Domestic market to get boost by Seplat’s projected 525m scf/d gas capacity

Nigeria’s domestic gas market will be strengthened as Seplat Petroleum Development Company plc has announced plans to increase its gas processing capacity to 525 million standard cubic feet/day (mscf/d) by the end of the fourth quarter of 2016, according to Austin Avuru, managing director/chief executive of the company.

Remarking on the state of the domestic gas market, Avuru said due to divestments in the Nigerian oil and gas market by international oil companies, indigenous oil and gas companies would play a larger role by 2018.

He stated that the company’s gas processing capacity increased by 100 percent to 300mscf/d after the completion of Phase 1 expansion of their Oben gas plant in 2015.

The company noted that additional 150mscfd gas processing capacity came at the cost of $150 million, and now contributing about 40 percent to the nation’s power grid.

“The power supply that we still have in Nigeria now is possible because Seplat Petroleum Development Company plc had made this investments in the gas sector,” he said.

According to Avuru, Seplat is set to build an integrated gas company over the next five years that provides gas solutions to the domestic market while extracting value and creating a sustainable and balance portfolio for the company.

In recent times, the Seplat boss has been advocating for Nigeria to make strategic investments to increase participation in local refining of crude oil by building modular refineries and increasing gas production capacity, therefore advocating for what he calls “domestic energy security.”

Explaining the impact that a domestic energy security inspired policies will mean for Nigeria, he said: “Domestic energy security will mean that we will get the electricity we need with all the multiplier effects. It means that things like cement used for construction, Nigeria will be a net exporter.

“It means that we will have enough fertilizer and become net exporter of fertilizer with the attendant effect on agriculture. It will mean that we will become a net exporter of petrochemical products.”

However, BusinessDay had reported on experts who had carried out studies on the nation’s refineries and now warned the government against investing in modular refineries, remarking that it would amount to economic waste. This is because the petroleum market in Nigeria favours consumption of light and middle distillates, which are not produced by modular refineries.

Solomon and Associates, an energy bench-marking firm, stated that the use of fuel oil to fire furnaces in local industries was declining rapidly, and was being replaced by natural gas, which is cleaner and abundantly available in Nigeria.