Poor infrastructure, smuggling, funding gap crippling Africa’s petroleum downstream
16 March 2021 |
3:03 am
With a growing population, huge energy demand, and projected industrial and agricultural boom, cross-border infrastructural deficits, funding gaps, smuggling, and lack of harmonized taxes
Petroleum Industry Bill
Stakeholders seek options for maximising AfCFTA
With a growing population, huge energy demand and projected industrial and agricultural boom, cross-border infrastructural deficits, funding gaps, smuggling, and lack of harmonized taxes are critical bottlenecks limiting the growth of Africa’s downstream petroleum, stakeholders have said.
Except the price differential challenge is addressed, energy experts have insisted that the gains of the African Continental Free Trade Area (AfCFTA) in the downstream sector of the continent’s petroleum industry may remain a mirage.
The experts, who gathered at the Ghana International Petroleum Conference stressed that challenges bedeviling local capacity and distribution of petroleum products across the continent may mar the gains of AfCFTA.
AfCFTA, which came into force earlier this year, was created by the African Continental Free Trade Agreement among 54 of the 55 members of the African Union. Despite the projected benefits of the initiative, Africa’s limited refining capacity, lack of transport network linking the countries, ambiguous trading models, small ports and bottlenecks across borders as well as ports could limit the projections as they applied to the petroleum sector.
Nigerian-born energy expert and the Executive Secretary of the African Refiners and Distributors Association (ARDA), Anibor Kragha, noted that although Africa’s rapidly growing population and huge energy resources have enormous opportunities, continuous importation of petroleum products, if not checked, would create energy security challenges.
The need for harmonisation of regulations on cleaner fuel to ensure that petroleum products produced in the continent conform to a continent-wide specification according to him remained sacrosanct, otherwise, public health burden may ravage the continent.
“We have had to import petroleum products over the last couple of years. With what we have seen with COVID-19 and the disruptions that are potentially possible to trade across the continent, we need to become more self-sufficient,” he said.
Kragha disclosed that ARDA and the African Union are working on harmonising regulations to ensure that petroleum products imported and refined on the continent meet AFRI Clean Fuel Specifications.
The Cleaner Fuel spec recommends the adoption of AFRI five (50 ppm sulphur for gasoline and diesel) by 2025, and AFRI 6 spec (10 ppm for same products) by 2030.
The Managing Director, CITAC Africa, Gary Still, said Africa must focus on how to simplify the supply chain within the continent, stressing that it is cheaper to move containers across the Atlantic to the west coast of Africa than it is to move the same container from the coast to the Sahara.
“So, policies that are needed should create efficiencies in the supply chain and remove those barriers to get greater access to cheaper energy because energy is a driver of economic growth and GDP, which is the solution to creating wealth and trade in Africa.
“We have already seen moves in this direction; places like Mozambique, Mozambique Maputo corridors are in operation and are still being developed…
“There is a corridor, which is also being developed to move products across the Kalahari into places like Botswana Gaborone and further going up north towards Dola Copperbelt in Zambia and into DRC. But this needs to become common practice,” Still said.
Related
1 day ago
Publisher, The Guardian Newspapers Ltd, Lady Maiden Alex-Ibru, has called on the government at all levels in the country to remove obstacles besetting the paper industry, to prevent it from total collapse.
1 day ago
Nigeria’s economy is projected to grow to 3.3 per cent this year, while it may recede to 3.0 per cent in 2025. In its latest World Economic Outlook report, ‘Steady but slow: Resilience amid divergence,’ the International Monetary Fund...
1 day ago
The newly elected executives of the Women’s International Shipping and Trading Association (WISTA) Nigeria have been charged to ensure the attainment of major structural adjustments in the nation’s shipping industry as well as create opportunities..
1 day ago
Some 12,948 startups have so far been registered through the Nigeria Startup Act. The National Information Technology Development Agency (NITDA), which disclosed this, said they were registered for labeling.
1 day ago
Apparently to sanitise the general aviation segment of local aviation, the Civil Aviation Authority (CAA) Nigeria, yesterday, ordered a three-day ultimatum for all private operators and holders of non-commercial flight permits to submit for a re-evaluation.
1 day ago
The Nigeria Employers' Consultation Association of Nigeria (NECA) has called on policymakers to adopt a holistic approach to address inflationary pressures and promote economic stability.
1 day ago
Afriland Properties Plc has urged the Federal Government to intervene in the housing sector and ensure that people borrow for mortgage properties at a reduced rate over a long period of time to bridge nation's huge housing deficit.
1 day ago
As we approach the midpoint of the third decade of the 21st century, the global economic landscape is poised for a profound shift, with Africa at its heart. Africa stands out as the continent with the most rapidly expanding and youthful population.
2 days ago
Nigeria’s economy is projected to grow to 3.3 per cent this year, while it may recede to 3.0 per cent in 2025. In its latest World Economic Outlook report, ‘Steady but slow: Resilience amid divergence,’ the International Monetary Fund said that Nigeria’s economy is expected to better 2023 growth which was pegged at 2.9 per…
2 days ago
The Management Recruitment Group (MRG Global), a leading UK-based executive search firm with an international presence, has announced its expansion into Africa, solidifying its commitment to providing exceptional talent solutions worldwide. MRG Global specialises in senior appointments in real estate and facilities management across diverse sectors globally. With a central hub in South Africa and…
×
Get the latest news delivered straight to your inbox every day of the week. Stay informed with the Guardian’s leading coverage of Nigerian and world news, business, technology and sports.
0 Comments
We will review and take appropriate action.