ABUJA—As part of efforts at ensuring steady supply of gas to meet up
with growing market demand of the product, the Federal Government is
planning to construct the longest pipeline in the country from Calabar
through Ajaokuta to Kano State.
This was disclosed by the Minister
of Petroleum Resources, Mrs Diezani AlisonMadueke while delivering a
paper titled: “Encouraging Investment in Gas Production, Supply and
Consumption” at a three-day National Conference on Gas Resources
organized by the Senate Committee on Gas Resources in Abuja.
“By
the end of the year, we will be commencing, via Public Private
Partnership (PPP) scheme, the nation’s longest pipeline from Calabar via
Ajaokuta to Kano State,” AlisonMadueke stated.
Represented by the
Group Managing Director of the Nigerian National Petroleum Corporation
(NNPC), Engr. Andrew Yakubu, the Minister said that at present the
Federal Government was constructing the strategic EastWest pipeline
while the Lagos end segment of the Escravos to Lagos Pipelines System
(ELPS) is nearing completion.
She explained that almost 500km of
new gas pipelines have been completed and commissioned, including the
doubling of the capacity of the ELPS between Escravos and Oben and the
extension from Oben to Geregu and River Imo to Alaoji respectively.
The
Minister said that by the end of 2018, the backbone pipeline
infrastructure for gas would have been delivered, concluding an initial
phase of over 2500km of gas pipeline infrastructure development.
She
said that government was strategizing to leverage on the full potential
of gas to achieve massive impact on the economy and the national Gross
Domestic Product (GDP).
“We are focused on jumpstarting gas supply
to enable usage in gas to power, gas based industrialization,
compressed natural gas for transportation and commercial usage, cooking
gas for domestic usage and regional pipeline for gas export,” the
Minister stated.
She said that for government to support the
aggressive short term demand growth in the power sector, a domestic gas
supply obligation regulation which mandates a certain amount of gas
supply for the domestic market pending the full maturation of the market
was introduced.
She expressed confidence that the market will
ultimately drive itself for supply growth, adding that the long run
expectation is for less dependence on supply via obligation.
In
order to boost investor confidence in natural gas in the country, she
said government has reviewed the contractual framework for gas through
the development of world-class standardized gas supply agreements in
addition to Network Code which governs the flow of gas across the
nation’s pipeline network and provides rules for open access.
She
said that the use of natural gas instead of petrol has translated into
significant savings for over 4000 taxi drivers in Benin who are already
using this alternative energy source.
In the same vein, the
Minister said that the federal government’s efforts at eliminating gas
flaring is making significant impact as flare out rate dropped from 25%
to 11% of production.
“Many of the International Oil Companies
(IOCs) are fast approaching full flare out as the gas obligation and
infrastructure growth have all combined to enable utilization of
hitherto flared gas,” Madueke stated.
She finally called on all
stakeholders to put more effort towards full market liberalization and
address the very urgent challenge of increasing supply to the power
sector.
Speaking in similar vein, the Group Managing Director of
NNPC, Engr. Andrew Yakubu, while presenting a paper titled: “Nigeria’s
Gas Resources, Current and Future Expectations”, at the Conference put
the country’s current gas production at about 8.5 billion cubic feet per
day (bcf/d).
He explained that of the total production, 3.5bcf/d
(41%) is exported, 2.3 bcf/d (28%) is consumed domestically for power
and industries, 1.2 bcf/d (15%) is used in the upstream for gas
reinjection and balance of 0.8bcf/d (10 per cent) is flared.
In
her welcome address, the Chairman Senate Committee on Gas Resources,
Senator Nkechi Nwaogu, said that Nigeria with per capita consumption of
natural gas put at about 1.06kg, ranks lowest in Africa with only 5 per
cent of her citizens having access to domestic gas.
She explained
that the aim of the conference was to look at ways of filling the huge
gap between gas production and utilization in the country as well as
reducing routine gas flaring for the benefit of the nation and its
citizens.
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