Pipeline To Success? Analysing Africa's Expanding Energy Network



Tim Haïdar
11/30/2011

Africa has a number of significant pipeline projects in various stages of development as the demand for fuels increases and countries look to collaborate for a more secure and diverse energy supply.

Branching out - pipeline expansion in East Africa

East Africa Community permanent secretary, David Nalo, recently revealed construction will soon begin on a 550 km pipeline linking Dar-es-Salaam-Tanga in Tanzania and Mombasa in Kenya to boost supplies of cooking gas.

Commenting on the plans at a summit earlier in the year, Patrick Nyoike, the permanent secretary in Kenya’s Ministry of Energy, noted: "It is expected the project will contribute to the reduction of energy costs and shield power generation from variability of weather and international crude oil prices.

Projects like this are being spurred on by the discovery of large quantities of natural gas in East Africa. Seven fields have now been discovered offshore Tanzania, with more than 50 hydrocarbon fields at various stages of development, All Africa reported.

Work is also currently being undertaken on the development of a pipeline between Kigali, the capital of Rwanda, and Bujumbura, the capital of Burundi.

The African Development Bank is currently funding a feasibility study into developing this section of the pipeline, which would be a continuation of the already operational structure between Eldoret in Kenya to Kampala, Uganda's capital city.

Nyoike said: "The plan is to link Kigali by a pipeline from Kampala, which will allow petroleum products to be accessed from the planned refinery in Uganda, as well as the existing refinery in Mombasa and international markets."

Pipeline security and the scourge of third party intervention

All of these projects will require serious consideration in the one area that continues to cost companies operating in Africa big money – security.

Pipelines in Africa are subject to the same operational risks as those in Europe, the United States and Asia, but also happen to be situated on a continent where the oil and gas industry struggles with the incursion of third party intervention on a daily basis.

Crude oil theft and illegal refining in the Imo River region of Nigeria lost the joint venture between Shell and Nigerian National Petroleum Corporation over $166 million (£106 million) in the two months between September and November, Business Day reported.

An upsurge in acts of sabotage caused the eventual shut down of the field, leading to the calling of Force Majeure on exports from the region.

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In September alone, 16 oil theft points were found in the Imo River field. Ten additional oil bunkering incidents in the Eastern Niger Delta have been discovered since the field was closed at the end of August, with four of these reported in one stretch alone on the Obigbo North delivery line at Komkom and Ogale.

Nigeria's State Security Police also arrested three people in early November allegedly responsible for an attack on an AGIP pipeline.

A spokesperson said the three were suspected of undertaking the explosion, adding:"The attack was carried out to coerce Nigeria AGIP Oil Co. to contract the surveillance of the pipeline to them."

Pipeline attacks in North Africa

Elsewhere, Egypt's oil industry was also forced to admit the pipeline to Israel and Jordan was hit with a double attack in November, marking the seventh time it has been targeted since February.

Mark Heller, a research fellow in regional politics at the Institute for National Security Studies at Tel Aviv University, told Bloomberg the repeated interruptions in supply are likely to affect the desirability of Egyptian exports.

"The continual pipeline bombings are going to make both Israel and Jordan think more seriously about diversifying their energy supplies, since the Egyptian gas is now clearly an unreliable source," he said.

On a regional level the probability and frequency of attacks occurring clearly differs, with some areas proving more secure than others and Nigeria providing a particularly dramatic example.

However, security is a consideration pipeline developers cannot afford to ignore, particularly as oil and gas companies ramp up production in the promising areas in East Africa.