WORLD ENERGY OUTLOOK 2008 FACT SHEET: SUB-SAHARAN AFRICA
Could revenues in oil- and gas-rich sub-Saharan African countries
alleviate energy poverty?
n Oil and gas exports in the top-ten producing sub-Saharan African countries are set
to grow steadily to 2030, providing the means for alleviating poverty and expanding
energy access. In the Reference Scenario, in which no change in government policies is
assumed, their oil exports rise from 5.1 mb/d in aggregate in 2007 to 6.4 mb/d in 2030. Gas
exports, largely as liquefied natural gas (LNG), increase from 21.6 bcm in 2006 to 130 bcm
in 2030. These projections hinge on a reduction in gas flaring, adequate investment and
avoidance of disruption to supplies through civil unrest. The ten countries flared 40 bcm
in 2005 — almost three times the entire region’s gas consumption. These countries could
make direct use of their gas resources by using currently flared gas for power generation
or distributing it in cities. The liquefied petroleum gas (LPG) extracted from natural gas or
produced in refineries can provide a low-cost source of supply for distribution networks.
n Less than a third of households in the majority of oil- and gas-rich countries have access
to electricity or to clean fuels for cooking, like LPG, kerosene, biogas and ethanol
gelfuel. About 150 000 people, mainly women and children, die prematurely each year in
these countries because of indoor air pollution from burning traditional fuels – essentially
fuelwood and charcoal – for cooking in inefficient stoves or open fires. In the absence of new
policy initiatives, the number of people living without electricity and relying on fuelwood
and charcoal for cooking rises over the Outlook period, as the population grows.
n Government revenues from oil and gas are set to rise strongly, giving these countries
the means to speed up economic and social development and alleviate poverty. The
government take in the top ten oil- and gas-producing countries is projected to rise from
some $80 billion in 2006 to about $250 billion in 2030. Nigeria and Angola account for 86%
of the $4.1 trillion cumulative revenues of all ten countries over 2006-2030. All these
countries desperately need sustained and sustainable economic development. Modern
energy services are a crucial prerequisite, bringing major benefits to public health, social
welfare and economic productivity. In most of the countries, improving energy access
will entail fundamental political, institutional and legislative reform, as well as efforts
to strengthen the capability of regional and local authorities to implement programmes
and to expand access to credit.
n The upfront cost of expanding access to modern energy is small relative to the wealth
that these countries’ hydrocarbon resources will generate. An estimated $18 billion is
needed to achieve universal access to electricity and to LPG cooking stoves and cylinders
– a mere 0.4% of the projected cumulative government revenues from oil and gas export
revenues in 2007-2030. The cost relative to the government take in Equatorial Guinea,
Angola and Gabon is only 0.1%.
n Sub-Saharan Africa’s hydrocarbon-resource wealth will lead to economic development
only if governments manage wisely and honestly the development of the sector
and the revenues that accrue. An improvement in the efficiency and transparency of
revenue allocation and the accountability of governments in the use of public funds
would improve the likelihood that oil and gas revenues are actually used to alleviate
poverty generally and energy poverty specifically.