C. Derek Campbell, Executive Chairman, African Metals Group; Dr Sara Vakhshouri, Founder and President, SVB Energy International; Dr Lars Schernikau and Erik Prince, Founder, Frontier Service Group
As the continent’s premier energy event, African Energy Week (AEW) 2021 in Cape Town offers global and African stakeholders the opportunity to engage, network, facilitate deals, and drive the continent into a new era of enhanced energy and economic growth. Accordingly, an energy dialogue session on the geopolitics of energy in Africa aimed to address the challenges and opportunities faced by the African energy industry, proposing an integrated and cooperative approach to the continent’s energy sector expansion.
Moderated by Dr Sara Vakhshouri, founder and president, SVB Energy International, panel participants included Dr Lars Schernikau; Erik Prince, Founder, Frontier Service Group; and C. Derek Campbell, Executive Chairman, African Metals Group. With Africa’s rich hydrocarbon resources comprising a predominant topic in global energy dialogue, the speakers emphasized the role that oil and gas will continue to play in Africa.
“One of the things my platform does is focus on the emerging frontier market and keep an eye on what is happening in Africa. One of the fundamental things that we talk about that Americans need to understand is that it is not a place to exploit resources; but a partner to form relationships to help bring a global population’s living standards up. We have energy poverty that impacts Africans engaging with the continent. Africans start to take a front seat driving role in how they not only create a narrative, but start to develop both continental and regional, nation-based policies on how to properly exploit their resources,” stated Campbell.
With a focus on enhancing energy security across Africa, the panel provided insight on strategies to improve security, bringing attention to and addressing the challenges faced in resource-rich basins across the African continent.
“Money and security is key for Africa. The challenges we have had in terms of providing security in terms of infrastructure support is that they see security as more of a cost than an investment. It will be good that at a policy level, people start to vector their thought [process and look at it as an investment. We need to look at security as an insurance policy. There is commercial money out there that wants to get into this market but their needs to be the right security in place,” continued Campbell.
Specifically, participants emphasized the role of the private sector in Africa, promoting alternative strategies traditionally imposed by governments to ensure security.
“As you get into the concerns of organisational theft and crime, remember that the private sector can ramp up to help you put out the fire and keep it at bay. Whether it is the organisational crime/theft of oil in Nigeria to the Boko Haram of killing people in the north, to the problems with the fall of Ghadaffi. The entire region continues to suffer, and the private sector can help put that fire out. In Mozambique, I am particularly sad to see what is happening there. I can’t prove it, but if I was a betting man, I would say that is an insurgency. Insurgencies in Africa like that don’t explode overnight,” stated Prince.
Meanwhile, the panel discussed the role of renewables in Africa’s energy future, emphasizing that solar and wind alone cannot sufficiently address energy poverty or meet demand. With renewables comprising intermittency and high-cost challenges, an integration energy mix might just be the best method of accelerating energy security.
“When we talk about geopolitics we need to understand where energy comes from and where it’s going. When we are told to stop funding fossil fuels, we are being told to stop funding 80% of our energy. Renewable technology depends on natural resources such as wind and the return on energy is relatively low. A solar panel needs ten years to get the energy back from what was used to build it. To sustain modern society, we need a minimum Return of Investment of between 8 and 10, of which renewables are not. Wind and solar is limited by how much energy you get, there is only as much energy as there is wind. Wind and solar is not the solution and cannot be because it will lead to energy scarcity. Wind is not even a factor because it is not as available as other resources,” stated Schernikau.