Africa Rails Against Anti-Oil Climate Agenda

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African oil ministers are pulling no punches in calling for a slower and fairer energy transition while amplifying the risks falling investment in fossil fuels pose to producers' economic development. Despite much hot air and rhetoric around African solidarity and prioritizing inter-African energy trade over compliance with externally imposed conditions, most governments are still calculating how to navigate and exploit opportunities that arise. The watered-down resolutions at the end of COP26 gave some what they wanted, with a pledge to “phase down” rather than “phase out” coal. South Africa, Botswana and Zimbabwe rely on coal for 72%, 67% and 50% of power generating capacity, respectively. South Africa, one of the world’s top dozen greenhouse gas emitters, got a headline deal worth $8.5 billion from the US, UK, EU, Germany and France to accelerate its transition. Yet days after South Africa’s President Cyril Ramaphosa hailed the deal as a “watershed moment” in Glasgow, Energy Minister Gwede Mantashe told a recent energy conference in Cape Town that Africa should not be “coerced” by the global anti-fossil fuel agenda. It remains to be seen how the highly conditional deal, which comprises grants, soft loans, investment and risk sharing instruments, will play out as South Africa has avoided signing the Global Methane Pledge. Mantashe was also noncommittal about the pace at which it would shrink coal’s contribution. State power provider Eskom’s $26 billion debt burden and constant load-shedding highlight the scale of the challenge relative to the money on offer.

Equity and Debt Markets, Low-Carbon Policy, Oil Supply, Offshore Oil and Gas
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