Oil and Gas Sector Accounts for 20% of Africa’s GDP—Atampugre
By Modupe Gbadeyanka
The Director of Resources and Energy, Absa Securities, United Kingdom, Mr Camillo Atampugre, has stressed that despite many advanced economies of the world rooting for cleaner energy, the oil and gas sector remains a key channel of revenue for most African countries.
According to him, the industry accounts for an estimated 20 per cent of the continent’s Gross Domestic Product (GDP) and in places like Nigeria and Angola, it contributes 70 per cent of the overall foreign exchange (forex) inflows and 60 per cent of government tax revenues, while driving growth impacts that reverberate across the labour market, the security and exchange system and other downstream segments.
He, therefore, submitted that developing a social investment plan that utilizes proceeds from the oil and gas sector remains critical to stimulating impactful growth across the African continent.
Mr Atampugre noted that Absa investment’s focus aims to drive sustainability and advocate for a wider pivot to the Environmental, Social and Governance (ESG) initiatives across the oil and gas sector.
He advised that considering the overt contribution of the oil and gas sector to the African economy, a strategic approach to the adoption of cleaner energy is advisable. This is to forestall a sudden snap that could hamper the attainment of the shorter to medium terms growth projection on the continent.
He further pointed out the various responsible steps being taken across the continent to ensure compliance with the various ESG requirements as regard achieving a gradual transition into cleaner energy and repositioning the oil and gas sector to sustain a balanced socioeconomic impact along the trajectory.
“Recognising the strategic role of the sector in their economies, places like Angola and Nigeria have taken steps to improve Governance elements.
“In Angola, the President has put significant focus on cleaning up the image of the sector and courting foreign investors while the Nigerian national assembly recently passed the Petroleum Industry Bill which is aimed at making it easier for investment into Nigerian oil and gas operations,” Mr, Atampugre explained.
Citing the social investment roles being played by the major operators in the oil and gas sector he said, “For instance, oil major Shell has played a pivotal role in investing in healthcare infrastructure to help in the fight against the likes of Ebola and HIV as well as being a major party in the first community-based health insurance program in the country.
“Similarly, dual-listed oil and gas player Oando has trained over 2800 teachers and financially supported 88 schools via its Oando Foundation.”
He referred to the framework for achieving a faster transition to cleaner energy. Amongst them is the renewed emphasis placed by government and operators in the energy sector in Africa to implement regulatory and social investment strategies that are aimed at alleviating poverty and providing access to affordable energy.
Mr Atampugre concluded that Absa, a specialist investment bank, was committed to helping the continent achieve its socioeconomic growth agenda as well as provide guidance that ensures compliance with various ESG goals.
“As an investment bank that specialises in funding oil and gas projects in Africa and has a deep understanding of the continent, we look forward to working on projects which tick all three of the ESG elements in a socially conscious manner,” he said.