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Prospects for LNG and Hydrogen Export from Sub-Saharan Africa to the EU

Dirk Kohnert

MPRA Paper from University Library of Munich, Germany

Abstract: Since Russia's war in Ukraine, many European countries have been scrambling to find alternative energy sources. One of the answers was to increase imports of liquefied natural gas (LNG). By bypassing the use of pipelines from the East and by building LNG terminals, the EU opened up a wider variety of potential suppliers. The Europe-Africa Energy and Climate Partnership provides a framework for a win-win alliance. African countries will be key players in the future, including sub-Saharan countries such as Nigeria, Senegal, Mozambique and Angola. According to the REPowerEU plan, hydrogen partnerships in Africa will enable the import of 10 million tons of hydrogen by 2030, replacing about 18 billion cubic meters of imported Russian gas. Algeria, Niger and Nigeria recently agreed to build a 4,128-kilometer trans-Saharan gas pipeline that would run through the three countries to Europe. Once completed, the pipeline will transport 30 billion cubic meters of gas per year. The African Coalition for Trade and Investment (ACTING) estimates potential sub-Saharan LNG export capacity at 134 million tonnes of LNG (approximately 175 billion m3) by 2030. Sub-Saharan Africa is also expected to become the main producer of green hydrogen by 2050. However, this market remains to be developed and requires significant expansion of renewable production and water availability. However, the EU countries and companies involved would be well advised to take note of the adoption of much stricter EU greenhouse gas reduction targets for 2030 and the publication of the European Commission's methane strategy. That being said, the EU could risk having more than half of Europe's LNG infrastructure idle by 2030, as European LNG capacity in 2030 exceeds total forecast gas demand, including LNG and pipeline gas. Regardless, it should not be forgotten that African countries want and need to develop their domestic gas markets as a priority, and that export potential depends on this domestic development. However, LNG alone is not enough to ensure the resilience of the system in the event of a supply failure. Alternative energy sources and energy conservation remain essential.

Keywords: LNG; Hydrogen economy; e-fuels; LNG terminals; Natural gas; Energy security; Gas storage; Sub-Saharan Africa; EU; REPowerEU; Trans-Saharan gas pipeline; emerging markets; Sonatrach; European Green Deal; African Continental Free Trade Agreement; Eni; TotalEnergies; BP; Nigeria; Angola; Mozambique; Tanzania; Senegal; Cameroon; Equatorial Guinea; Namibia; African Studies (search for similar items in EconPapers)
JEL-codes: E22 E23 F13 F18 F23 F35 F54 L71 L95 N57 N77 O13 Q35 Z13 (search for similar items in EconPapers)
Date: 2023-12-09
New Economics Papers: this item is included in nep-afr, nep-cis, nep-ene, nep-env, nep-eur, nep-int and nep-reg
References: View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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https://mpra.ub.uni-muenchen.de/119405/1/MPRA_paper_119405.pdf revised version (application/pdf)

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