Power shifts in Equatorial GuineaSeptember 20, 2018
Nicolás Nguema Bibang Nzang, general director of Sociedad de Electricidad de Guinea Ecuatorial (SEGESA), talks to TOGY about how the company’s new developments will ensure year-round energy security and how the country can benefit from surplus power generation. SEGESA is responsible for supplying Equatorial Guinea’s electricity and operating the country’s power infrastructure.
• On diversification: “Oil is a resource that will run out. We have to start to look for other things. It won’t all go at once, but it will decline over time. There will still be income, but not the level of income that we had at the beginning. Therefore, we need to supplement that with other types of income from activities such as selling power.”
• On the power matrix: “With declining oil production in the fields, gas production will also decline. At some point down the road, unless we find more reservoirs, we might not have fuel gas. We are very conscious of that, and our alternatives are solar and hydropower.”
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How do SEGESA’s operations contribute to the government’s economic diversifications goals?
Oil production peaked and has started to decline slightly, though there are new players that will be doing some exploration. The government has been working on diversifying sources of income. One of those sources, which will not be completely dependent on the oil sector, will be selling power to other countries.
Oil is a resource that will run out. We have to start to look for other things. It won’t all go at once, but it will decline over time. There will still be income, but not the level of income that we had at the beginning. Therefore, we need to supplement that with other types of income from activities such as selling power.
We have projects planned with Cameroon and Gabon. Those will allow us to be able to sell our surplus energy, so we can continue with obligations such as construction and other electrification projects that are either ongoing or coming down the pipe.
This is a start. The plan is to install different connection points all over Africa that will provide additional income to Equatorial Guinea.
Those areas to which we are trying to provide electricity do not have access to the national grid; it doesn’t reach them. They might be using generators. I would think that there is demand. I can’t tell you how much power they need because we’re still in the process of doing the studies and understanding the technical requirements, and then the economic evaluation will follow.
How did the oil price downturn affect SEGESA?
It has impacted SEGESA’s operations, but not in terms of energy production, because energy production on the island is mainly based on fuel gas. We still have enough fuel gas to generate power with turbines and we have enough water to generate hydropower. We use diesel in some locations as well.
A couple of years ago, a significant number of companies operating here were SEGESA’s customers and they were paying their bills. As activity levels have decreased, those customers are no longer there. To a certain extent, that will have an impact on annual income because the pool of customers has diminished. This may lead to a larger energy surplus, which is why we are working with other countries to sell energy beyond our borders.
Another good piece of news is that the oil price is slowly recovering; the last time I checked, it was around USD 70-80 per barrel. At the same time, the country also has some exploration going on in the continental area. This means that if we find commercial oil, we can increase production and have bigger volumes to sell. That would also generate more income with the price increase. Selling 1 million barrels at USD 76 per barrel versus selling it at USD 45 per barrel makes a big difference.
Are you optimistic about future market conditions overall?
I am very optimistic. With the current government emphasis in diversifying our economy, the increase in oil price and ongoing exploration, I am sure market conditions will improve.
How does SEGESA ensure sustainability?
Clean energy comes with an environmental aspect. We basically want to minimise the use of fossil fuels and use more technologies related to solar and hydro energy, which is better for the long term and causes less environmental contamination. Our two main power plants in the continental area are hydro plants: Djibloho and Sendje.
We would like to transform our energy sector to be based on resources that are always there for us and that are sustainable. With declining oil production in the fields, gas production will also decline. At some point down the road, unless we find more reservoirs, we might not have fuel gas. We are very conscious of that, and our alternatives are solar and hydropower.
How much of your power is generated from fossil fuels and renewables?
In Malabo, maybe more than 90% of power comes from fossil fuels because all the power on the island comes from the turbogas plant, which powers almost the entire island. We have some small areas where the grid does not cover, so we also have generators that use diesel.
On the mainland, most of the power is hydropower. At this time, Djibloho provides power for most of the mainland. We would like everything to be hydro or solar. Given that the mainland has a much higher population, I would say that 50% of power country-wide is clean because it is hydro.
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