By Agency Report
Africa must invest $9.3 billion to expand fuel-transportation infrastructure to avoid supply disruptions as demand grows, according to Puma Energy, one of the continent’s biggest fuel retailers.
The continent has a sparse network of fuel pipelines that make up only a fraction of what’s been built in the US. Fuel distribution units of traders including Vitol Group see Africa as a place of transportation growth that’s reliant on gasoline and diesel — which will require investment.
“You might have the right price, the right regulation, but if your ports are congested, if the roads are congested, if the pipeline leaks, if there is no storage, you will not have energy security,” Fadi Mitri, head of Africa for Trafigura Group subsidiary Puma, told a conference in Cape Town.
Demand for hydrocarbon fuels will grow 56% in Africa by 2040, while a lack of fuel-storage facilities and port access will create bottlenecks and slow the pace of supply, said Mitri, who cited new research by Puma and consultant Citac.
While companies and banks have faced increased scrutiny for lending to new African fossil-fuel projects, they’re also under pressure to help fund nascent oil and gas fields as governments defend the right to develop their resources on a continent that accounts for a fraction of greenhouse gas emissions.
Mitri cautioned that any new projects should complement each other, rather than compete.
“They will need master planning,” he said. “They will need coordination.”
Source: Bloomberg
