Olusola Bello & THEODORA KIO-LAWSON
As the amnesty deal between the Federal Government and Niger Delta militants holds out hope of greater access to gas, government is collaborating with oil companies in a bid to achieve the target of one billion standard cubic feet of gas per day by the end of the year for domestic use.
Restiveness in the delta had stifled oil companies’ access to gas fields to power the emerging gas-fired power stations, thereby scuttling the bid to boost generation.
Virtually all the power plants have been shut down on account of gas availability, a situation that has made government realize that until access to gas supply is guaranteed, all targets on power generation may not be achieved. Since May 2009, the entire Chevron supply has been out as its facility was blown up.
“We were getting almost 200 million cubic feet from Chevron, but that is completely out now. Oben, Sapele is completely out,” David Ige, group general manager, strategy of the Nigerian National Petroleum Corporation (NNPC), said. Ige spoke at the AELEX 5th annual lecture series what the government has been trying to with the Gas Master Plan.
In the plan, government had reprioritised the economic growth of Nigeria anchored on gas, and first thing it did was to bring the recommendation which mandates that certain amount of gas must be set aside for the domestic market to the fore.
“That amount of gas set aside is targeted at 500 million cubic feet by 2013 and we are working to ensure that we get compliance in the delivery of that plan. Now if this happens, we expect a three-fold approach.
He said that getting the power situation on a better footing is the immediate priority now while efforts are being made to rapidly prioritise the gas agreements for the gas-feed industries such as fertilizer, methanol, petrochemical.
“In fact, we are trying to develop fiscal measures that can attract investors such as the oil companies so that they will prioritise the gas agreement, and if any of them comes now, and they are credible, they would be given an accelerated hearing.
“We want to make Nigeria a gas-based industry hub for the region, and of course, this is not necessarily to the exclusion of export.” He said it is in the interest of Nigeria to be open to the domestic, regional and international markets as it has enough gas to support those three markets.
On the Gas Master Plan and investors, he said the process is on-going and is on track. “The investors (15 of them) are still working their stead and preparing their proposals. They still have until October/November, which is the timeline for submission of their proposals”
The NNPC strategist said with all of these situations, even when progress and new additions are made, the country will lose out again one way or the other. So it’s just a slippery slope, but like I said earlier, we are doing a lot of work to ensure the availability of gas.
“Today, with the outage in Afam, that takes away about a 100 million cubic feet per day. The total installed capacity of gas is about 700 Million cubic feet per day, but not all of this, amount is usable because some of them are shut down.
On the transportation of sufficient gas from the east to the west, he stated that because there is the problem of connectivity across the east and west, there is always a gap, so much so that, sometimes you find excess gas in the east while it is inadequate in the west and vice versa.
“Usually we could have about 200 - 300 million cubic feet of gas per day and by the end of the year, if they are enough infrastructure or power plants we would be able to generate electricity. So, we have situations where you have got gas and there is no power plant, or where you have a power plant and there is no gas,” Ige said.
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