- As Seplat sustains gas business, accounts for 30% of Nigeria’s gas-to-power generation
- Sanwo-Olu plans green jobs for Lagos
Gas value-chain experts have adduced that Nigeria, Africa biggest gas producer, but which faces being overtaken by Mozambique, needs to build institutional capacity to drive and sustain its gas transition, which is critical to attaining value and wealth advancement.
They also said there is need to drive investments into the gas industry through liquidity pools such as: the capital markets, bonds and PFAs, as well as exploring a myriad of financing options to provide funding for the nation’s gas infrastructure projects.
This emerged during this year’s Nigerian Gas Association (NGA) industry multilogues 2, its 12th biennial international conference themed: “Powering Forward: Enabling Nigeria’s Industrialisation Via Gas,” held virtually, where the experts particularly said, Nigeria, though being Africa’s top gas producer, faces grim challenges bedevilling its gas-to-power drive such as: capital intensity; under-investment; delayed delivery of planned gas infrastructure; poor pipeline network; lack of cost reflective tariffs and huge debts in the power sector; lack of clear gas fiscal terms for PSCs, and delay in passage of the Petroleum Industry Bill (PIB), amongst others.
Audrey Joe-Ezigbo, president of NGA, however, commended Seplat Petroleum Development Company Plc, a leading indigenous energy company, and other players for their dedication to the growth of the gas sector in Nigeria.
Joe-Ezigbo said there was the need to continuously project and leverage the potentials of gas towards enabling and reinvigorating Nigeria’s industrial sector.
“Riding on the declaration by the minister of state, petroleum resources, Timipre Sylva, to dedicate the new decade to the promotion and adoption of natural gas as the fuel of choice for national growth, it has become imperative for us to reinforce this paradigm, leveraging its benefits across diverse key sectors in Nigeria and across Africa,” Joe-Ezigbo said.
Meanwhile, Roger Brown, chief executive officer, Seplat Petroleum Development Company Plc has identified Seplat’s fast-growing gas business as a strong catalyst for sustainable development in Nigeria. He described the drive as a revolution, indicating that the direction is laudable and highly rewarding to the Nigerian economy and its people at large.
Speaking at the Nigerian Gas Association (NGA) industry multilogues 2, Brown saidSeplat’s contributions to the Nigerian gas industry was increasing. “Our new Sapele Gas Plant processing capacity (PC) is 75 MMscfd, increasing PC in the West to 54 0MMscfd (Oben and Sapele),” Brown said.
According to him,Seplat currently contributes about 30 per cent of gas-to-power generation in Nigeria. Its ANOH project is to add 300 MMscfd capacity, and unlock over 1,200 MW of gas constrained power generation capacity.
Brown, during his panel session on: “Nigeria’s Decade of Gas: The Industry Leadership Outlook,” said Seplat is strategically positioned to access Nigeria’s main demand centres with its current well stock delivering 300–350MMscfd gross.
The leading energy company was honoured for its industry strides with the NGA special recognition award for its strong and outstanding support in service to the Nigerian gas industry and the Nigerian Gas Association.
The Seplat CEO said Seplat has numerous opportunities to scale up and diversify, some at relatively low cost. The company has significant opportunity to lead Nigeria’s strategic dash to gas, replacing inefficient diesel and petrol generation, benefiting economy with multiplier effects on gas demand. He said gas offers higher profitability and cash drop-through than oil owing to lower royalties, taxes and costs; of which gas revenues are independent of oil price volatility, with 10+ year contracts offering long-term visibility.
“ANOH could increase gas production by 300MMscfd, with potential for further expansion. There is the potential to increase production at existing Oben and Sapele plants; and to service industrial gas needs at prices higher than fixed-price domestic supply obligation. The potential to end flaring and monetise gas by-products and develop LPG products for local market to replace biomass as cooking fuel abounds,” he said.
Meanwhile, the group managing director of the Nigerian National Petroleum Corporation (NNPC), MeleKyari, represented by the corporation’ chief operating officer (COO), gas and power, Yusuf Usman, said NNPC was committed to fulfilling President Muhammadu Buhari’s directive to boost domestic gas supply.
Kyari said progress was being made on several of the projects, including the NLNG Train 7, with a foreign direct investment of between $3 billion and $5 billion; and the ANOH gas project, with a fully completed financing arrangement. He listed others as: the AKK, which he described as one the largest and most aggressive gas infrastructure ever embarked upon in Nigeria, stretching 614 km from Ajaokuta, Abuja, Kaduna and Kano, and Lot B of the OB3 gas project, which is already producing 125 MMscfd of gas.
For the Lagos State Governor, BabajideSanwo-Olu, there was need to have a cleaner, more liveable environment, noting that he is planning well for the state’s huge population, guaranteeing green jobs, reducing carbon emissions and working towards a healthy environment.
He maintained that there was the need to boost domestic utilisation of gas, and that Lagos set upIbile Oil and Gas, privately-driven, to transition the state to a low carbon economy by taking out firewood, kerosene and all the dirty fuels.