Prioritising gas sector development for national development
The Nigeria gas sector has not significantly affected the energy industry as a whole. The crises in the gas sector and gross inadequate infrastructural has continued to be the bane in the gas sector. Nigerian government has also not accorded gas sector development any importance. For instance, there is developmental plan on the energy generally, both in industrial and domestic space.
This is even more painfully and regrettable going with the fact that Nigeria has the highest reserve of gas, about 187 tcf, in Africa but the least in gas per capital usage.
The plans by the federal government to deepen the prospect of gas to attract the desired investment to grow the economy and strengthen the energy sector may never see the light of the day unless there is a radical rethink of gas policy industry experts have said.
From all indications, the gas sector in Nigeria holds out significant economic potential to Nigeria as the federal government through the ministry of petroleum resources says it plans to enhance gas and other derivatives to ensure they attract forex rather than continue with a situation where oil is the main source of forex accruals for Nigeria.
Industry watchers are however concerned that the inadequacy of the existing gas processing, transmission and distribution infrastructure to support the current demand, may slow that process of growth suggesting that the managers of the economy must as a matter of urgency streamline the adoption of a national Gas Infrastructure Blueprint that seeks to address the need for rapid deployment of gas infrastructure across the country.
Dada Thomas, managing director, Frontier Oil Limited observes that the pricing structure and the nature of contracts remain a significant obstacle to the development of natural gas in Nigeria, saying that there is a need for a standardisation and harmonisation of the agreements.
He argues that the absence of incentives to encourage investment in key infrastructure to boost local production and sales of the product to consumers, must occupied a pride of place in government priority list.
Industry close watchers maintain that a shift in the geopolitics of the gas sector and the socio-political economy of Nigeria calls for a radical rethink on gas policy if the country hopes to address her challenges energy issue.
“Nigeria has to be very smart and must act very quickly too. Another important and relevant dynamic is the apparent aversion of the IOCs for the midstream in Nigeria or even the downstream for that matter, a game that is natural to them and which they play so well in other countries”. They added.
Analysts observe further that the development of gas infrastructure will help accelerate Nigeria’s elusive and much desired industrial development and economic growth.
Government cannot afford to fund the development of gas infrastructure at the pace that Nigeria’s socio-economic developmental requirements, adding that the gas sector is most amenable to private sector capital if the right conditions are put in place.
Nigeria with her huge natural gas reserve stands to benefits from increased capacity production, industry watchers insists saying that natural gas has the potential to engender rapid positive growth and enormous impact in the overall economy of our nation.
They maintain that while it is not difficult to decipher that ultilisation of gas has assumed a new dimension for both economic and technological development stressing that achieving the desire result in local gas supply or the lack of it will remain a very sensitive issue with government involvement in unrealistic prices.
KELECHI EWUZIE