Gas supply: FG to build longest pipeline

The Federal Government on Tuesday said it is planning to construct the longest pipeline in the country from Calabar via Ajaokuta to Kano State. This is as it said that gas flaring has dropped to 11 percent.

Gas flaring level stood at about 25 percent two years ago.

This is part of efforts at ensuring steady supply of gas to meet the growing market demand for the product.

Diezani Alison-Madueke, minister of petroleum resources, disclosed these while delivering a paper titled, ‘Encouraging Investment in Gas Production, Supply and Consumption’, at a 3-day national conference on gas resources organised by the Senate Committee on Gas Resources in Abuja.

“By the end of the year, we will be commencing, via public private partnership (PPP) scheme, the nation’s longest pipeline from Calabar via Ajaokuta to Kano State,” Alison-Madueke said.

Represented by Andrew Yakubu, the group managing director of the Nigerian National Petroleum Corporation (NNPC), the minister said that at present the Federal Government was constructing the strategic East-West pipeline, while the Lagos end of the Escravos to Lagos Pipelines System (ELPS) is nearing completion.

She explained that almost 500km of new gas pipelines have been completed and commissioned, including the doubling of the capacity of the EPLS between Escravos and Oben and the extension from Oben to Geregu and River Imo to Alaoji, respectively.

The minister said that by the end of 2018, the backbone pipeline infrastructure for gas would have been delivered, concluding an initial phase of over 2,500km of gas pipeline infrastructure development.

She further observed that government was strategising to leverage on the full potential of gas to achieve massive impact on the economy and the national Gross Domestic Product (GDP).

“We are focused on jumpstarting gas supply to enable usage in gas to power, gas based industrialisation, compressed natural gas for transportation and commercial usage, cooking gas for domestic usage and regional pipeline for gas export,” she said.

She further observed that for government to support the aggressive short-term demand growth in the power sector, a domestic gas supply obligation regulation which mandates a certain amount of gas supply for the domestic market, pending the full maturation of the market was introduced.

She expressed confidence that the market would ultimately drive itself for supply growth, adding that the long run expectation was for less dependence on supply via obligation.

In order to boost investor confidence in natural gas in the country, she said government has reviewed the contractual framework for gas through the development of world-class standardised gas supply agreements in addition to Network Code which governs the flow of gas across the nation’s pipeline network and provides rules for open access.

She said that the use of natural gas instead of petrol, has translated into significant savings for over 4,000 taxi drivers in Benin, who are already using this alternative energy source.

In the same vein, the minister said that the federal government’s efforts at eliminating gas flaring was making significant impact as flare out rate dropped from 25% to 11% of production.