Can you introduce Savannah Energy and provide an overview of your assets, particularly in Nigeria?

Savannah Energy is a British independent energy company focused on the delivery of projects that matter in Africa, specializing in upstream and midstream hydrocarbons, and large-scale renewable energy projects. 

In Nigeria, Savannah has two large-scale oil and gas fields, and our Accugas midstream business, comprising a 200 MMscfpd processing facility and a c. 260 km pipeline network. We currently supply gas to enable approximately 20% of Nigeria’s thermal power generation capacity.  In Niger, we have license interests covering approximately 50% of the country’s main petroleum basin, the Agadem Rift Basin, as well as up to 450 MW of wind and solar projects. In Cameroon, we are progressing the up to 95 MW hybrid hydroelectric and solar project, and have a ~41% interest in the Cameroon Oil Transportation Company. We have also announced a US$1.25 billion acquisition of hydrocarbon assets in South Sudan, and a US$61.5 million acquisition in Nigeria, consolidating our interests in the Stubb Creek field.

Gas production is a significant aspect of our business in Nigeria. Last year our gas production amounted to approximately 145 MMscfpd, with plans to increase it further following the installation of compression facilities this year. 100% of the gas we produce in Nigeria is consumed domestically. Since we announced our intention to acquire Accugas in late 2017, the volumes of gas transported, the number of significant customers served, and our contribution to thermal power generation in Nigeria have each more than doubled.

Does the significant domestic consumption of the gas you produce in Nigeria pose challenges considering the current currency fluctuations?

Operating in an environment where we face daily fluctuations in currency exchange rates can impact our revenue streams. Our contracts are priced in dollars, so currency fluctuations can lead to delays and potential financial discrepancies during payment processing. That said, over 90% of our current contracted revenues are with customers providing investment-grade credit guarantees. However, we remain optimistic about Nigeria's prospects and believe that overcoming these hurdles will ultimately lead to opportunities for reinvestment and growth in the gas sector, especially considering the increasing demand for gas in the country's energy landscape.

What role will gas play in Nigeria's energy security and its eventual transition to a green economy?

I think that Nigeria does not have an energy security problem like Europe does – we produce more hydrocarbons than we consume. From my perspective, energy security encompasses not just the availability of energy but also its reliability, affordability, and sustainability. In Nigeria, while the narrative often revolves around megawatt consumption figures, such as the commonly cited 4,500 MW, the reality is far more complex. Nigeria's actual energy consumption far exceeds this figure, with an estimated demand of around 20,000 MW. However, a significant portion of this demand is met by decentralized, off-grid sources, primarily diesel and petrol generators. This reliance on inefficient and polluting energy sources underscores the need for a transition to cleaner alternatives, such as gas, which is cleaner than traditional fossil fuels like coal, as well as renewable energy.  

Savannah Energy recognizes this and is actively contributing to Nigeria's energy transition. For example, our Stubb Creek acquisition secures significant additional feedstock gas for the future. We also have up to 696 MW of large-scale renewable energy projects in motion across Africa, with a short-term target of up to 1 GW+. 

If Savannah Energy were to increase its gas output significantly, would the main limitation be the inefficiencies in Nigeria's grid infrastructure?

It is evident that Nigeria's grid infrastructure poses significant challenges. Currently, the grid is outdated and inefficient, leading to congestion and limitations in reaching all parts of the country. However, I believe these issues can be addressed within a relatively short timeframe by focusing on upgrading and redesigning the existing infrastructure. 

What are Savannah Energy’s key priorities and trajectory for the coming years?

Our foremost priority remains the safety of our operations, employees, and the communities we serve. I was particularly proud last September to announce the recording of one million hours without a Lost Time Injury across our Nigerian operations.

Our strategic focus for the coming years is on optimizing our existing assets to maximize performance, while growing the business, both organically and through new acquisition opportunities.