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‘Flared gas in Nigeria enough to generate 3000Mw’

‘Flared gas in Nigeria enough to generate 3000Mw’

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Flared gas in Nigeria is enough to generate between two and three gigawatts (Gw) of electricity,  the Nigerian Gas Association (NGA) President, Dada Thomas, has said.

He spoke on natural gas under-utilisation to power the economy in Lagos.

In a document titled: “Natural gas as a catalyst for Nigeria economic transformation: Technical challenges and opportunities”, Thomas, who is also the Chief Executive Officer, Frontier Oil Limited, said the country with 192 trillion cubic feet (Tcf) reserves, has the world’s ninth conventional gas reserves. However, Nigeria only ranks about 22nd in terms of gas production and even lower consumption.

He said: “Some 48 per cent is associated gas (AG) and 52 per cent non-associated gas (NAG) with 42 per cent located offshore and 58 per cent onshore distributed over a large geographical area and largely in small pockets of less than 1Tcf. thus harnessing Nigeria’s gas resources is neither easy nor cheap.

“About 73 per cent of our gas reserves are controlled under Joint Venture (JV) contracts, largely by International Oil Companies (IOCs), 12 per cent under Production Sharing Contracts (PSCs) and 15 per cent under sole risk contracts by indigenous companies, including two per cent by marginal field operators.

“The distribution of control of gas resources is considered by many as a major impediment to accelerated development of the domestic gas (Domgas) market.”

According to Thomas, the domestic gas market has grown over the years, but still only 13 per cent or 1.01 billion cubic feet (Bcf) of total gas production of 7.5Bcf per day is consumed locally, while 43 per cent is exported via liquefied natural gas (LNG) and West African Gas Pipeline, 34 per cent is used for gas injection and 10 per cent flared.

He said: “The growth in production is encouraging, but the reality is that we found ourselves engulfed in darkness generating less than 5Gw of reliable grid power while flaring enough gas to generate 2Gw to 3Gw of electricity while some power plants are starved of gas.

“We export 43 per cent of our gas production and only have three gas based industries adding value locally and barely any meaningful gas transportation infrastructure compared to our peers.”

Thomas said the failure to harness gas resources effectively and equitably for the benefits of all Nigerians and investors, is not an option. With a population, which according to World Bank, is growing at three per cent per annum and projected to reach 233 million by 2025, and GDP growth lagging at 2.7 per cent per annum, failure is not an option.

He said: “If we fail to do the right thing to grow our economy, we are likely to experience societal upheavals the like of which may have never been seen before by mankind.

“More than 70 per cent of domgas is consumed by power plants within an illiquid and poorly regulated gas-to-power value chain that is threatening to cause systemic bankruptcy of all parts of the value chain and possibly the banking sector

“We, therefore, must conclude that we haven’t optimally exploited our gas resources for domestic use for the benefit of our nation or our people and those brave enough to invest in our country’s development.

“The forecast demand for gas is ambitious with a target of 8Bcf per day to 10Bcf/d in the long term, the bulk of about 60 per cent planned to be used for power generation. Given the relatively poor performance so far in developing the domgas sector over the years how then do we propose to achieve these ambitious targets and the transformation of the Nigerian economy using gas, given the various impediments and issues that have bedeviled and continue to plague the domestic gas industry?’’

The post ‘Flared gas in Nigeria enough to generate 3000Mw’ appeared first on The Nation Nigeria.

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