IVORY COAST
Leaving 2010-2011's civil unrest behind, hydro-electricity, together with conventional methods of production, make up the bulk of Ivory Coast's energy production; it is a modest oil producer, but lacks the resources to exploit the much greater reserves that exist offshore, which the previous civil unrest had not helped, but oil major interest – and licences –continue to grow. That said, the government is aware of difficulties in electricity production which have added to that problem; having taken steps to improve capability, including wholesale reform of the state electricity and gas companies in April 2012, merging their functions, and setting the groundwork for multi-billion dollar investment in the sector. Hydroelectricity is also more prominent, with the production of a new dam generating 580MW. New Energy and Mining Codes, proposing significant changes, are both being drafted, completing the structural reforms – but also requiring commercial scrutiny.
MADAGASCAR
No stranger to internal unrest itself in recent years, Madagascar's potential to exploit its energy sources is undercut by the same issues as many Francophone states, leaving it dependent on traditional energy sources, withthe usual forestry impacts. Water and electricity services are provided mainly through state-run utility, JIRAMA, which has undergone a rolling programme of utility and sector reforms through to the present day to meet supply difficulties. Oil remains under exploited, as does gas, recent legal disputes have been settled amicably. The country is also investing in solar and wind-power, the latter, heavily, with associated tax and legal benefits.
SENEGAL
Senegal – gradually moving from domestic consumer to regional producer –shares many of the same challenges as its neighbours above, but has changed its energy policy, to restructure the electricity distribution network, and to develop the oil and gas sector further, including developing reserves. It has considerable potential for the latter, and is actively promoting petroleum exploration, which oil companies are happy to support. Gas also possesses similar potential.
With a new president familiar with such issues in Macky Sall, moves to counteract civil unrest at electricity shortfalls and to grow that sector have followed. The government has restructured the electricity, oil and gas markets, with associated legislation in each, whilst passing other legislation encouraging renewables. It has also created a number of state-backed companies intended to support greater participation in the energy sector.
About the author:
John Ffooks has particular experience in infrastructure, utility and natural resource investments in the developing world and the financial structures associated with them. John has lived in Madagascar for almost ten years, starting his own firm in 2007. He is intimately familiar with the specific legal and business cultures of Francophone Africa.
John W Ffooks & Co
Tel: +261 20 224 3247 / +44 787 656 0873
Email: john@jwflegal.com
