UGANDA AGHAST AT EU RESOLUTION ; NIGERIA HAS PORTUGAL WORRIED
I will start by dispelling this widely held notion that the entire African continent is rich in mineral resources. Yes, some countries on the continent are indeed rich in mineral resources. But several African nations are actually resource-poor, meaning they have little or no mineral resources.
Among those African nations lucky to have mineral resources, only a fraction of them are rich in the petroleum, which, as far as I am concerned, is the most important natural resource.
For decades, African countries like Angola, Nigeria, Egypt, Algeria, Sudan, Libya, Gabon and Congo Republic (not to be confused with Democratic Republic of Congo) have enjoyed the privilege of having petroleum resources needed to keep their economies running. Some of these petroleum-producing nations have well-developed petrochemical industrial sectors capable of producing key products like plastic for commercial use and fertilizer for agriculture.
SIDE BAR : Nigeria alone has a couple of government-owned and privately-run fertilizer companies. A new, privately-owned factory capable of producing three million tonnes of fertilizer per annum, the largest anywhere in Africa, was opened in Nigeria in March 2022 as reported here: https://www.africanews.com/2022/03/23/nigeria-launches-africa-s-largest-fertilizer-plant/
Countries rich in solid minerals such as diamond-producing Botswana and copper-producing Zambia do not enjoy this privilege, and therefore have to import petroleum and petrochemical products from overseas to meet their national needs. Nevertheless, both nations are lucky to have diamonds and copper to exchange for the petroleum. Poorer countries with zero mineral resources such as Senegal, Mali and Malawi go through the wringer to obtain their overseas petroleum supplies.
Quite recently, a few countries, Uganda, Ghana, Tanzania, Kenya and Mozambique, joined the exclusive club of nations with petroleum resources. Out of the five nations mentioned, landlocked Uganda has been the most enthusiastic about exploiting their petroleum fields estimated to contain some 6.5 billion barrels of crude oil. The Ugandans developed a plan to build a domestic oil refinery and signed a deal with neighbouring Kenya to supply pipeline crude oil with Tanzania acting as a transit country.
SIDE BAR : Kenya later pulled out of the deal following the unexpected discovery of crude oil reserves of 750 million barrels on its own territory. Tanzania-- which has natural gas reserve volumes of over 50 trillion cubic-feet-- has agreed to remain in the deal which would see its territory serving as transit corridor for Uganda's pipeline
For ostensible environmental reasons, the Parliament of the European Union was not happy with the planned Uganda-Tanzania pipeline project, officially known as the "East African Crude Oil Pipeline", which would transport crude oil from Western Uganda to the Port of Tanga situated on Tanzania's east coast. From the Tanzanian port, the petroleum of landlocked Uganda can be shipped to overseas markets via the Indian Ocean.
The EU Parliament passed a resolution urging the international community to exert maximum pressure on Ugandan and Tanzanian authorities, as well as the project promoters and stakeholders, to stop oil activities around Lake Albert.
Predictably, Uganda reacted with anger. Allegations of "neocolonialism" bounced around the mass media space. The EU Parliament, unfazed, doubled down on their "Green Energy" talking points. Then the government of Uganda issued a warning to French energy giant, TOTAL, about the dangers of listening to EU parliamentary resolutions. The French energy company assured the Ugandan government that it would continue its involvement in the pipeline project.
The Ugandan government had no reason to worry about the sincerity of such assurances since the China National Offshore Oil Corporation (CNOOC) was already involved in the pipeline project and would gladly acquire the mineral exploitation rights of TOTAL should the French company decide to bow to pressure from the EU to pull out of Uganda. Indeed, the Ugandan President Yoweri Museveni, announced that the pipeline would be ready for commissioning in Year 2025 and no amount of pressure from Europe would stop the completion of the project.
Image above is a screenshot of a Twitter post by Ugandan President Yoweri Museveni saying that the Uganda-Tanzania pipeline would be ready in 2025
Funnily enough, European stance on petroleum seems to change as soon one makes the four-thousand-kilometre jump from East Africa to West Africa. In West Africa, EU believes petroleum is good and should be supplied as quickly as possible to European countries in the form of Liquefied Natural Gas (LNG). In East Africa, the EU believes that petroleum is bad for "climate change reasons" and so the Uganda-Tanzania pipeline has got to be stopped; after all, it is going nowhere near Europe.
To underline their seriousness about the "goodness" of West African petroleum, the European Union sent a delegation led by Matthew Baldwin (who is surprisingly British) to Nigeria in July 2022 to ask for more LNG than it was already supplying.
Unfortunately, for the European Union, LNG facilities in Nigeria are sclerotic due to a severe lack of investment and therefore does not have the capacity to double its supply of liquefied natural gas to the EU as requested by Matthew Baldwin.
In fact, the EU delegation was pointedly told by Nigerian government officials that the country did not have the capacity to export more natural gas to Europe. The only thing Baldwin and his team got before leaving Nigeria was a vague promise to improve LNG producing facilities in the country.
SIDE BAR : Nigeria has never cared about marketing it's Liquefied Natural Gas. The same goes for heavy crude oil, bitumen, gold, uranium, cobalt, limestone, tin, coal and kaolin found all over the country. All governmental efforts are singularly focussed on the sale of just one product-- light crude oil, which Nigeria has in abundance.
Of course, the Nigerian federal officials that met Matthew Baldwin was understating the problem with the country's LNG supply. The problem isn't just that Nigeria lacks EXTRA capacity to double its LNG supply to Europe; the problem is that the CURRENT capacity to supply Europe is declining as the LNG facilities continue to degrade due to lack of proper maintenance. To worsen matters, opportunistic criminals are taking advantage of lax security to vandalize and steal pipelines from LNG producing plants.
Portugal is in a frantic mood after learning that Nigeria might not be able to fulfil its order of LNG shipments. Nigerian federal officials have assured Portuguese Minister of Environment and Climate Action, Mr. Duarte Cordeiro, that they can fulfill the order. But the fact remains that the main LNG Plant in Bonny Island, Southern Nigeria, is now operating at only 60 percent of its original capacity.
Portugal is speaking to officials of its former colony, Mozambique, which recently joined the exclusive club of African countries with petroleum resources. Contrary to what some people might think, relations between both countries are currently amicable and much better than it was in the 1970s and 1980s.
However, Mozambique is not in a position to meet Portugal's natural gas needs because LNG facilities needed to fulfil them do not exist at the moment. In fact, construction work on some LNG plants in Mozambique had to be suspended because of the activities of ISIS-aligned insurgents.
SIDE BAR : After the Mozambican Armed Forces folded like a lawn chair in the face of Islamist firepower, the highly professional Rwandan Defence Force (RDF) was flown to Mozambique to clobber the ISIS-aligned fighters. And so far, RDF troops have not failed in that mission.
Mozambican authorities have already explained to Portuguese energy officials that even if the Islamist insurgency were to end today, the construction of new facilities required to supply gas to Portugal could only proceed in the year 2024 and no earlier. In other words, Portugal would have to look elsewhere for short-term LNG supplies if Nigeria fails to deliver its order
THE END
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