Nigeria sees biggest decline in gas production in 2013
Amid the growing demand for natural gas in the country, especially for power generation, Nigeria recorded the largest volumetric decline in natural gas production last year among over 48 gas-producing countries captured in the BP Statistical Review of World Energy 2014 released last week.
Nigeria, Africa’s top oil producer and largest holder of natural gas reserves in the continent, saw natural gas production in the country fall by a massive 16.6 percent to 36.1 billion cubic meters (bcm) from 43.3 bcm in 2012. India recorded the second largest decline of 16.3 percent.
The report shows that gas production in Algeria, the largest natural gas producer in Africa, dropped to 78.6 bcm in 2013 from 81.5 bcm in the previous year, while production in Egypt fell to 56.1 bcm from 60.9 bcm in the previous year. Libya, which holds the largest proven crude oil reserves and the fourth largest proven natural gas reserves in the continent, saw the smallest decline from 12.2 bcm to 12 bcm.
Nigeria’s oil production also fell to 2.322 million barrels per day in 2013 from 2.417 million bpd in the previous year, according to the BP Statistical Review, while Angola, Africa’s second biggest oil producer, saw its production increase to 1.801 million bpd from 1.784 million bpd in the previous year.
“Of course gas production in Nigeria will decline. What exploration are we doing in the country? What the international oil companies (IOCs) are simply doing is managing their assets and taking their money. The Petroleum Industry Bill (PIB) is one of the elements that are important in boosting gas production as it would provide certainty in the industry,” said Dayo Ayoade, senior lecturer, energy law at the faculty of Law, University of Lagos.
Noting the increased demand for gas supply for power generation in the country, he said: “We really need to address this issue of gas. Everything is in utter stagnation. Gas production will continue to decrease if the PIB is not passed. Anybody who wants to invest wants to know the fiscal regimes under which they will operate. We have held up key gas projects. We are still in the stalemate that we have been for years.”
The United States remained the world’s leading producer, with a 1.3 percent increase to 687.6 bcm in 2013, but both Russia and China recorded larger growth increments in 2013 of 2.4 percent and 9.5 percent respectively.
Nigeria, which is home to the world’s ninth biggest gas reserves, with about 187 trillion cubic feet (Tcf) of proven gas reserves and 600 Tcf of unproven gas reserves.
But industry analysts say the non-passage of the PIB, which is in the National Assembly, is taking a toll on the realisation of the objectives of the Nigerian Gas Master Plan as investments in gas production remain largely stalled.
Globally, natural gas accounted for 23.7 percent of primary energy consumption and its production grew by 1.1 percent, which was well below the 10-year average of 2.6 percent.
FEMI ASU