Major oil companies should reduce carbon emissions in Africa, otherwise international investors will turn away from them. That is the conclusion of the consulting firm Wood Mackenzie in its review.
Oil majors should pay special attention to their projects in sub-Saharan Africa, which at the moment are considered among the “dirtiest” in the world. According to WoodMackenzie, modern air filtration and purification systems are hardly used. This particularly concerns the burning of associated gas (a mixture of gases emitted during oil production), as well as the frequent lack of purification systems at gas liquefaction plants. Despite the fact that African projects account for a small share of global oil and gas production, they are second only to Australian projects in terms of emissions.
“The carbon intensity of projects is now a key metric for investors. Reducing emissions and considering a new energy area is indeed inevitable,” the review said.
Natural gas and the new liquefaction plants built in Senegal and Mozambique are now receiving particular attention. Although gas has been seen as a transitional fuel on the road to cleaner energy, many investors are questioning its use for environmental purposes.
Wood Mackenzie analysts predict that liquefied natural gas will account for up to a third of all harmful emissions, assuming Africa can realize its ambitious plans to increase production in the next 10 years. Plants should invest in cleanup systems to drastically reduce emissions, the report said.
Lack of modern infrastructure is one of the region’s key problems. Analysts say the problem can be solved and cite the example of Nigeria, which has reduced oil and gas emissions by 75 percent in 15 years.
According to studies, gas production in Asia and Africa is at odds with efforts to preserve the climate. Experts at the International Institute for Sustainable Development (IISD) found that from 2017 to 2019, low- and middle-income states received about $16 billion annually from G7 members to develop the gas industry. The combined investments of the largest economies in fossil fuel extraction were four times as much as funding for “clean” wind or solar projects.