GAS SUPPLY: Domestic demand for gas in Nigeria unprecedented

Abiodun Obadayo |

Domestic demand for gas in Nigeria has been described as being unprecedented, with a current daily realistic gas demand of 4,000mmscfd.

The Group Managing Director (GMD) of NNPC, Dr Maikanti Baru stated this in his keynote address titled: “Driving Nigeria’s oil and gas Industry towards Sustained Economic Development and Growth,” at the ongoing 17th Nigerian Oil and Gas conference in Abuja on Tuesday.

Dr Maikanti Baru said in terms of gas production, the figure was expected to grow to about to about 7,500mmscfd in the next five years.

“However, within the next three years, with our Joint Venture partners, we are committed to increasing natural gas availability from the current 1.5bscf/d to about five billion standard cubic feet per day in 2020,” said Baru.

According to him, the government would supply enough gas to generate up to 15GW of electricity to the power sector by 2020 and stimulate gas-based industrialisation.

“We would continue to progress with our seven Critical Gas Development Projects (7CGDP) which has also been established to deliver about 3.5bscfd of gas to the domestic market by 2020.

“Recently we approved 2.8 billion dollars, 614Km Ajaokuta-Kaduna-Kano (AKK) pipeline project as a demonstration of our commitment which anchors on developing structured gas architecture across the length and breadth of Nigeria.

“This trajectory will continue to be our priority in the medium to long term,” he said.

The NNPC boss said the continued implementation of the gas master plan remained a core focus of the corporation.

Baru explained that gas pricing had been adjusted to export parity, and legacy debts owed by the various sectors to suppliers were being paid through an intervention fund arranged by the Central Bank of Nigeria.

He said gas supply agreements would continue to be made effective with terms that assured bankability to provide the relevant comfort to the producers.

“The World Bank Partial Risk Guarantee (PRG) would be sustained to provide securitisation of gas revenues. These interventions are boosting confidence in the gas sector.

“On the gas export market, part of our strategic aspiration for gas is to strengthen our footprint in high value gas export through LNG and aim to secure about 10 per cent of global market share of traded LNG.

“On the expansion of our existing 22MTPA NLNG plant, we are at the verge of taking Final Investment Decision (FID) this year for additional 8MTPA NLNG Train 7 Plant,” said Baru.

On the country’s crude oil, Dr Maikanti Baru assured that, NNPC would increase the reserves by one billion barrels yearly to attain 40 billion barrel by 2020 adding that the corporation was also working towards increasing daily oil production to three million barrels per day (bpd).

The NNPC boss said the corporation would also ensure that the Nigerian Petroleum Development Company (NPDC) grew its production to 500,000bpd of oil and 1.5Bscfd of gas by 2020.

He commended the innovative and bold strides of the organisers of the conference in providing a platform for the interaction and cross fertilisation of oil and gas industry ideas in Nigeria.

He said the event had become a household name and hoped that the gains would be sustained.

“The journey has been quite challenging and exciting as well. We have journeyed through hills and valleys, through bumps and stumps; nonetheless, our resilience has ensured that NNPC continues to stand shoulder high.

According to him, the corporation’s outlook for 2018 and beyond is to be in the capital market to raise more finance for new oil and gas projects.

He said funds raised would be used to finance projects such as the NNPC/NAOC JV Idu-redevelopment, South Gas Project, North Gas Project and Central Gas Project.

The others are: NNPC/TEPNG JV’s Ikike Project, NNPC/SPDC JV Southern Swamp and Associated Gas Solution Step 2 Project amongst other new projects.

“We intend to sanction the multibillion dollars Bonga South West/Aparo (BSWA) project as soon as we conclude an agreement on the Heads of Terms with SNEPCO on the various pending PSC Arbitration disputes.

“This will jump-start the resolution of all the other Production Sharing Contract (PSC Arbitration Disputes),” he said.

The Vice- President, Production of CWC Group Wemimo Oyelane lauded the contribution of late Dr Alirio Parra, the founder of Nigerian Oil and Gas Conference towards bringing stakeholders together to discuss issues to move the industry forward.

The Vice- President urged stakeholders not to waiver in their contributions to the development of Nigerian oil and gas sector.