BY DAYO ADESULU
African Energy Chamber’s Regulatory Affairs Committee has called for less red tape and regulation that reflects post COVID Market realities.
This is just as the African Energy Chamber’s Regulatory Affairs Committee (EnergyChamber.org) held its first meeting of the year to discuss regulatory matters that impede the African energy sectors growth and to make proposals on progressive regulation fit for the post COVID recovery.
The purpose of a regulatory committee is to identify and track global regulatory trends and make propositions to African regulators on how these could be adopted and adapted to improve the operating environment in Africa’s energy sector.
Through its work, the Regulatory Committee was able to assist the Chamber in crafting propositions that led to some changes in regulations on how to soften the impact of COVID-19 on energy companies in a number of countries at the start of the pandemic in 2020.
The Chamber’s Regulatory Committee took into account how difficult it is for investors, but also for governments to adapt to the new normal. The Committee’s discussion unpacked the importance of aligning regulation across the region.
Key outcomes of the meeting included proposals to promote;
- sensible and market-driven local content regulation
- Environmental regulations that are in line with international standards but not inhibitive to new exploration projects
- Constant exchanges between regulators in Africa to create awareness for alignment and also exchange of best practice
Bill Drennen, President, and CEO of WTD Resources, a board member on the committee highlighted the importance of continuous dialogue and seminars between the Chamber and regulators.
According to him, the aim of regulation should ultimately be to regulate the industry in a way, that allows maximum investment to flow into the sector and be productive and profitable for all stakeholders. “The chamber has a leadership position on the continent and is therefore perfectly positioned to drive positive change in the African Energy sector regulatory space.”
Additionally, fellow committee member Nicolas Bonnefoy, Partner at ASAFO & Co added that: “Many African countries have severe constraints such as their slow administrative processes which have delayed new regulations being introduced that will render these states competitive in a post COVID era”.
According to Mr Bonnefoy, States often implement new policies and new regimes without taking into consideration market realities and competing regimes globally, often leading to no definite positive outcome. “The Chambers’ job right now is to engage with regulators, and where they might need expertise that is not in-house, offer the expertise that is available at the AEC”.