Page 5 - AfrOil Week 31 2022

AfrOil COMMENTARY AfrOil

Further complicating matters, timing is a fac- play a role in satisfying the world’s already tre-
tor too, and the clock is ticking. Mauritania, mendous and growing need for energy —natu-
for example, needs to find a substitute for its ral gas especially. Large-scale expenditures like
iron mining business, which has provided for these are in the best interest of IOCs, and Sene-
a sizeable portion of the national economy but gal and Mauritania extend a degree of co-opera-
is subject to the ebb and flow of demand from tion not found elsewhere in the world.
key customer China. A decrease in the market
paired with an expected drop in the trading Promising steps
price would substantially impact the nation. Mauritanian leadership has been proactively
The fiscal gap could be filled with proceeds from attracting international investment by relaxing
LNG produced from Mauritania’s fields but only restrictive business regulations, developing a
if production can come onboard fast enough to gas master plan and designating the port city
satisfy Europe’s growing LNG needs, which are of Nouadhibou as a gas processing, import and
expected to peak in the mid-2030s. export hub.
The problem is that neither Mauritania In addition to establishing offshore explora-
nor Senegal has the means to bring offshore tory relationships with BP, Kosmos Energy and
gas to domestic markets or to export LNG to Mauritania’s own national oil company (NOC),
international markets. Onshore gas-to-power Société Mauritanienne des Hydrocarbures et de
infrastructure is minimal at best. Successfully Patrimoine Minier (SMHPM), the nation also
monetising this region’s resources is an objec- seeks to develop onshore refineries in the effort
tive requiring proportionate attention paid to to combat energy poverty on a grand scale.
addressing these inadequacies. President Macky Sall has pushed and exe-
cuted a plan to improve the country’s interna-
A prescription for success tional appeal. Outlined in 2014, the Plan for an
As detailed in the African Energy Chamber’s Emerging Senegal (PES) allocates billions to
“Petroleum Laws: Benchmarking Report for industrial infrastructure across the nation.
Senegal and Mauritania,” opportunities exist for Construction of a deepwater port in the capi-
collaboration between local governments and tal city of Dakar began earlier this year, as did the
international oil companies (IOCs) that would construction of Ourossogui-Matam Airport in
accelerate the development of these offshore the northeast. Improvement projects at airports
reserves. in Kedougou, Tambacounda and Ziguinchor
Although it’s possible that someday Mauri- have also commenced.
tania could connect with one of Algeria’s three As of last year, high-speed, regional express
pipelines to Europe, floating LNG (FLNG) rail travel is available in Senegal, and an expan-
vessels offer a more immediate and affordable sion of the Dakar-Diamniadio-AIBD Toll High-
solution. way is currently underway. Additionally, Dakar
International pipelines, an unrivaled method will host the MSGBC Oil, Gas & Power confer-
of fuel delivery when completed, are accompa- ence and exhibition on September 1-2 this year, Senegal and
nied by their own unique, time-consuming where industry leaders will present the case for
difficulties during the planning stage. Any further international investment in Senegal and Mauritania stand
pipeline project must consider the potential the region on the world stage. uniquely poised
for community displacement while simultane-
ously contending with the geological features Reinvestment key to sustainability to satisfy their
and vegetation management issues. The risk of The African Energy Chamber is invigorated by
security concerns is another factor. While Sen- the notable and ongoing progress in the MSGBC national energy
egal and Mauritania have not struggled with Basin. We regard success in the region as a cer-
security issues, it is possible that instability in tainty, but only with monetisation and reinvest- needs while also
other countries in the region, such as the Islamic ment in infrastructure will that success prove satisfying those
insurgency in neighboring Mali, could spread long-lived.
and pose a threat to land-based infrastructure. We encourage the governments of Senegal of Europe and
FLNG vessels like those offered by Golar, New and Mauritania to remain vigilant concerning
Fortress Energy and Technip offer a reasonable the monetisation of their reserves. Each step of beyond
way to negate most of these hindrances. the gas value chain should generate revenue, and
a portion of that revenue should further finance
A time to act infrastructure development at home.
Despite these time-sensitive challenges, Senegal The worldwide demand for natural gas is
and Mauritania offer international oil compa- already strong, and that demand increases with
nies (IOCs) an undoubtedly lucrative oppor- the passing of each season. Senegal and Mau-
tunity deserving of investment. If the recent ritania stand uniquely poised to satisfy their
volatility in the European energy market is a national energy needs while satisfying those of
forecast of coming circumstances, now is the Europe and beyond. Decisive action now paired
time for international operators to establish with long-term, committed partnerships will
solid relationships in Africa. guarantee the achievement of this objective.
Ideally, IOCs should erect infrastructure that
supports every facet of African gas and oil pro- Ayuk is the executive chairman of the African
duction. LNG export terminals, maritime logis- Energy Chamber (AEC). Article reprinted cour-
tics operations and pipeline networks would all tesy of AEC. ™

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