique have exercised their rights to buy the 30% stake in the Rompco natural gas pipeline that Sasol is selling, the companies said.

Petrochemical firm Sasol said last month it was selling the stake in the Rompco pipeline from Mozambique to South Africa to a consortium of investors including Reatile Group for an initial amount of R4.15bn.

But that deal was subject to pre-emptive rights on the shares held by existing shareholders iGas, a subsidiary of South Africa’s Central Energy Fund, and Companhia Moçambicana de Gasoduto (CMG), a subsidiary of Mozambique’s Empresa Nacional de Hidrocarbonetos.

iGas and CMG will now increase their stakes in Rompco to 40% each from their current level of 25%. Sasol, which is trying to shed assets to pay off debt, will reduce its shareholding from 50% to 20%.

The transaction will be fully funded from past and future dividends generated by the 865-kilometre pipeline, the Central Energy Fund and Empresa Nacional de Hidrocarbonetos (ENH) said in a joint statement.

“Having both governments as majority shareholders of the cross-border pipeline is strategic, since the pipeline is the single source of gas to the South African market,” ENH chief executive Estêvão Pale said.

Sasol said in a statement: “We can confirm that Sasol has received pre-emptive rights notices and will now review the notices. We believe that the successful partners will add significant value to this important regional energy asset.”

​Emerging domestic natural gas and helium producer Renergen’s subsidiary, Tetra4, has secured an agreement with Bulk Hauliers International Transport (BHIT) for the supply of liquefied natural gas (LNG) from the Virginia gas project, in the Free State.

The LNG will be used to fuel about 50 of BHIT’s trucks, meaning that operator costs and the vehicle lifecycle maintenance costs will be significantly reduced.

Renergen CEO Stefano Marani says Tetra4 “is proud to be associated with BHIT as they embark on their new venture to disrupt the local logistics market using cutting-edge technology and international best practice”.

BHIT director James Cohen adds that BHIT is committed to providing “sustainable transport solutions” and that running its trucks on locally produced LNG “fits in perfectly” with this goal.

BHIT operates a premium fleet of truck-tractor combinations, with a focus on the transportation of general freight and dangerous goods throughout Southern Africa.

Tetra4 holds the first, and currently only, onshore petroleum production licence issued by the Department of Mineral Resources and Energy through the Petroleum Agency of South Africa. 

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A black-empowered consortium that includes companies with extensive gas-to-power experience has made a formal submission to the Department of Mineral Resources and Energy (DMRE) in which plans for power generation plants capable of adding between 300 MW and 3 300 MW to South Africa’s grid within 12 to 36 months are outlined.

The offer has been made in response to a request for information (RFI) released by the DMRE in December in an effort to inform an upcoming ‘Risk Mitigation Power Purchase Programme’, which will seek to address an immediate supply deficit of 3 000 MW with solutions that can be “grid connected in the shortest time at the least possible cost”.

The closing date for the RFI was January 31 and the DMRE has given itself a month to evaluate the proposals and design a procurement process.

Engineering News has not yet been able to confirm the number of submissions made ahead of the RFI deadline, nor what solutions have been proposed. It is understood, however, that the DMRE received a strong response, with hundreds of potential bidders having descended on the Centurion headquarters of the Independent Power Producer Office at the end of January to hand-deliver their proposals.

​One of the responses seen by Engineering News is an offer made by a consortium named Mhlathuze Energy, which derives it identity from the Zulu name for the river that meanders through Richards Bay, in KwaZulu-Natal – the proposed location for its project.

The consortium includes black economic empowerment company Phinda Power (a member of the Newlyn Group), Japanese multinational Marubeni and liquefied natural gas and gas-to-power specialist Golar Power.

Mhlathuze Energy’s proposal provides for the rapid deployment in Richards Bay of 300 MW (up to a maximum of 1 200 MW) of emergency power generation capacity that could be operational within 12 months of financial close.

The solution would involve the deployment of General Electric- (GE-) supplied mobile aeroderivative gas turbines. The solution would require the importation of liquefied natural gas (LNG) supplied through a floating storage regasification unit (FSRU) and the construction of the LNG marine import infrastructure.

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Anadarko Petroleum approved a $25-billion liquefied natural gas (LNG) project in Mozambique that could help transform the economy of one of the world’s poorest countries.

CEO Al Walker signed off on what he called the biggest ever foreign investment in Africa. Anadarko sees potential for Mozambique to become one of the largest LNG suppliers in the world, and the project – expected to export the fuel to countries in Asia and Europe – will play a big part. It will be funded with $11-billion of equity and $14-billion of debt.

“Over time this project will double this country’s GDP,” Walker said at the signing ceremony in Maputo with Mozambique President Filipe Nyusi.

It’s taken the American company almost a decade to green-light the development after discovering gas in Mozambican waters in 2010. The country had to draft new regulations for its nascent oil and gas industry, even as uncertain global demand for LNG slowed plans. The government expects $95-billion of revenue over 25 years from this project and others led by Exxon Mobil and Eni.

“It is the start of a new era for Mozambique,” said Darias Jonker, a London-based director at consultants Eurasia Group. The size of these projects “will bring tens of billions of dollars of investment” and revenue to the government, he said.

Developing the hydrocarbon resources is crucial for the southern African nation, which has struggled to service its debt in the past. Nyusi could use Anadarko’s planned investment in the project, called Mozambique LNG, to showcase his achievements ahead of elections in October, and hope to compensate for problems with borrowings, according to Jonker.

Mozambique LNG is at the center of a new restructuring deal the government reached with a core group of Eurobond holders last month. While investors will no longer have access to future revenue from the project, the in-principle agreement allows the administration to pay a lower interest rate until after the country’s gas production begins in 2023

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Energy solutions company Novo Energy on Friday launched a R130-million large-scale natural gas compression facility at the Highveld industrial park, in eMalahleni, Mpumalanga.

The facility provides cleaner, and more reliable and cost-effective energy, compared with coal and other petroleum products.

At the launch, CEO Andri Hugo said the facility would play a significant role in helping to unlock South Africa’s power constraints, while also reducing carbon intensity.

“South Africa is a coal-based economy with about 77% of electricity generated from coal and a large portion of transportation fuels derived from the same source. Add to that the large percentage of industrial processes that use coal and you have an entire industrial sector built around cheap coal and electricity.

“But we depend heavily on imported resources for our hydrocarbon supply and this has resulted in exposure to international energy supply uncertainty, issues of reliability and price volatility,” he pointed out.

He added that although South Africa’s gas market is small, accounting for only 3% of the energy mix, the inherent benefits have the potential to change the economy by stimulating economic growth, development stability and job creation.

“Africa has been blessed with an abundance of resources, including minerals, energy, natural resources and human capital. A combination of these, through industrial activity, can address most of the socioeconomic challenges we face.

“Natural gas will play an important role in our energy mix through power generation, thermo-industrial applications and transportation and the vast natural gas discoveries on the continent will provide the key to unlocking our gas economies,” Hugo further pointed out.

Novo business development manager Justin Austin, meanwhile, said natural gas was the simplest hydrocarbon available, making it suitable as a feedstock for fertilisers, plastics and energy applications.

Natural gas can also be used as a heating fuel for industrial, commercial and residential applications, steam generation and direct heating applications, natural gas-run vehicles and power generation, he pointed out.

The eMalahleni gas compression station is Novo’s thirteenth – and its largest – such facility.

Austin said the most important application for natural gas going forward would be for power generation in remote locations, especially for remote mines that do not have grid accessibility and are using diesel as an energy source.

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Since the initial introduction of natural gas vehicles (NGV) in South Africa, natural gas supplier CNG Holdings has successfully converted about 180 dual-fuel compressed natural gas- (CNG-) run buses for the City of Johannesburg (CoJ).
This makes Johannesburg one of the first cities in sub-Saharan Africa to run a fleet of CNG converted buses.

Johannesburg municipal bus operator Metrobus is leading the conversion charts in the public buses sector, having converted from diesel engines, as well as procured already gas-modified buses.

Metrobus runs on its converted diesel dual fuel (DDF) system whereby the engine runs on gas and diesel – both of which are injected into the cylinder at an electronically controlled ratio, to ensure best performance. These buses have been successfully operating since 2016 and are fuelled at CoJ’s own in-house filling station at the Braamfontein depot.

Metrobus covers 330 scheduled routes and 128 school routes, transporting thousands of passengers on a daily basis, which means that these buses consume a great amount of fuel daily.

CNG Holdings Group sales and marketing manager Wayne Williams notes the continuous increases in petrol prices have created a lot of uncertainty for the populace who rely on public transportation. However, the availability of natural gas as an alternative fuel source has relieved a significant amount of financial burden for a lot of public transport service providers and their committed commuters.

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​Therefore, he adds that CNG has been the ideal choice for high mileage vehicles such as buses.

“South Africa, however, has been in the back-end of the global revolution to find a cleaner, environmentally friendlier, and mostly, a more economical source of fuel in the public transport sector,” he points out.

CNG Holdings, through its natural gas distribution division NGV Gas, on realising the gap in the industry, has converted more than 1 200 taxis and an additional 300 fleet vehicles in Johannesburg to run on CNG. Also, CoJ has been involved on the conversion of over 100 utility vehicles used in the district.

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Energy Minister Jeff Radebe has promised greater alignment between South Africa’s energy plans, including the new Integrated Resource Plan (IRP) for electricity, with a regional gas master plan, which is currently under development within the 16-country Southern African Development Community (SADC) bloc.

In an interview with Engineering News Online on the sidelines of a SADC Ministerial Workshop on regional gas infrastructure and market development in Johannesburg, Radebe said it was crucial for South Africa’s national plans to be reflected in the regional plan.

The expanded integration of natural gas into Southern Africa’s energy mix, as well as its industrial and petrochemicals sectors was strongly endorsed at the thirty-seventh summit of the SADC Heads of State and government, which took place in South Africa in August last year. By the next summit, which is scheduled for Windhoek, Namibia, this August, a report must be produced outlining SADC’s approach to the development of regional gas resources.

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​The pursuit of piped gas into South Africa from Mozambique could unlock South Africa’s gas economy, says investment and projectdevelopment company Fortune Capital.
Referring to the African Renaissance Project (ARP), Fortune Capital CEO Nhlanhla Magubane explains that the project is a 2 600 km cross-border terrestrial gas pipeline project, which will transport gas from the offshore and onshore basins to all Mozambique’s major cities, special economic zones and South Africa at a capital cost of $7-billion.

“The indispensable essence of this project is that it provides the potential for South Africa to have energy security, economic growth and development, as well as environmental sustainability. Currently, the project is in an exploratory phase and we are involved in project planning,” he says.
Magubane adds that Fortune Capital’s focus is mainly to ensure that the gas gets to South Africa so that it can stimulate the independent power producer (IPP) market, and the domestic and industrial markets.
“This project will be a game changer for the region, stimulating industrial growth, providing clean and affordable energy, and reducing carbon emissions.”
The prefeasibility study was finalised in February and the findings were positive and determined that the project is fundable, says Magubane. He notes that the final feasibility study started mid-year and will point the project towards the start of construction in about a year’s time.

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