21 December 2017

Africa: World Bank Pulls the Rug From Under Oil and Gas Extraction

The World Bank has announced it will no longer be funding oil and gas projects from 2019 onwards.

Support for ongoing projects will not be affected. One of these in the region is the six-year Kenya Petroleum Technical Assistance Project signed in 2014.

In a press release issued at the UN Environment One Planet Summit in Paris, the World Bank outlined its commitment to supporting the development of renewable energy.

But in what appeared to be a concession to poor nations with gas deposits, the Bank said consideration will be given to financing upstream gas where there is a clear benefit in terms of energy access for the poor and the project fits within the countries' Paris Agreement commitments.

Renewable energy

World Bank president Dr Jim Yong Kim said renewable energy is becoming affordable, hence the need to shelve financial support for oil and gas projects.

Oil and gas have long been blamed by environmentalists for global pollution.

"The price of solar batteries has reduced so much that we do not need to involve ourselves in oil and gas exploration as well as extraction business any more. We want to get ahead and support renewable energy and do not wish to be left behind," said Dr Kim.

He affirmed the commitment to meet its target of using up to 28 per cent of funds for its Climate Change Action Plan, developed following the Paris Agreement, which came into force on November 4, 2016.

The World Bank Group will present a progress report of its Climate Change Action Plan and announce new commitments and targets beyond 2020 at the 24th session of the Conference of the Parties to the UN Framework Convention for Climate Change scheduled for December 3 to 14, 2018, in Poland.

Additionally, the Bretton-Woods institution has announced the incorporation of climate accountability in its operations from 2018 through reporting of greenhouse gas emissions and carbon analysis of all the projects it is funding.

Experts say trillions of dollars must be invested in clean energy technology to meet the Paris Agreement's goal of limiting average global warming to 2C over pre-Industrial Revolution levels.

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