Constance Ikokwu
26 November 2008
Washington, DC — Nigeria and Angola will be the highest earning oil-producing countries in a pack of 10 within the sub-saharan African region between 2006 and 2030, says the International Energy Agency (IEA).
In a report entitled "World Energy Outlook 2008", presented at the Center for Strategic Studies (CSIS) in Washington, D.C. by the organisation's Chief Economist, Dr Faith Birol, Nigeria and Angola will account for 86 per cent of the $4.1 trillion cumulative revenues of all 10 countries over 2006-2030.
The top ten oil-producing countries will see an increase in commodity revenue rising from $80 billion in 2006 to about $250 billion in 2030, says the Agency.
"In the 'Reference scenario' (in which no change in government policies is assumed), their oil exports rise from 5.1 mb/d in aggregate in 2007 to 6.6 mb/d in 2030. Gas exports, largely as liquefied natural gas (LNG) increase from 21.6 bcm in 2006 to 130 bcm in 2030.
"These projections hinge on a reduction in gas flaring, adequate investment and avoidance of disruption supplies through civil unrest," it states.
The report notes the 10 countries flared 40 bcm in 2005, almost three times the entire region's gas consumption. A positive policy would be to use currently flared gas for power generation or distribution in cities, it advised. According to the study, Liquefied Petroleum Gas (LPG) extracted from natural gas or produced in refineries can provide low cost source of supply for distribution networks.
These countries will also need an estimated $18 billion to achieve universal access to electricity and LPG cooking stoves and cylinders, a mere 0.4 per cent of the projected cumulative government revenues from oil and gas export revenues between 2007 and 2030.
The report says increased revenue provides these countries the means to alleviate poverty and expand energy access, a huge problem currently faced by its citizens. It will however, require reforms, the report adds.
"In most of the countries, improving energy access will entail fundamental political, institutional and legislative reform, as well as efforts to strengthen the capability of regional and local authorities to implement programmes and to expand access to credit," says the report.
Less than a third of households in the majority of oil and gas-rich countries have access to electricity or clean fuels for cooking, inlcuding LPG, kerosene, biogas and ethanol gelfuel, the study notes. It finds that about 150,000 people die prematurely each year because of indoor air pollution from burning traditional fuels - feulwood, charchoal and from inefficient stoves and open fires.
If there are no new government policy within the period, the number of people living without electricity and relying on charcoal for cooking is set to rise, the study finds.
"Sub-saharan Africa's hydrocarbon-resource wealth will lead to economic development only if governments manage wisely and honestly the development of the sector and revenues that accrue," the report concludes.
On a global level, world oil production is expected to rise from 82 mb/d in 2007 to 104 mb/d in 2030 in the Reference Scenario. Most of the increase in world output, the study says, is expected to come from the Organisation of Petroleum Exporting Countries (OPEC). Their collective share will rise from 44 per cent in 2007 to 51 per cent in 2030. Demand for oil will rise from 85 mb/d now to 106 mb/d in 2030.
Saudi Arabia remains the world's largest producer throughout the projection period, with its output climbing from 10.2 mb/d in 2007 to 15.6 mb/d in 2030, notes the study. China and India account for over half of the energy demand to 2030 followed by the Middle East.
According to Birol, more than 40 per cent demand will come from China, 20 per cent from India and 20 per cent from the Middle East. With regard to climate change, he says the largest pollution within the period will come from China, the United States (US) and India.
This situation is not "sustainable" notes Birol. He called for a global energy revolution, urging government to make policy changes to tackle climate change including the provision of alternative energy sources.
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