Boycotting the companies that can help African countries develop economically would be paramount to economic suicide.
Nobel Peace Award winners like Archbishop Desmond Tutu may advocate that an Apartheid-style boycott on coal, oil, and gas companies will help stop climate change, but NJ Ayuk has a different perspective. Rather than blaming and demonizing the use of hydrocarbon resources for the economic development of Africa, he builds a constructive way forward on energy transition. Environmental sustainability is part of it.
Oil and gas companies are equally focused on profit and sustainability.
“Oil and gas companies are not autocratic regimes focused on oppressing the people and steal their resources. They are businesses, which, yes, are focused on profit, but they are also focused on the sustainability of the business itself. In practical terms, it means that these companies adapt to the needs of the economies they’re part of. Boycotting oil and gas companies will not have an impact on carbon emissions, but it might raise the price of fuel in the long run. That is not the goal intended,” explains Auk.
In his bestselling book, Billions At Play: The Future of African Energy and Doing Deals, NJ Ayuk makes a case in point by showing how oil and gas companies are shifting into becoming “energy companies.” The big players in the industry are rebranding—Statoil became Equinor and diversify their portfolios to include renewable energy assets.
With an infrastructure already in place and funds to invest in research and development of new renewable resources technologies, the big players in the oil and gas industry are better funded and placed to drive the energy transition that Africa and other countries seek. Also, bringing energy companies, governments, and civil society groups together to find functional solutions will achieve much more.
Ayuk says, “While the concerted effort amongst all of the world’s nations is fundamental to curb the effects of climate change, it is paramount to have a clear understanding of what efforts will be most decisive, and which regions of the world are in a better position and have the biggest responsibility to tackle these issues. Europe, North America, and China are by large responsible for much of the CO2 emissions that are behind the changes in our climate, have to live up to that responsibility, and move towards more sustainable practices.”
Africa needs to drill
According to Carbon brief, the African nations put together have polluted seven times less than China, thirteen times less than the United States, and eighteen times less than Europe since the beginning of the industrial revolution. While a few nations across the continent have been producing hydrocarbons for decades, these resources have mostly
fueled industrial development in Europe, the US, and Asia. The European colonial legacy and the lack of existing financial resources and expertise to develop local economies over the last century are two of the main reasons for it.
Nearly half of all Africans still don’t have access to electricity, and almost every company in the continent struggles with the lack of power reliability, which harms the operational costs, productivity rate, and performance on the international markets.
The African Development Bank has estimated that between USD$130 and USD$170 billion a year in the run up to 2025 would be needed to close the infrastructure gap across the continent. In his book, Billions At Play: The Future of African Energy and Doing Deals, NJ Ayuk explains how cooperation amongst the African nations and leveraging the continent’s abundant gas resources can help to raise these funds.
“Today, natural gas is by far the most economically sustainable way of producing power in enough quantities to fuel economic development. Petrochemical plants represent a massive economic opportunity to produce byproducts from oil and gas with a higher value within the supply chain, an opportunity to create jobs, develop infrastructure, and produce wealth. Refineries, too, have a positive impact on curbing the need for fuel imports. All of these are fundamental pieces of the puzzle that will foster Africa’s economic growth and promote the betterment of the lives of its people,” says the Executive Chairman of the African Energy Chamber.
Economic growth and environmental sustainability are critical.
Africa’s time to grow and develop is finally here, and its natural resources can help fund it. Even if Africa wanted to stop using fossil fuels and shifted every power station to renewable sources, it would still be forced to develop its oil and gas fields to fund that transition.
NJ Ayuk believes there is no point in promoting radical approaches to the energy transition, particularly for Africa. On the contrary, a balanced manageable and well-lead approach of progressive transitioning combining hydrocarbons and renewable energy development alongside strong environmental protection policies in the sector will allow combining economic growth and environmental sustainability.
NJ Ayuk is a bestselling author and a leading authority in the African energy sector. He is also the Executive Chairman of the African Energy Chamber and CEO of Centurion Law Group.