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Nigeria's National Gas Masterplan = 1. Gas Pricing Policy + 2. Domestic Gas Supply Obligation Regulation + 3. National Gas Infrastructure Policy
Nigeria To Build 3 Gas Processing Plants, Pipeline Grid -AFP ABUJA (AFP)--Nigeria plans to build three natural gas processing plants in the oil-rich Niger Delta and a grid of pipelines linking them to the rest of the country, a gas ministry official said Thursday. He quoted junior gas minister Emmanuel Odesina as having said Wednesday the new plants will be built at Warri/Forcados, Akwa Ibom/Calabar and Obiafu areas of the delta. Nigeria's junior petroleum minister, Odein Ajumogobia, has said the new gas infrastructure will cost between $15 billion and $20 billion and that it should be put in place between 2012 and 2015. The government last week adopted new guidelines compelling gas producers to set aside a yet-to-be-determined percentage of their gas production for the domestic market. Nigeria, which is currently suffering a shortage of domestic cooking gas, flares more gas than any other producer worldwide, according to Bent Svensson of the Global Gas Flaring Reduction Partnership. Nigeria's reforms are aimed at enabling the country to satisfy domestic demand for gas and to reduce flaring. None of the deadlines, the most recent of which was January 2008, set for companies to stop flaring in Nigeria has so far been respected. (END) Dow Jones Newswires
LEADERSHIP February 14, 2008
Domestic Gas Supply To Rise By 100% In 2008
Federal Executive Council (FEC) at an emergency meeting yesterday approved the much awaited National Gas Infrastructure which forms part of the new National Gas Masterplan expected to grow the economy and double the domestic gas supply by 100 per cent before the end of this year. Only recently government approved the other two components including the Gas Pricing Policy and the Domestic Gas Supply Obligation Regulation; while the National Gas Infrastructure policy which got approval yesterday together now form the Masterplan that will now guide the management of the gas sector in Nigeria. Minister of State for Energy (Gas), Mr Emmanuel Odushina, who briefed State House Correspondents at the end of the Extra-Ordinary but long FEC meeting, disclosed that part of the short term gas supply plan proposed by the masterplan is to double domestic gas availability to 1400 million-cubic feet (mmcf/d) by the end of 2008 and triple it to 2050mmcf/d by the end of 2009. He hinted that the three approvals now will form the masaterplan are expected to address the issues of reserve and production availability; inadequate gas infrastructure; and major commercial issues which prevent gas suppliers from wanting to invest in gas supply. "In order to put the domestic gas market on a sustainable growth path where buyers are assured of gas availability at affordable prices and suppliers are encouraged to invest in gas development for the domestic market, FEC also approved a gradual migration of the domestic aggregate price (currently depressed due to low gas price to power sector) to a more commercially viable price that is comparable to feed-gas prices to dominant export projects such as liquefied natural gas (LNG)"; he said.
GUARDIAN Thursday, February 14, 2008 Govt overhauls gas sector to end energy crisis NIGERIA'S energy crisis appears to be getting some more attention as far-reaching measures were announced yesterday by the Federal Government. The deplorable energy situation and government's concern apparently prompted the extra-ordinary Federal Executive Council (FEC) yesterday from which decisions on the new measures were taken. On the arrowhead of the drive was the government's overhaul of the gas sector with a view to making the product available for power generation. After about seven hours of brainstorming at the special session, FEC yesterday announced the first Nigerian Gas Infrastructure Blueprint, which contains the new projects to be set up to boost gas production and grow the economy. President Umaru Musa Yar'Adua, who presided over the meeting, had last week approved a new gas pricing and domestic supply obligation regulations. The new master-plan aims to use three key strategies in achieving this objective: the stimulation of the multiplier effects of gas on the domestic economy, positioning Nigeria competitively in high value export markets and the guarantee of long-term energy security for the nation. The Council also approved short-term, medium-term and long-term gas supply targets. In the short-term, the blueprint aims to double domestic gas supply to 140mmcf/d by the end of 2008 and triple it to 2050mmcf/d by the end of 2009. The plan also envisages that power generating capacity will grow to about 4.5GW (excluding hydro) by the end of this year and 6.2GW (excluding hydro) by the end of 2009. The plan also aims to triple the gas availability to existing domestic industrial users by the end of next year to about 450mmcf/d. Minister of State for Energy (Gas), Mr. Emmanuel Odusina, along with the Minister of Information and Communications, Mr. John Odey, told journalists at the end of the FEC meeting that henceforth, all investments in gas infrastructure would be "holistically" guided by the blueprint to ensure that synergies are maximised and infrastructure aligned to deliver the Nigeria's power and economic needs. Details of the infrastructure blueprint comprises the creation of three domestic central processing facilities at the Warri/ Forcados area in Delta State, the Akwa Ibom /Calabar section and the Obiafu zone located in the North of Port Harcourt, Rivers State. This part of the blueprint, which is under the medium-term plan, also stipulates the development of three major domestic gas transmission systems in Nigeria. They include the Western system comprising the existing Escravos Lagos Pipeline System (ELPS) and a new offshore extension to Lagos; the first South-North gas transmission line that will take dry gas through the Akwa Ibom/Calabar facility to Ajaokuta, Abuja, Kano and Katsina. This line will also serve the South-East states of Anambra, Abia, Ebonyi, Enugu and Imo. The third system would be an interconnector, which will link the eastern gas reserves centre with the other two transmission systems. Odusina noted that the central processing facilities would be the major gas hub where wet gas from gas fields will be treated and processed. The (LPG) and condensate will then be extracted at these facilities and the dry gas fed into a network of gas transmission lines. He said that with the arrangement, more LPG would be available for domestic use and the recurrent problems of liquid ingress into pipelines, which had continually impacted on power supply would be permanently eliminated. Odusina added that the transmission infrastructure would enable the industrialisation of the eastern and northern parts and ensure connectivity between the East, West and the North, which does not exist now. According to him: "The system is to be developed as a grid, ensuring redundancy and multiplier access to gas markets from any gas source. This increases the resilience of the gas market to pipeline disruptions. The infrastructure as proposed would ensure that synergies are optimised and is expected to result in overall cost reduction of about $4 to $5 billion. Also, the blueprint delineates three franchise areas around the central processing facilities. In essence, only licensed investors would be allowed to develop and operate the facility. This would prevent the proliferation of gas facilities with attendant gas impacts." He also stated that "in order to put the domestic gas market on a sustainable growth path where buyers are assured of gas availability at affordable prices and suppliers are encouraged to invest in gas development for the domestic market, the Council also approved a gradual migration of the domestic aggregate price (currently depressed due to low gas price to power sector) to a more commercially-viable price that is comparable to feed-gas prices to dominant export projects such as the LNG." Odusina said that the Council had not taken a final decision on the issue of gas flaring as "we don't want to make the mistake of past government in issuing deadlines" and lamented that "the gas sector is faced with significant challenges which are manifested in the numerous power plants lying idle for lack of gas. For many years, gas was flared in the country because there was no domestic market to utilise it. The situation has however changed very rapidly." From a low-level gas utilisation of about 700mmscf/d in the domestic market, Nigeria now has a huge gas potential estimated at 6000-10,000mmcf/d. He allayed fears that the unrest in the Niger Delta may militate against the implementation of the master-plan, saying that "the President and the Vice President are working hard to get agreement towards creating the right environment for the implementation of the plan. And right now, we have over seven formidable international companies who want to invest in furtherance of this plan." Nigeria has the seventh largest gas reserves in the world with a potential of about 185 trillion standard cubic feet of gas.
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