Making the exploration of Nigeria’s gas potential work

Nigeria’s gas reserves-to-production ratio is estimated to be about 120 years. The country with a huge natural reserves rank 9th among gas-bearing nations and is increasingly considered a gas province.

Report suggests that reserves are split nearly evenly between associated and non-associated gas. However, exploitation so far has been concentrated on associated gas, which accounts for 70 percent of total gas production. Only 35 percent of the associated gas produced is gainfully used.

Analysts are of the opinions that stratifying the gas sector into upstream, midstream, and downstream segments is needed to encourage development of projects.

They opine that most of these projects are evidently in the midstream segment, which is essentially focused on gas processing and is basically driven by process engineering.

From all indications, Nigerian government policy is making efforts to tackle incidence of gas flaring, it is the believe of industry close watchers that if properly carried out, it would address the colossal waste in such a valuable resource and the attendant devastating effect on the environment.

As laudable as these projections are, issues such as lack of gas transmission infrastructure, grossly under-utilised gas supply facilities associated with public utilities and industries, restiveness among the host communities continues to stand in the way of making progress.

Statistics show that Gas production in Nigeria is only about 3 bcfd, and there is as yet only limited effort at deliberate exploration specifically for gas. Despite its high gas resource ranking, Nigeria is not among the top 20 gas producing or utilising nations. This spells a huge potential in gas development there.

Experts point out that the continued flaring of gas is attributable to the economy’s inadequate consumption capacity for gas as manifest in the high capital cost of associated gas gathering and limited domestic demand.

They argue that the implications of this situation are huge waste of otherwise valuable natural resource and negative impact on the environment.

A cursory look at the situation of gas flaring over the years point to the fact that Nigeria successive government approach to resolving this problem has been to impose progressively stiffer penalties on producers for every unit volume of gas flared.

According to reports the result was a modest 4-5 percent growth in gas utilisation, which barely affected the problem. Consequently,

There are indications that development in the gas sector has been severely restricted by inadequate distribution infrastructure. A key development therefore has been the entry of new players bringing in investment in distribution.

Gas deliveries to both plants are at a dismal 20 percent of installed capacity due to poor plant performance. This notwithstanding, the option of converting gas to petrochemicals holds high potential and arouses keen interest.

Informed opinion in Nigeria’s gas sector believes that a gas policy that will set guidelines for rational, safe, and sustainable exploitation is long overdue. It should be expected that a gas policy will derive from this.

In the absence of such well-articulated guidelines, development will tend to be haphazard and full potentials will hardly ever be achieved.

KELECHI EWUZIE