00:00The conflict in the Middle East has caused fuel prices to rise amid oil and gas supply disruptions.
00:06For African economies, the impact is clear. Fuel imports are now more expensive, raising
00:12transport costs, food prices and household budgets. Against that backdrop, a new player
00:18is emerging to address the challenge. Africa's richest man, Aliko Dangote, recently said his new
00:24650,000 barrel-a-day refinery in Nigeria, has begun exporting refined petroleum products to other
00:31African countries. You might say that's a step in securing Africa's energy needs, but there's more
00:50to it. Welcome to The Flipside. Many leaders, including the United Nations Deputy Secretary
00:57General Amina Mohamed, were quick to applaud Dangote for stepping in.
01:01I hope that when we go back that we can continue to talk to the partners that will partner,
01:06the countries that should partner with the Dangote industries.
01:09Yet on the streets of Nigeria, some were not so keen on the idea of Nigeria sharing its oil supplies.
01:24How did the continent, though, find itself in such a vulnerable position? Africa produces a lot of
01:31crude oil, but refines little of it. Since 2005, it has been a net importer of petroleum products. By
01:392021, four countries – Egypt, Algeria, South Africa and Nigeria – made up around three-quarters of
01:46Africa's refining capacity. Four countries refining oil for nearly 54 countries. That's a massive
01:53challenge. For decades, Africa's crude oil was exported cheaply, refined abroad, then re-imported as
02:01expensive petrol, diesel or jet fuel. Result? Even oil-producing countries like Nigeria
02:07Korea have seen sharp rises due to the global market shocks. Historically, when we had colonial rule,
02:17the idea was for exports. The oil production system was primarily done to export crude.
02:24That legacy was never fully dismantled. And even subsequently, when we had refineries,
02:31there was poor maintenance, a poor maintenance culture. Regularly, energy infrastructure is supposed
02:39to be maintained from time to time, coupled with corruption and poor corporate governance.
02:45The scope of this challenge extends beyond Nigeria to South Africa.
02:49The dependency on liquid fossil fuel is very high. And even more now because it's lost a fair amount of
02:59its refining capacity. So it even has to import diesel. Now, Dangote's refinery might have come
03:05at the right time. But experts say it alone won't solve Africa's energy security. The Dangote initiative,
03:12and hopefully many will follow on the back of that, it does not organize itself to increase the fuel
03:21security for the countries around it. And that's because we're so far behind competitors in the Middle
03:27East, Asia or Europe. Those regions built up their refining capacity decades ago. The Middle East already
03:34had a lot of crude and could integrate refining rather than African countries taking the risk of building
03:45down refineries. They thought it was more efficient to do it that way. One thing is clear. The conflict
03:51in the Middle East has exposed the risks of Africa's dependence on distant fuel suppliers. People are
03:57beginning to rethink the entire oil production structure and the the entire petroleum regime in
04:05their own countries. For some though, the shock reinforces a broader lesson. Energy security goes
04:12beyond fossil fuels. If it was just highly visible before, it is shouting at you now around the direction
04:20in which you move. And if you refuse to listen to it, there's a huge price to be paid. That
04:26means African
04:26countries exploiting both renewables and locally sourced energy. And that's the flip side.
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