Northern Republics Reconsider Fossil Fuel Industry as Prices Spike

Originally published at: https://www.novosmundos.net/6927/northern-republics-reconsider-fossil-fuel-industry-as-prices-spike/

Otjomuise – After years of declining interest and tightening government regulations, the Union’s fossil fuel industry may soon experience a new lease on life as the European invasion of Iraq and anticipations of long-term systemic risk in the Middle East drive up fossil fuel prices.

This market shift poses difficult questions for the Otjomuise, Kavango, and Shona People’s Republics, who house much of the Union’s oil and gas industry and have a long and complex relationship with the sector. While the Shona People’s Republic has enjoyed a degree of economic success only surprised by some of the southern Republics, both Otjomuise and Kavango have historically lagged behind the other constituent states of the UAPR.

The Kavango People’s Republic has previously turned to fossil fuel production as a way to fund development, a decision which led to the Okavango Environmental Crisis in the 21st century. Production in Kavango has continued even amidst ongoing efforts to restore the Okavango Delta’s unique wetlands. In Otjomuise, the oil and gas sectors are far less politically fraught, as major operations are conducted in deep water fields up to hundreds of kilometers away from the coast. Even so, the industry here has been no less derided by environmental groups.

The importance of the oil and gas industry in the Union has declined over the past century as many aspects of life have turned to alternative sources of energy and government regulations in the aftermath of the Okavango disaster have limited further development with the aim of a full phaseout. Even so, fossil fuels continue to play an important role in a variety of industrial applications, and while personal automobiles have undergone near complete vehicle electrification, other areas have yet to catch up.

In the wake of Foreign Ministry warnings that European expansionism in the Middle East and North African regions is likely to continue, all three Republics have begun reevaluating their stances on winding down production within their territory. These moves have been encouraged by leadership in Maseru as previous plans to establish foreign suppliers are increasingly rendered unviable. 

Production off the coast of Otjomuise takes place in waters under the direct jurisdiction of the central government, which has already eased back limitations on further deep water development without the previously expected objections from local officials. In Kavango, similar measures are taking shape within the regional government despite significant opposition. Meanwhile, legislators in the Shona People’s Republic have begun holding debates on ending their own dismantling of the industry, though as of yet it is unknown whether the already well-developed region will take the opportunity to once again kickstart the industry.