CAPE TOWN/LAGOS - Near the tip of Nigeria's Bonny Island, an arrowhead speck of land where the Atlantic Ocean meets the Niger Delta, a giant plant last year produced enough liquefied natural gas to heat half of Britain for the winter. Most of it was shipped out of the country, with Spain, France and Portugal the biggest buyers.
Italy in April struck fresh deals to buy gas from Angola and the Republic of Congo, while Germany has been looking to secure supplies from Senegal. That's despite discouraging the use of gas and other fossil fuels around the world in pursuit of global climate goals, a case some European leaders made at the United Nations' COP26 conference in Glasgow last November.
Europe's awkward position was on display at the Group of Seven leaders summit last month. The world's most advanced economies walked back a climate commitment to halt financing for overseas fossil fuel projects, but indicated that exceptions would likely apply to projects that would allow for more shipments of LNG to their countries.
Many African leaders support boosting gas exports to help their cash-strapped governments, but they also want access to financing that would allow them to harness the fuel's potential to create domestic natural gas markets. European politicians argue the fossil fuels are a band-aid needed to get the bloc through the current crisis, so it can avoid shortages and blackouts that could weaken support for sanctions against Russia.
There's ample sunshine and wind in Sub-Saharan Africa, which collectively uses less energy than Spain, but little infrastructure to harness it. Developing countries also face much higher financing costs for green projects because they're seen as riskier investments. Adding to Africa's frustration is that rich nations have failed to deliver on a target to provide US$100 billion a year in climate finance that was supposed to have been met in 2020.
A recent spate of major discoveries has led to big private projects with fossil fuel giants including Exxon Mobil, BP and Shell spending tens of billions in Mozambique, Tanzania, Senegal and Mauritania to extract more gas for export. Financing from institutions such as the World Bank, International Monetary Fund and European Investment Bank for gas power projects has all but disappeared for climate reasons. There's also a worry from private investors that they could end up as stranded assets as the world tries to reach net-zero emissions in the coming decades.
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