Banks Now Targeting Renewable Energy Transition – Sahara Group

By Tolulope Oke

The Chief Operating Officer of Sahara Energy, Henry Menkiti, has revealed banks are now targeting investments in the energy transition sector.

The transition to renewable energy sources from fossil-based energy production and consumption is known as the energy transition. The hunt for energy sources devoid of carbon emissions from fossil fuels, such as coal, crude oil, and gas, is what propels the process.

Speaking at the first edition of Sahara Group Media Thought Leadership Series, held at the group’s corporate head office in Lagos, Henry explained that the energy transformation that is reshaping industry operations should be led by oil and gas firms. If they don’t, other players, like banks, will take over control of the voyage.

“Banks are now saying ‘We will not fund what you are doing unless you show us what you are doing about emissions,” he said.

He explained that in order to do this, the private sector must actively participate, with the government creating favorable conditions through legislation and incentives.

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Given the nation’s abundant gas reserves, which should act as the transitional fuel as Africa’s top oil producer marches to the intended goal, the shift will be less disruptive.

Gas poses a number of challenges, including the need to prevent leaks during exploration and production, the need to mask its offensive smell using specialized deodorants so that it can be used as transitional energy, and the amount of money needed to build the necessary infrastructure for its exploitation. Therefore, any company looking for gas will need to make substantial investments, Henry noted.

The response of Nigerian oil and gas corporations to the unfolding shift should be based on how quickly the demands of energy customers in industrialized nations are changing. He asked what the oil producers should do in response, predicting that the country’s existing oil customers will no longer require it in 50 years.

According to Menkiti, the switch to renewable energy sources does not spell the death of fossil fuels; rather, it indicates that demand will decline.