The first pillar of our sustainability strategy is to promote socio-economic prosperity within the countries in which we operate
Our approach
Our ambition in the first pillar of our sustainability strategy is to make a positive difference to the socio-economic prosperity in our host communities and countries. Extreme poverty alleviation is the most important issue facing African countries today, with 36% of sub-Saharan Africans classified as suffering from extreme poverty6.
The World Bank also calculates that only 57% of Africans have access to electricity7. Studies have shown the strong relationship between power consumption, income levels and broader human development metrics; ceteris paribus, the higher a country’s per capita power consumption, the higher GDP per capita, and the higher those human development metrics are expected to be.
Therefore, energy poverty alleviation would substantially contribute to solving Africa’s extreme poverty problems. That is why we focus on providing our host countries with energy to drive socio-economic prosperity. We have been exploring how to best evaluate and quantify robustly the socio-economic impacts of our core business activities in the countries in which we operate. We plan to progress with this work in H2 2024.
Using energy to drive prosperity
Savannah supplies gas to enable approximately 20% of Nigeria’s thermal power generation capacity, playing a strategic role in providing a reliable supply to power stations and industrial users. In 2023 we signed new and extended gas sales agreements with five customers and delivered gas to nine customers in total.
In Niger, we are participating in a wider energy sector project which is forecast to contribute up to 13% of Niger’s GDP by 2025, and expected to accelerate economic growth by an estimated 27% and exports by 89% in 2025 vs. 2023 levels4. We expect to tie our planned production from the R3 East Early Production Scheme directly into the new Niger-Benin export pipeline, which became fully operational in Q2 2024.
In March 2022, we announced plans to build and operate Niger’s first wind farm, which is expected to increase Niger’s on-grid national electricity consumption by up to 22%, create
500 jobs in the construction phase alone and reduce the cost of electricity for Nigerien citizens. This work continued to progress throughout 2023 and a number of key technical studies were completed.
Post-year end in February 2024, the Environmental and Social Impact Assessment Scoping Study was submitted to the Niger National Environment and Assessment Office.
Making a local and regional difference
We advocate promoting local employment and development opportunities to drive local socio-economic prosperity. In 2023 we employed 175 people in Nigeria (2022: 177), of whom 99% were Nigerian nationals, and in Niger we employed 18 people (2022: 17), all of whom were Nigerien nationals. Through formal training and on-the-job development with experienced Savannah employees, we continue to build the capability of the local workforce in our host countries.
Savannah operates a global procurement policy across the Group as we have a significant supply chain impact. In 2023, we spent US$23.5 million (2022: US$22.9 million) with local contractors and suppliers. The policy ensures all our contractors and suppliers meet the same standards and practices for all our operations, with some exceptions for specific local regulations. This approach affords opportunities for shared optimisation across regions but also enforces high standards because we recognise that the nature and context of our business exposes us to the potential risk of fraud, bribery, modern slavery and human trafficking.
In our centralised vendor performance management system, we actively monitor the performance of all our suppliers and require re-qualification every four years.
Our annual reporting metrics
- Total Contributions(d) in US$.
- Social impact investment in US$.
- Payments to local suppliers and contractors in US$.
2023 performance
- Our Total Contributions(d) to our host countries were US$52.0 million in 2023.
- Our social impact investment in 2023 was US$0.4 million.
- We spent US$23.5 million in 2023 with local suppliers and contractors in Nigeria and Niger.
2024 objectives
- Develop targeted impact metrics that reflect Savannah’s expanded portfolio and that further measure Savannah’s contribution to socio-economic prosperity in our host communities and countries.
Learn more about our efforts to promote socio-economic prosperity
1. Source: Fitch Solutions
2. Total contributions to Nigeria and Niger defined as payments to governments, employee salaries and payments to local suppliers and contractors. Where total contributions refer to the period 2014–2022 they include contributions to Nigeria during the period pre-acquisition of the Nigerian assets by Savannah.
6. Source: World Bank Gapminder, 2022.
7. Sources: World Bank, IEA Africa Energy Outlook, 2022.
4.Source: République Du Niger, Politique Pétrolière Nationale, December 2019.
