Page 4 - AfrOil Week 23 2022

AfrOil COMMENTARY AfrOil

Can North Africa really make up

for Europe’s energy shortfall?

Africa has potential to serve as an alternative source of gas for Europe but also faces many

significant challenges, according to John Hamilton, the managing director of African Energy

NORTH Africa is as close to Europe as the west has had an ideological reluctance to work with
of Russia. Why, then, do many of Africa’s oil and international companies for a very long time.
WHAT: gas reserves remain untapped? Algeria has simply not faced the fact that it needs
Russia’s invasion of NewsBase’s partner service bna/IntelliNews help to explore, develop and produce its natural
Ukraine has given Europe asked John Hamilton, managing director of gas. That makes it very hard for international
a strong incentive to seek African Energy, a specialised news and data companies to operate there. The government’s
out alternative natural
gas suppliers. service, what it would take for Africa to meet decision-making processes are incredibly ineffi-
Europe’s energy needs. Edited excerpts from cient. The financial terms it offers are extremely
WHY: that interview follow: ungenerous. And so there is underinvestment.
Despite the advantage of bna: And yet Algeria has the 11th largest
geographical proximity Short-term prospects known gas reserves in the world?
to Europe, North Africa’s bna: What are the short-term prospects of Africa JH: Yeah, but you would have to go back into
ability to provide addi- scaling up natural gas production for Europe? the mists of time to find a licensing round that
tional volumes of gas in John Hamilton: It’s difficult to see how actually attracted serious interest from oil and
the short term is limited. Africa can do much, certainly by Christmas. gas companies of any description. I am not just
Countries in North Africa such as Algeria, talking about major oil companies; even inde-
WHAT NEXT: Libya and Egypt look good on paper because pendents are reluctant. But as Algeria has a lot
Egypt is the North African so much of the delivery infrastructure is already of gas delivery infrastructure everyone is now
state in the best position in place. There are natural gas pipelines that go asking: “Why can’t Algeria produce a bit more?”
to serve Europe’s needs from Algeria through Morocco into Spain and bna: Why can’t Algeria produce a bit more?
in the near term, and it another through Tunisia into Italy, plus Algeria JH: Because they don’t have the well infra-
may be delivering gas
from Israeli fields. has LNG (liquefied natural gas) export termi- structure; they don’t have an effective industry
nals. In Libya, there’s the gas pipeline Green- ready and waiting to drill. It would be great if in
Stream, which goes through Italy, and Egypt has the next six months, Algeria could tie in a whole
two big LNG export terminals. The good news load of gas fields to the existing gas export infra-
is that all of this is already connected to Europe. structure. But they are totally unprepared for
that. That’s simply because Algeria has been such
Algeria a difficult place for international companies to
bna: What is the bad news? make money, and that’s unlikely to change any
JH: Let’s start with Algeria. The regime there time soon.

Gas treatment plant for production from Egypt’s offshore Zohr field (Photo: Eni)

P4 www. NEWSBASE .com Week 23 08•June•2022