Exploration options raises hope to plug gas supply deficit across West Africa

Nigeria, Ghana, Cote d’Ivoire are some of the countries across the West Africa region with boundless potentials when it comes to the exploring natural resources especially natural gas.

Reports indicate that in a country like Cote d’Ivoire, there is potential for significant gas finds. However, much of the territory is unexplored and recent finds have not yet been appraised for commerciality.

It is also believed that increasing domestic production over the short-to-medium term would require high capital investment from explorers, which looks unlikely, given the current economic volatility in the upstream industry.

Côte d’Ivoire is estimated to have about 28.3 billion cubic meters of natural gas according to a research carried out by African Energy, adding that this leaves a substantial portion of natural gas yet to be exploited, new investments in exploration and drilling are necessary to uncover the commercial viability of deposits and prevent the decline of production.

“Uncertainties surrounding the future volumes of domestic gas supplies have opened up opportunities for LNG import schemes to plug Cote d’Ivoire’s gas deficit. Under a high gas demand scenario, which includes new gas-fired power generation and gas-hungry mines, the deficit could exceed 1,000mcf/d by 2020, equating to LNG demand of over 6.8m t/yr,” the research indicated.

Already there are skepticism that unless new gas supplies can be sourced, either from significant domestic finds or LNG imports, a limited number of gas-to-power projects are expected in the coming years: the 330MW Grand Bassam OCGT which is to be run off gas supplied from the Gazelle field (although final investment decisions on the plant, gas field, and gas processing terminal are still awaiting, and expected in Q1 15) and Petroci and ContourGlobal’s Abatta CCGT plant appears stalled until gas supplied can be secured.

Statistics indicate that Nigeria remains very strong in terms of gas production as production has not drop by any significant margin since the global crude oil price drop started.

Recent figures show that Nigeria currently produces 7 billion scf per day. 43 percent of production is either re-injected or flared without any commercial benefit, another 43 percent is exported via NLNG, WAGP.

Nigeria is endowed with abundant gas resources and the sector holds huge potentials for unprecedented growth, industry close watchers have opined.

They however observe that the existing legal and regulatory framework should provide robust technical and commercial framework for gas to achieve the desired commercial potential.

“The solution to this is simple and not in any way complicated, a local gas market without government interference in pricing will definitely be attractive to investors” analyst said.

Analysts further maintain that as an enabler, the gas sector framework will entrench transparency, efficiency, fairness and non-discriminatory access to gas transportation networks.

Government had reasoned that successful transportation of gas for power generation and other domestic use required rules setting forth the quantity and quality of gas, which international oil companies would input into the pipeline as well the quantity and quality of gas to be utilised by users, including power plants.

It is the views of industry experts that discovery of new gas which would be backed up by investment would result in the plugging of a supply gap noticed in both Nigeria and her neigbouring West Africa countries.

KELECHI EWUZIE