"Understanding Natural Gas and LNG Options" Handbook
Electricity drives opportunity in the modern world. Industrial activity and critical infrastructure from telecommunications to transportation rely on electricity – access to reliable and affordable energy is essential to virtually every aspect of our increasingly dynamic and interconnected world. At present, however, about two-thirds of citizens in sub-Saharan Africa lack access to electricity.
The Power Africa Initiative, started in 2013 and reinforced by the Electrify Africa Act passed by the U.S. Congress in 2016, addresses this challenge by bringing together the thoughts and expertise of technical and legal experts, the private sector, and governments from around the world in partnership to build human capacity and promote projects that will bring electric power to millions of people in Africa, as well as promoting jobs and economic growth in the U.S. and Africa and encouraging investment from international partners in Africa and globally.
Natural gas development and uses are important components of a clean energy future and could enable public entities and private companies to generate more power from abundant indigenous resources or from imported gas (in the form of LNG or pipeline gas) – building deeper and broader gas markets for the benefit of all. For those countries with resource potential, developing LNG can provide clean fuels for generating electricity, producing industry feedstocks, and fueling industries while also generating badly needed revenue from exports of gas as LNG. LNG trade can also promote growth through participation in regional and global markets and from related investments in LNG importing countries.
With these challenges and opportunities in mind, the U.S. Department of Energy (DOE) Offices of International Affairs and Fossil Energy with assistance from the U.S. Energy Association and funding from USAID/Power Africa created an LNG handbook, “Understanding Natural Gas and LNG Options”. This is the third volume in Power Africa's "Understanding Series" of handbooks, outlining best practices for developing energy projects in sub-Saharan Africa.
This handbook focuses on the factors that exporting or importing nations on the continent need to consider when making decisions about natural gas development in general and more specifically the development of liquefied natural gas (LNG) projects related to the export and import of LNG. These natural gas projects are necessary to monetize resource development, expand access to energy resources, promote investment in Africa with foreign partners, and promote intra and extra-regional gas trade.
Power Africa is partnering with the U.S. Department of Energy to help build human capacity in the region to realize - and accelerate – natural gas development and import projects. This handbook is intended to inform decision-makers considering options to develop or import natural gas resources. We hope this handbook will help decision makers develop LNG export and import projects in Africa.
In preparation for drafting this handbook, DOE sponsored a series of workshops with African government counterparts and private sector LNG experts including industry experts in project development and management, operations, law, and finance. These workshops identified broad factors that promote successful LNG projects and also identified a network of interested experts, some of whom were able to join us as authors of the handbook, and others who were unable to join, but whose insights were valuable to the success of our effort.
A diverse group of global experts created this handbook that we hope can help to create a shared understanding between government officials and companies of technical, commercial, and economic factors that will spur investment in Africa. This handbook focuses on key factors for assessing LNG projects while also touching on commercial models, infrastructure models, and the outlook for LNG markets and emerging regional trade opportunities. The handbook does not promote any specific business model, but rather is a reference document that we hope will help to facilitate better communication between partners considering projects.
The group of experts, all whom contributed their time on a pro-bono basis, included contributors from governments, development banks, consultants, academics, and international oil companies.
The goal of this handbook is to provide the reader with insight not only into those issues that matter most to them, but also a glimpse into the perspectives and motivations of other stakeholders. Such insight can help parties reach agreement and limit delays resulting from misunderstandings and adversarial positions.
The current version of the handbook can be downloaded here.
DOE’s Offices of International Affairs and Fossil Energy are exploring replicating and expanding the Handbook for other emerging Natural Gas and LNG markets. The first edition of a Global Handbook without tailored regional content is currently available at “Global LNG Fundamentals”.
For our French speaking partners, Power Africa recently facilitated a translation of the original LNG Handbook which can now be downloaded from the following link - “Comprehension Options du gaz naturel et du GNL”.
You can also download the slides outlining the thought process that emerged from our series of workshops here.