Renewed innovative thinking rises hope for Nigeria’s gas industry

The prolonged environmental uncertainties occasioned by government interference, policy inconsistency among others have over the years conspired to stifled new investment prospect into the Nigeria gas industry space.

With issues around decoupling of gas resource from oil which tends to slow the pace of gas-based industry development, prevalent in the past, it comes as a huge relief that the present innovative strategies and approach by the federal government portend a glimmer of hope to Africa’s largest economy.

Ibe Kachikwu, minister of state for petroleum resources while delivering a keynote address at the 2017 Nigeria Oil & Gas Conference and exhibition said Nigeria has witnessed an increase in the National Gas Reserves from 188 Trillion cubic feet (Tcf) in 2015 to 192 Trillion cubic feet in 2016.

Kachikwu observed that government policy interventions aspires to among other things; move the economy to be predominantly gas operated; Diversify the gas supply options within Nigeria, to ensure security of supply; Extend gas penetration in the domestic market in order to facilitate the growth of the electric power, agricultural and industrial sectors.

According to him, Federal government intervention would gain a presence for Nigerian gas in international markets; operate a gas industry with a clear division of roles between private and public sectors; end and commercialise gas flaring and address environmental issues.

Industry watchers observed that with the right measures Nigeria stands to gain from a diversified gas supply options within Nigeria, to ensure security of supply adding that this would further extend gas penetration in the domestic market in order to facilitate the growth of the electric power, agricultural, and industrial sectors.

Government renewed vigour to address outstanding issue that inhibited the growth of the gas industry such as funding, security, regulation is a welcome development said Mike Onyekonwu, an energy resource person with Laser Engineering and Resources Consultants Limited.

Onyekonwu noted that a transparently and professionally run gas industry with minimal government interference no doubt will see investment activities.

According to him, “Government and investors derive optimal benefit from a transparently run industry. It is ideal that Nigerian should be empowered to participate in the industry and government create investment friendly environment to attract investors”.

Chijioke Mama, CEO/Founder of EnergyDatar, a Lagos-based advisory firm is of the view that all efforts should be summoned to see the passage of the PIB next month in a form that is suitable to most stakeholders and investors.

Mama was quick to note that encouraging the fast development of local refining capacity including Greenfield refineries, salvaging existing refineries and aggressive development framework for modular refineries must begin now.

According to him, there is the need to initiate the proper decoupling of gas resource from oil which tends to slow the pace of gas-based industry development. Local gas consumption is clearly not at pace with supply as the bulk of Nigeria’s gas finds its way to markets in Europe.

Analysts are of the view that the new draft gas national policy by the ministry of petroleum resources has drawn up gas fiscal terms to fix these issues.

Kachikwu observed that through the 7 BigWins roadmap of which gas sector features prominently, the federal government is focused and committed to take unprecedented steps and make dramatic policy shifts to deepen and open up the business and opportunities in Nigeria’s Gas Sector.

By KELECHI EWUZIE