Saturday, August 20, 2022

Natural Gas: Germany considers LNG imports from Senegal

 With gas supply from russia becoming more precarious and ethically problematic, Germany is scouting around for new sources of supply. On his jorney through several african countries, germany Chancellor Olaf Scholz has explored options of gas exportations of gas from Senegal zu Germany. Climate advocates however find fault with this, WELT:

Senegal has big plans: The West African country wants to use the newly created gap in the gas supply and supply industrialized countries like Germany with liquefied natural gas (LNG) in the future.

According to estimates by the energy company BP, more than 425 billion cubic meters of natural gas are waiting to be extracted off the coast of Senegal and Mauritania. The local enthusiasm is great: “Experts consider the estimated gas resources in Senegal to be world-class. Senegal is on the way to becoming a major gas exporter,” says the Senegalese newspaper Le Quotidien.

Although the country has large gas reserves, it was only the Ukraine war and the move away from Russian gas that really revived hopes of a boom. "The war changed everything," quoted the Washington Post as Mamadou Fall Kane, deputy chief of Senegal's natural resources agency. "Now Europe is knocking on our door."

Because after Africa was asked for years by the European Union, for example, to rely on renewable energies, the energy crisis is now also focusing on fossil fuels again in industrialized countries that want to free themselves from dependence on Russia.

The federal government is also positioning itself: during his trip to Africa in May, Chancellor Olaf Scholz (SPD) campaigned in Senegal for closer cooperation on the expansion of the gas infrastructure. It makes sense to "follow closely" such cooperation, this is a "common concern," Scholz said after talks with Senegalese President Macky Sall in Dakar. "We also want to do this with regard to the LNG issue and gas production here in Senegal."

At first glance, that sounds like a win-win situation: African gas can put Germany's energy supply on a broader footing. In return, Senegal could benefit if liquid gas terminals are built with the technical know-how from Germany.

In reality, however, the project is more complicated.

Experts doubt that supply bottlenecks with gas from Senegal can be bridged in the short term. Senegal could export gas abroad via a floating LNG terminal at the end of 2023 at the earliest. Initially, 3.4 billion cubic meters per year are planned. "This will not close the current gas gap," believes Franziska Müller, a political scientist at the University of Hamburg.

The expert on globalization and governance of climate policy is critical of the construction of a new platform off the coast of Senegal for other reasons too. She considers the extraction of natural gas to be a step backwards. “There is a risk of prolonged economic dependence on fossil fuel infrastructures. That would be a massive economic risk for Senegal.”

Germany actually decided at the world climate conference in Glasgow last November that it would no longer support any new coal, oil and gas projects with public funds from 2023 onwards. However, given the Russian war of aggression in Ukraine, this goal was revised at the G-7 summit in June.

In their final declaration, the G-7 states agreed that investments in gas should be possible temporarily, provided they are compatible with climate targets and that projects for the development of low-CO₂ and renewable hydrogen are then also integrated with the infrastructure. "In these exceptional circumstances, public investments in the gas sector can be appropriate interim solutions," it said.

Scholz reiterated the position of the federal government at the St. Petersburg climate dialogue: "We temporarily need new LNG capacities so that here and in many other countries around the world the lights don't go out for people at home and in the workplace." At the same time, Scholz emphasized that there were no new permanent dependencies of fossil energy sources - "not here and also not in the producing countries".

However, environmental campaigners fear just that - a long-term softening of Glasgow's climate targets and long-standing dependencies. The fact that "the self-appointed climate chancellor is traveling to the climate hotspot of Africa" ​​and promoting new gas drilling cannot be surpassed in terms of cynicism, said Fridays for Future activist Luisa Neubauer. "In order to still have a chance to stabilize the global climate in the medium term ... there can be no more new oil or gas fields."

The Senegalese Fridays for Future activist Yero Sarr also warned of environmental damage in his country, where a large part of the population is dependent on fishing and whose coast lies a large coral reef that is listed as a UNESCO World Heritage Site: "The Oil and gas exploration adds to the list of threats to our marine and coastal environment and the health of Senegalese people,” said Sarr. Sarr called the advertising of new gas wells by Scholz "brazen". Instead, the activist called for more support for the switch to renewable energy.

The International Energy Agency (IEA) also demands this. According to estimates by the organization, the climate goals can only be met if there are no more investments in coal-fired power plants and the development of new oil and gas fields worldwide. The IEA only allows Africa to continue to produce gas for the transition to the energy transition - albeit with one restriction: the fuel is intended to serve the industrialization of the continent.

Gas production would be designed primarily for export. Nevertheless, the traffic light, including the Green coalition partner, is behind the plan to look for new gas deposits abroad. "Unfortunately, it is necessary to temporarily pump more gas to escape Russian gas," said Jürgen Trittin (Greens), former Federal Environment Minister, the "taz".

If you want to do without the gas from Russia, you have to invest in new infrastructure. The prerequisite is that this happens within narrow limits and without lock-in effects, i.e. without creating dependency relationships. “If we don't want a lock-in, the write-off periods have to be very short. That is only possible with state guarantees.”

Political scientist Müller is not convinced by this argument. On the contrary: "The federal government would thus establish renewed dependencies." This applies in particular if new infrastructures are created for this, which first have to be profitable. "There is a risk of a renewed lock-in of fossil fuels, since gas supply contracts usually have very long terms in order to offer both partners planning security," agrees Steffen Haag, who is researching the topic together with Müller and has already carried out field research several times in Senegal Has.

"Exchanging 'commodities for money' leads neither to sustainable economic growth, diversification of the economy, nor to higher added value in the country." Commodity trading does bring rapid growth rates. However, this often goes hand in hand with an extreme political dependence on the extraction of raw materials.

Among other things, the Federal Government is already cooperating with Senegal on the construction of solar power plants. During his visit to Africa, Scholz confirmed his intention to work more closely together in the areas of solar and wind energy. According to the government spokeswoman, energy policy reforms are to be supported with the aim of decarbonising energy systems and increasing energy efficiency. What that means in concrete terms remains open.

In any case, the potential is great: According to the German Energy Agency (dena), Africa has more than 60 percent of the world's most suitable solar locations. In Müller's view, the economic advantages in the field of renewable energies outweigh the long-term: These created "four times as many jobs as is the case in the gas industry".

At the moment, however, the expansion is still faltering: "In all African countries together there are currently as many onshore wind and solar systems as Germany intends to install in a single year," said Andreas Kuhlmann, CEO of dena. "The international community must therefore give Africa much more support in developing a sustainable energy industry and finally make better use of the continent's enormous potential."

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