Natural Gas and Sustainable Development Goals Opportunities and Challenges for Africa Dr Sun Xiansheng Secretary General, IEF Riyadh
Contents • Current reality: Where we are today • Global energy trends and projections • Natur ural Gas Adva dvant ntage ges • Three Key Challenges
Fossil Fuel demand will range between 60% and 75% Natural gas shows strongest growing share among fossil fuels Global Primary Energy Fuel Shares and Outlook for 2040 Coal Oil Gas Nuclear Hydro Biomass Other renewables All other 2% 1% 5% 6% 7% 10% 10% 16% 9% 10% 10% 3% 2% 26% 3% 5% 5% 3% 3% 37% 5% 11% 6% 5% 0% 0% 0% 0% 4% 22% 22% 25% 9% 25% 0% 0% 0% 0% 25% 25% 26% 25% 32% 32% 29% 28% 28% 28% 23% 28% 28% 27% 25% 22% 22% 21% 12% 9% IEA OPEC IEA CPS IEA NPS IEA SDS OPEC REF OPEC SEN. OPEC SEN. B A 2016 (IEA) 2015 (OPEC) 2040 Sources: IEA WEO 2018, Annex Tables; OPEC WOO2018, Table 2.2 and 9.10 . .
Natural Gas Advantages For Africa Five key advantages for natural gas 1. Sustainability Sustainable Development of Natural Gas Natural gas will improve energy access in Africa • Enterprises (electrification rate) and facilitate orderly energy transitions. Sustainable Sustainable Utilization of Supply of Natural Gas Natural Gas Resources Resources Energy transition is a comprehensive strategy • Natural Gas Industry that should include both natural gas and Sustainability renewables. Natural gas releases up to 50 percent less • Sustainable Sustainable carbon than coal and 20-30 percent less than Promotion of Progress of Natural Gas Natural Gas oil. Policies Technologies Source: Uppsala University, China University Petroleum
Natural Gas Advantages for Africa Five key advantages for natural gas 2. Cost Competitiveness Henry Hub Natural Gas Spot Price Dollars per 9 Million Btu 8 A price of around $8/MMBtu can be • competitive with oil-fired power at an oil 7 price as low as $50/barrel. 6 5 Use of oil in power generation is one • 4 reason why electricity is expensive in many Sub-Saharan African countries. 3 2 1 0 Source: US Energy Information Administration
Natural Gas Advantages for Africa Five key advantages for natural gas 3. Resource Abundance Africa has 7 percent of global reserves • and sub-Saharan Africa is estimated to have 400 gigawatts of gas-generated power potential. Development of natural gas supply • ensures robust energy security and decreases dependence on foreign markets. Source: BP Energy Outlook 2019
Natural Gas Advantages for Africa Five key advantages for natural gas 4. Regional Integration Natural gas infrastructure (pipelines, LNG, • cross-border interconnections) between countries can enhance cooperation and transparency. Signing of African Continental Free Trade Area • (AfCFTA) has sown the seeds for pan-African collaboration and investment. Potential precursor to an Asian Gas Hub to • establish transparent and reliable market signals and liquidity.
Natural Gas Advantages for Africa Five key advantages for natural gas 5. Economic Opportunities Expanding Africa’s infrastructure for • natural gas would promote rapid industrialization. Availability of local natural gas supply can • spur investment in other industries such as agriculture and petrochemicals.
SDG’s are contingent on policy and technology dialogue and cooperation
3 Key Challenges for Africa 1. 1. Improving Energy Access 2. 2. Facilitating Energy Transition 3. 3. Increasing Cooperation and Dialogue
Key Dialogue Meetings 1. 1. The he 10t 10th I h IEA-IE IEF-OPEC S Sym ympos posium um on E on Ene nergy gy Out utlooks ooks on 18 on 18 Febr brua uary 2020 i y 2020 in n Riya yadh, S dh, Saudi udi Arabi bia 2. 2. The he 7t 7th I h IEF-IGU Mini nisterial Gas F For orum um on 20 on 20-21 S 21 Sept ptembe ber 2020 2020 in K n Kua uala Lum umpur pur, , Malays ysia 3. 5 th IE 3. IEA-IE IEF-OPEC Sym ympos posium um on G on Gas and nd Coa oal M Marke ket Out utlooks ooks Nove ovembe ber 2020 2020 4. 4. The 17th IEF Ministerial Meeting in Riyadh in 2020
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