ARDA plans carbon mitigation strategies to attract finance for cleaner fuels
Amidst rising population, demand for petroleum products and the need for cleaner fuels, African Refiners and Distributors Association (ARDA) has told stakeholders and political leaders on the continent to prioritise carbon mitigation strategies. They stressed that it remained key for long-term refining sustainability and key option towards securing finance.
Speaking at the Angola Oil and Gas 2022 conference in Luanda, Executive Secretary of ARDA and former management staff at the Nigerian National Petroleum Company Limited, Anibor Kragha said refineries play a central role in global emissions as emitters of CO2 and suppliers of fossil fuels.
According to him, regulation would increasingly affect profitability of refining companies in selected regions, and impact long-term demand patterns, therefore refineries must mitigate downside risks through internal-abatement efforts and new value creation opportunities.
Kragha said the development, however, offers opportunities to refiners, especially in converting their assets to sustainable energy hubs.
Kragha noted that refiners could leverage clean hydrogen transportation tub through Liquid Organic H2 Carrier (LOHC), thereby e-purposing their catalytic reformer to extract H2 from LOHC.
He equally noted that waste plastics recycling could become an option for conversion of diesel HDS or HCK unit into waste plastics pyrolysis oil upgrading unit, while adding that renewable lipids and vegetable oils transformation into renewable diesel and Sustainable Aviation Fuel (SAF) remained a cleaner option.
Insisting that Africa must drive towards self-sufficiency and service of local and regional markets, Kragha said import requirements for transport fuels continue to grow in sub-Saharan Africa, making the region the world’s largest importer.
Kragha added that Africa needed inclusive, equitable energy transition roadmap that captures priorities, challenges and perspectives of Africa’s low-emitting countries
“Roadmap must not prioritise near-term emissions reductions (with relatively little climate benefits) over support for economic development & energy transformation,” he said.
ARDA, Global LPG Partnership (GLPGP) and Standard Bank had developed a proposed fund in the second quarter of 2021 to deploy financing for rapid scale up of clean cooking with LPG in Sub-Saharan Africa.
He said the fund would provide critical mass of technical advice and financing for qualified countries through national LPG sector ecosystems.
With gas now viewed as essential transition fuel, Kragha disclosed that the International Finance Corporation (IFC) has awarded GLPGP multi-country study contract to assess enabling environment for LPG projects, adding that ARDA and GLPGP are re-engaging on fund for execution of LPG and BioLPG projects.
Kragha stated that Africa’s growing energy demands must be met with cleaner fuels to address pollution and public health issues, while stressing that separate implementation strategies were needed for cleaner fuels, lower-carbon power generation and sustainable renewable energy solutions in Africa.
“Measured, decade-by-decade Sustainable Finance Plan is required to ensure investments are made to deliver a unique African Energy Transition Plan. Coordinated refinery upgrade and storage and distribution infrastructure projects are critical,” Kragha said.
He pledged the commitment of ARDA to securing project financing for strategic opportunities in the African downstream oil sector.