Africans look to biofuels to cut OPEC price burden

Even before world oil prices rose again after OPEC members pledged a production cut last Thursday, poor countries were looking to the hardy Jatropha bush to counter the crippling impact of energy costs that some compare to the ravages of HIV/AIDS.
The Jatropha, which has the unusual virtue of thriving in arid areas, is regarded as a potential source for biofuels produced from agricultural crops, which several African countries are considering to cut their growing bill for oil imports.

`For us, it's about dealing with a silent killer, the energy crisis, which is hitting us month after month,` Zambia's energy minister Felix Mutati explained at a recent United Nations meeting on biofuels.

`AIDS kills visibly, energy kills indirectly,` added the minister, who comes from one of the countries hardest hit by the AIDS pandemic.

Recent oil price increases have effectively wiped out the annual 150 million dollars in debt relief Zambia obtained three years ago alongside bolstered development assistance, according to Mutati.

`The commitments were high, delivery somewhat slow. This third factor called energy was perhaps overlooked,` he added. `Our efforts to reduce poverty, to increase security, are under threat.`

Senegal's government says the country's oil bill has more than doubled in the space of two years, from 159 billion CFA francs (320 million dollars) to some 425 billion expected in 2006 even though demand was stable.

`It's the only product where a group is allowed to meet and say they're cutting production and thereby raising prices. And we're subjected to the full brunt of it,` said Abdou Aziz Sow, Senegal's minister for Africa's development partnership (NEPAD).

Nearly half is flowing from Senegal into African oil-producing nations Sow underlined. Angola is due to join Nigeria in OPEC in January.

Senegal is regarded as one of the few countries likely to meet the UN's poverty-cutting Millenium Development Goals by 2015, but Sow warned that that target was under threat.

`If (oil) prices continue like this, I'm not even talking about the millennium goals. There won't even be a population left in Senegal,` he said, hinting at the exodus of west African migrants trying to reach Europe.

The UN Conference on Trade and Development warned in a report last month that the oil burden was forcing poor countries into renewed borrowing, potentially triggering a new cycle of debt.

`Countries must move to a more sustainable energy mix at the national, regional and international levels, and biofuels can be part of that mix,` said Lakshmi Puri, UNCTAD deputy director, while warning that they were not a full substitute to oil.

While oil is above 50 dollars a barrel, development of biofuels sourced from crop extracts is increasingly viable. They are also clean fuels with few carbon emissions, according to experts at the meeting organised by UNCTAD.

The major source of biofuel in recent years has been ethanol made from sugar cane, championed by Brazil.

The South American country has developed a huge cultivation, refining and distribution infrastructure, and a domestic market. Brazil's ethanol exports also increased nearly tenfold between 2000 and 2004 to 1.8 million tonnes.

Exports of vegetable oils with energy use such as palm oil, mainly from Malaysia and Indonesia, have also increased sharply, according to UNCTAD.

`Biofuels are likely to be produced in the equatorial belt of the world where most of the biomass can sustainably grow. Most of the least developed countries are there,` said Arsene Balihuta, Uganda's ambassador to the UN, who chaired the meeting.

However, subsistence crops in Africa -- where food is already short and fertile land is at a premium -- could suffer if land is diverted for energy use, UN experts said.

More irrigation would also put pressure on scarce water resources while food prices would suffer under competition for land, Puri cautioned.

Hence the interest in the Jatropha bush, which is already being transformed into biodiesel on a small scale in India. It is not edible and grows even in desert soils.

`With Jatropha, not only can I cultivate land which was not suitable for cultivation before -- and create the potential for jobs -- but I can also build the whole production chain that can trigger an industrial revolution,` Sow claimed.

Senegal is teaming up with the UN, Ghana and Mali to fund production, he added.

In Zambia, however, Mutati is looking for a `global fund like we have created for AIDS` to foot start-up costs for biodiesel in developing countries.

International Energy Agency chief Claude Mandil recently predicted faster growth in biofuel production over the next five years, saying it would remain a marginal `but rapidly growing competitor` to oil refining.

Based on existing projects, production is expected to grow from 700,000 barrels day in 2006 to at least 1.2 million barrels per day in 2011.

Brazil and the United States will continue to account for more than two-thirds of biofuels supply, according to IEA estimates.


Source: AFP