‘Policy inconsistency still holding back investment in energy sector’

Concerned operators and industry experts in the oil and gas sector have stated that issue of policy somersault and inconsistency present major challenges in the economy adding that unless this is tackled, investment would be difficult to come by.

They also called on the Federal Government to urgently address the lapses in gas infrastructure, funding and resolve hiccups that gas shortage poses as this will encourage investment to grow the economy.

Bolaji Ogundare, Ceo of NewCross Petroleum says some of the areas where gas has the potential of earning revenue include: Wide spread adoption and utilisation of LPG as preferred fuel for domestic cooking.

According to him, “Adoption and utilisation of CNG as fuel for vehicles and generating plants for industries in recognition of the potentials of the Gas sub-sector a number of initiatives have been adopted to stimulate development of the Gas sector”.

Ogundare observes that despite the huge gas reserved in Nigeria, shortage of gas remain a challenge as bringing gas out is the challenge because the International Oil Companies are not willing to invest so much on gas.

Ayodele Oni, an energy expert pointed out that increasing vandalism of oil and gas facilities in the Niger Delta have considerable reduce NGC ability to deliver required gas in the downstream.

He further outline funding as a major towards building the require infrastructure to grow the gas to power value chain to grow the economy.

Oni suggested that a way out of this situation is the need to intensify Nigeria diversification drive away from oil.

He opine that lack of gas is threatening the gas to power project adding that the Power sector challenges without doubt cascade into other sectors like the manufacturing which affects the economy.

Analysts opine that of the estimated 8 billion scf per day volume of gas produce in Nigeria, 40 percent are tailored towards export, while 13 percent of gas produced is flared. Nigeria is one of the leading countries with the highest gas flaring activity.

They are optimistic that Nigeria electricity generation output will receive increase once the Federal Government and its other joint venture partners intensive its investment commitment to gas gathering projects which will further achieve zero gas flaring in the country.

According to them, “When the estimated figure of 211.836 billion SCF of gas been flared are converted into power, Nigeria could be generating a sizeable amount of electricity for domestic use.

Industry watchers maintain that a step into achieving this aspiration should start with the introduction of the domestic gas obligation which imposes an obligation on the oil companies to assign certain percentage of the gas being produced for domestic uses.

“Looking at what is going on in the industry, the future is selling our gas domestically because the international prices are in decline”, they said.

KELECHI EWUZIE