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Africans seek help with trans-Sahara gas pipeline.

AFRICA's major natural gas producers are seeking international backing for the construction of a pipeline across the Sahara desert which has been recommended by a United Nations pre-feasibility study. The project would stimulate economic development in many industrially backward areas of Africa hitherto retarded by the absence of locally available energy, technology and investment resources.

It would increase substantially Africa's hydrocarbon exports to the energy-hungry markets of Europe and lead to the establishment of several interlinked regional electricity grids consuming natural gas. In the longer term, the project would also create opportunities for substantial electricity exports to Europe. Natural gas is the cleanest of all the fossil fuels. Its increasing use for electricity generation is widely seen as part of a solution to global environmental pollution.

The pre-feasibility study compiled by the Un's Economic Commission for Africa (ECA) also calls for investment in two additional international gas distribution and utilization systems, one for Mozambique and Zimbabwe and the other for Tanzania and Kenya.

These facilities, which may be built during the Un's current Second Transport and Communications Decade for Africa, would necessitate investment of many billions of dollars. The ECA argues that they are essential to encourage the exploitation of the continent's natural gas reserves and to stimulate exports.

Conducted at the request of a conference of African Ministers of Transport, Communications and Planning, the ECA study concludes that the projected trans-Sahara gas trunk line system designed to cover en-route as well as export demand 'can be expected to prove economically feasible'. It would enhance Africa's 'relatively favourable position in relation to the Americas and the European markets, enabling the continent to compete successfully' for export revenues. And it would stimulate regional development by providing a cheap, relatively environment-friendly source of energy along the way.

Detailed studies of the two proposed distribution and utilization systems for East Africa also project satisfactory returns on investment. Another ECA study recommends the development of a small-scale gas utilization system in Ethiopia.

Africa's very unequally distributed proven gas reserves are in the region of 8,600 bcm, enough to supply the continent's own needs and cover substantial export demands beyond the turn of the century.

The proposed investment would stimulate trade and regional development in many countries of the continent. The ECA has appealed for international assistance to Africa's efforts to develop its huge unutilized natural gas reserves. Nigeria is leading the continent's other big gas producers by sponsoring a series of international expert meetings in preparation for full feasibility studies.
Region 1970 1975 1980 1985 1991
Africa 3,834 5,243 5,683 5,888 8,601
Mideast 6,627 15,326 18,541 25,874 37,822
N America 9,428 8,547 8,015 8,400 7,540
L America 1,874 2,353 4,353 5,440 7,562
W Europe 3,571 3,962 3,870 5,645 5,734
E Europe 12,599 24,274 31,613 38,059 53,393
Asia &
Australia 1,550 3,362 4,796 7,116 11,170
Source: UN Economic Commission for Europe

Apart from Nigeria, Algeria and Libya, the African gas exporting giants, many countries across the continent, including Ethiopia, Guinea, Madagascar, Mozambique, Namibia, Rwanda and Tanzania hold big deposits in areas where oil has not yet been reported in significant quantities. Professor Jibril Aminu, the former Nigerian Energy Minister, comments: |one of the effective indices of judging development in Africa in the next decades will be the increased use of hydrocarbon, especially gas. More gas means more development, less oil used, less destruction of the forests for firewood. What is more, Africa has more gas than oil, and plenty of it. Tremendous investment is therefore required to develop natural gas, to distribute the gas within each country and among each country's economic sub-sectors, and to reticulate Africa with pipelines which will solve the issue of uneven availability of gas in Africa and the general low utilization in the continent. I am pleased with the interest the World Bank and the European Community appear to have in this idea.'

The trans-Sahara link would connect the rich gas fields of the Gulf of Guinea (where Nigeria alone holds 32 per cent of Africa's total proved resources) with the Mediterranean region (where Algeria holds another 42 per cent) creating an enormous market force supplying the constantly growing energy consumption of Europe.

At the start of this decade, the proven combined reserves of the Mediterranean countries were evaluated at 5,644 bcm, with Algeria and Libya accounting for 80 per cent of the total. In 1990, the south Mediterranean region produced 68.31 bcm but consumed only 59 per cent of its output.

Apart from exploiting the expanding European import market for energy, the first option in the use of Africa's natural gas resources must be to encourage domestic industrial development, argues Claudio Simeoni, an energy economist at Italy's Ente Nationale Idrocarburi, in an important recent discussion paper. |And natural gas', he says, 'seems the ideal fuel to use in order to obtain strong acceleration of economic development'.

North Africa and the Middle East are already moving towards a master plan for the Arab world, projecting the establishment of five regional electricity grids using gas and freeing oil for exports. The grids will be eventually linked with a view to producing a substantial electricity surplus for sale to Europe.
Country 1990 1991
Bahrain 183 177
Iraq 31,115 3,107
Jordan 11 15
Kuwait 1,400 1,394
Oman 279 290
Qatar 4,620 4,613
Saudi Arabia 5,220 5,184
Syria 245 220
United Arab Emirates 5,650 5,623
Yemen 198 198
Source: UN Economic Commission for Europe

The plan, which is linked with the trans-Sahara pipeline project, has been adopted by the governments of the region following a recent symposium in Damascus held by the United Nations Development Programme and its Economic and Social Commission for Western Asia. The idea is to synchronize the national energy policies and industrial development strategies of the region and to create a single gas-based electricity market early in the next century.

The plan has been made possible by current technological advances in the field of combined heat and power production significantly improving both the efficiency and the economy of electricity generation from gas. The Jordan Ministry of Energy predicts that the new gas powered plants will be able to provide electricity 'at a lower cost and with less adverse environmental impact and safety problems than fuel-oil fired, coal-fired or nuclear power plants'. Many plants are already being converted to gas. The combined and unevenly distributed natural gas resources of the Maghreb and the Middle East comprise 21 per cent of the world reserves. But only 8 per cent of gas produced in the Arab countries is marketed beyond national boundaries and less than 60 per cent of that production is used in the local markets.

There is at least one major natural gas producing country in each area to be covered by a single electricity grid, ensuring ample local energy supplies for the highly efficient combined cycle power plants of the future. These are the five projected electricity grids:

-- The Maghreb group uniting the electric utilities of Algeria, Tunisia, Libya, Morocco and Mauritania;

-- The North-Eastern group comprising the electric utilities of Iraq,

Jordan, Lebanon, Syria and Egypt;

-- The Saudi Arabian group integrating the four major local electric utilities;

-- The Yemen group linking the existing separate grids of the north and the south of that country; and

-- The Gulf group including the electric networks of Bahrain, Kuwait, Oman, Oatar, the United Arab Emirates and the eastern part of Saudi Arabia.

Natural gas is thus to provide most electricity consumption throughout the Arab countries. In the final stage of the project, the five groups are to be interconnected to form a single system enhancing the technical efficiency and economic performance of the electrical sector.

The UN development plan envisages continued rapid improvements in electrical transmission technology, leading to the eventual connection of the Arab system with Europe through Turkey in the North East and Spain in the West. This would enable Arab gas producers to export their surplus to Europe in the form of electrical energy.

The pre-feasibility study concludes that 'in all African countries with sufficient natural gas reserves the development of gas utilization systems seems in principle to be reasonable at least in the long term or at the very least for special use. Its authors have rejected proposals for erecting an integrated, continent-wide gas distribution network on grounds of economic considerations. But the evaluation of the trans-Sahara trunk line system confirms its economic feasibility. The study describes it as 'an outstanding project for the whole of West Africa' with enormous global dimensions. The study argues: |Taking into consideration the growing concern all over the world with the problems of environmental pollution, the eradication of the rainforests and the search for benign new energy sources and the particular application of all these issues to Africa--the development of natural gas utilization and distribution facilities holds out a special hope for the continent'.

These are the other project packages for regional gas distribution/ utilization systems endorsed by the study:

-- Mozambique-Zimbabwe: A detailed feasibility survey is recommended for a gas distribution system in Mozambique, exploring export possibilities to neighbouring countries. The study projects profit opportunities for the energy sector with a likely benevolent effect on other industries.

-- Tanzania-Kenya: Proposals for a combined gas distribution system for the two countries were found technically sound, promising a satisfactory return on investment and long-term stimulus for regional economic development.

-- Ethiopia: Preparatory studies conducted in Ethiopia suggest that a gas utilization system could contribute to solving some major long-term energy problems in that country. The ECA has called for further investigations leading to the development of a small-scale gas industry.
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Author:Land, Thomas
Publication:Contemporary Review
Date:Aug 1, 1993
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