Cooperation in the Energy Sector

KEY CONCLUSIONS

Africa has great investment potential in the energy sector

“At present, African countries have 14.4 trillion cubic metres of natural gas reserves. This is a very large amount […]. The share of natural gas produced by African countries in the total volume of commercial gas production around the world will increase and exceed 10.4% by 2050”, said Yury Sentyurin, Secretary General of the Gas Exporting Countries Forum (GECF).

“Africa is a place that offers a great return on investment. And I think that Russia needs to take the bull by the horns and understand the market. You have already made an effort in this direction. Perhaps within 10–15 years we will be able to achieve global dominance”, said Wale Tinubu, Group Chief Executive of Oando PLC.

“If we join efforts, including in terms of cooperation between Russia and Africa, we will come out on top. We will all have a larger market on which competing technologies will emerge. This all ties our interests together, and if we share these views, we will be successful […]. Our combined efforts will create a different future not only for us, but for lots of people. And for me there is a great hope and desire that we should take Africa seriously for the next 100 years”, said Pavel Sorokin, Deputy Minister of Energy of the Russian Federation.

Russian energy companies are actively developing cooperation in Africa

“Transneft has had success in coming to work on the African continent. Our first projects took place in Algeria with the Algerian state oil and gas company Sonatrach. We are now working on several projects in Algeria […]. We are ready to sign a memorandum of cooperation with the Moroccan oil and gas company ONHYM […]. We want this to be a long-term, mutually beneficial, and high-tech partnership”, Transneft Vice President Mikhail Margelov said.

“There are many areas where Africa and Russia can cooperate. Morocco, in particular, has extensive experience working with Russia: power plants have been built. There are currently Russian companies in Morocco that work in the energy sector and believe that there are good prospects”, said Aziz Rabbah, Minister of Energy, Mines and Environment of the Kingdom of Morocco.

 

PROBLEMS

Lack of funding and technology

“The only problem we have is the investment that we need. We do not have the infrastructure to receive gas […]. We have everything, but no gas. We need terminals, just like Morocco, South Africa, and Egypt do”, said Gabriel Mbaga Obiang Lima, Minister of Mines and Hydrocarbons of the Republic of Equatorial Guinea.

“Funding is a critical factor in the implementation of a project in Africa. What if I don’t want to send gas to Western Europe, but to my brothers in Africa […]. But there is not enough infrastructure or ports. Sure, there is Cape Town and certain points where this can be obtained. But this requires funding”, Tinubu said.

“Today, there are two main and key issues that need to be addressed for African countries in order to increase work related to natural gas: access to high technologies and access to investment […]. Thanks to new technologies and investments, the contribution that African countries make to working with natural gas will increase significantly”, Sentyurin said.

Lack of access to energy for a substantial part of the African population

“In Africa, there are more than 600 million people who still do not have any access to any type of energy. We’re sitting on a ticking time bomb”, said Bronwyn Nielsen, Founder and Chief Executive Officer of Nielsen Media and Associates and Editor-in-Chief of CNBC Africa (2013–2017).

 

SOLUTIONS

Intensify international cooperation

“Russia is bringing what we need […]. Russia has technology – that’s what we lack, that’s what we need from Russia […]. Why do we need technology? Creating jobs will become a solution for Africa because we want to develop the economy for ourselves using resources”, Lima said.

Create clear and stable conditions for investors

“We need to create a platform for successful cooperation with the private sector. A policy has been instituted in order for the rules to be defined. How should the government behave? A partnership is needed here. There will be a partnership if the rules of the game are clear. If the natural resources policy is understandable and the rules are clear, you will see competition and partnership projects at the national level”, said Onajite Paul Okoloko, Group Chief Executive Officer and Group Managing Director of Notore Chemical Industries Plc.

Pay attention to environmental issues

“Environmental stability issues are extremely important for us. We pay attention to the green agenda. From the standpoint of traditional energy companies, we understand this perfectly. You have to pay increased attention to the environment. Our company has been running a programme for several years to reduce the specific emission of pollutants into the atmosphere. According to the 2018 results, we reduced these emissions by another 1%”, Margelov said.

“Several African countries are now switching to the use of renewable energy sources, such as wind or solar. Russia is very developed in this regard. This cannot be ignored, either”, Rabbah said.

For more information, visit the Roscongress Information and Analytical System at roscongress.org.

To participants in the Russia–Africa Economic Forum

Ladies and gentlemen,

It gives me great pleasure to welcome you at the opening of the Russia–Africa Economic Forum.

The rich history of relations between Africa and Russia has never seen an event of a similar scale. Members of government agencies and business community, and experts are meeting at this Forum to substantively discuss the current status and prospects of cooperation and a wide range of topical issues of the world economy.

Today, the countries of Africa are well on their way towards social, economic, scientific and technological development, and are playing a significant role in international affairs. They are strengthening mutually beneficial integration processes within the African Union and other regional and sub regional organizations across the continent.

In recent years, the traditionally friendly ties of partnership between Russia and Africa have gained new momentum, both at a bilateral level and in various multilateral formats. In addition to preserving our past experience of successful cooperation, we have also managed to make significant new steps forward. Trade and investment are growing dynamically, and new joint projects are under way in extractive industries, agriculture, healthcare, and education. Russian companies are ready to offer their scientific and technological developments to their African partners, and share their experience of upgrading energy, transport and communications infrastructures.

I hope that the Forum will help identify new areas and forms of cooperation, put forward promising joint initiatives that will bring the collaboration between Russia and Africa to a qualitatively new level and contribute to the development of our economies and the prosperity of our peoples.

I wish the Forum’s participants fruitful work and all the best.

Vladimir Putin

The Russia–Africa Summit, which is taking place in Sochi on 23–24 October 2019, encapsulates the historically friendly relations between the African continent and the Russian Federation. This Summit carries great significance as it is the first of its kind to emerge during a period of major global and international transformations. In response to the aspirations of the people it is representing, the Summit intends to build a comprehensive framework for expanding Russian–African relations into broader horizons of joint cooperation across different fields.

The African nations and Russia share a common understanding of international relations, based on the principles of respect for the rule of international law, equality, non-interference in the internal affairs of states, and the peaceful resolution of disputes. Both sides affirm their commitment to support multilateral actions to oppose new international threats, be they terrorism and extremism in all their forms, or declining growth rates. The two sides share a firm conviction regarding the importance of developing trade flows and supporting mutual investment in such a way as to ensure security, peace and development for the African and Russian people.

African countries have huge potential and opportunities that will allow them, once efforts to streamline their economies have been achieved, to emerge as real global players. In recent years, the nations of this continent have achieved major successes spanning the political, economic, social and administrative spheres. Africa has flourished in terms of growth over the past decade, reaching a continent-wide growth rate of 3.55% in 2018.

The African Union Summit, which was held in Niger in July 2019, continued the efforts of the African countries and saw the African Continental Free Trade Agreement come into force, along with its operational instruments. The agreement is one of the key objectives of Agenda 2063, an African development strategy that has been created to address the African people’s desire for prosperity and decent living standards.

These successes are opening up wide-ranging prospects for cooperation between African countries and the Russian Federation, and confirm the determination of African governments and their people to cooperate with multiple partners in order to establish mutually beneficial relations.

With this in mind, we express our hopes that the Russia–Africa Summit will help in the establishment of constructive strategic relations, based on partnership between two sides across various fields, and in the service of fulfilling the hopes and aspirations of the African people and their friends in Russia.

President of the Arab Republic of Egypt
Abdelfattah ALSISI