Energy case study

CHAD - LEDC

Basic facts• Natural resources:

petroleum, uranium, natron, kaolin, fish (Lake Chad), gold, limestone, sand and gravel, salt

• Total renewable water resources: 43 cu km (1987)

• Environment - current issues: inadequate supplies of potable water; improper waste disposal in rural areas contributes to soil and water pollution; desertification

Low energy consumption

• A developing country in N. Africa• Politically unstable• One of the poorest and most corrupt

countries in the world• Energy consumption is very low at 0.005%

tonnes of oil equivalent per person (average consumption in the EU is 3.8 tonnes)

• 80% of the population live below the poverty line

Oil exports• Huge reserves of oil• TNCs (Chevron, Petronas and ExxonMobil) exports from

2003• Exported via pipeline through Cameroon• Pipeline part funded by world bank if 80% of revenue was spent alleviating – CHAD

government did not keep to this agreement. “Oil revenues are secured for decades to come. The World Bank financed Chad-Cameroon pipeline has an estimated lifetime of 25 to 30 years. By 2030, however, Chad should be in a socio-economic position to invest in the infrastructure needed to keep oil flowing into world markets. If funds are properly managed, that is.

To obtain World Bank guarantees for the pipeline making oil exports possible, Chad had to agree to a transparent oil sector and earmarking 80 percent of government's oil revenues to fight poverty. This includes improved infrastructure and funds allocated to health, education, rural development, the environment and other social services.

However, "concerns that revenue from oil exports will fund military expenditures rather than needed social programs continue to date," also notes the US government report. Chad has been politically unstable since its independence and corruption, army interventions, ethnic strife and civil war always poses a risk to the current good outlook for socio-economic development. “

• Oil is an important source of income “Oil gives Chad 40 percent GDP growth afrol News, 22 December 2004 - The projected growth in real GDP in Chad this year is set at 39.5 percent. Chadian per capita income is even expected to double by 2005, as the full impact of oil exports is noted. But this will only be possible if the fragile social and ethnic peace can be maintained.”

Importing oil• Oil - Imports: 1,316 bbl/day (2004)• According to https://www.cia.gov/library/publications/the-

world-factbook/print/cd.html • Can’t use it’s own oil as doesn’t have its own refinery• Has to rely on imports from Cameroon and Nigeria• China National Petroleum Corporation appears to conduct

much of its business in impoverished countries in association with Petronas (controlled by the government of Malaysia) - e.g. in conflict-torn Chad.

• Cost of importing energy is expensive and most Chadian’s cannot afford it (only 2% of the pop. Have access to electricity)

• Poor transport systems mean delivery problems and shortages

• Importing oil is expensive and doesn’t meet the needs of the people because it’s unreliable.

• Less than 2% of Chad ’s population has access to electricity, and most of the population relies on wood for fuel requirements, this being a major contributor to deforestation.

• The majority of Chadians with access to electricity reside in N’Djamena, where the country’s only major power station (22 MW) is located. Only 9% of households in N’Djamena have electricity.

• The high cost of importing petroleum to fuel power generation makes Chad’s electricity prices among the highest in the world. World Bank loans to develop the electricity sector have focused on increases in sustainable energy ($5.3 million) and improvements in equipment renovation ($55 million)

Biomass

• 90% of Chad’s total energy

• 98% household energy

• No control over wood exploitation

Household Energy Project (1998)

• NGO’s educate local people about conservation• Village resource management schemes limit

amount of wood being cut down and charging people for collection

• Villages have ownership for resources; allows them to make money from wood so it makes it more of a valuable resource to conserve

• Improving energy use in homes by introducing more efficient cooking stones that use less fuel that open fires

• Only operates in 100 villages near the capital city.

• Chad’s energy supply isn’t sustainable• Oil policy doesn’t help meet it’s energy

needs as oil is non renewable• Biomass can be managed sustainably• Household energy project could help to

make biomass more sustainable if the policy was implemented in more countries

• Has to be less political corruption and more stability in the government