Sustaining efforts to bridge West Africa gas supply deficits

Findings across West Africa show that it has one of the most dynamic, but yet underfunded gas sectors in the world. At the moment, West African demand for gas is growing as the gas demand across Ghana, Togo, Benin and Cote d’Ivoire is estimated to be in excess of 750mmcfd.

In Nigeria, a high share of the continent’s proven gas reserves has not yielded the access to electricity the region so desired, as millions of Nigerians in the rural areas do not have access to electricity via the national grid.

Nigeria has the ninth largest gas reserves in the world, estimated at 182 trillion cubic feet, which represents the significant majority of natural gas in the region. However, NNPC report shows that approximately one third of Nigeria’s gas production are flared.

A cursory look at the West Africa region indicates that current grid-connected capacity trails demand. Nevertheless, demand and tariff imbalances between these countries have led to the improbable situation of Ghana importing gas from neighbours like Nigeria to meet up their demand occasion.

According to a report by International Renewable Energy Agency (IRENA), Natural gas-fired thermal plants sustain 50 percent of the region’s grid-connected capacity, with more than 90 percent of capacity coming from Nigeria, Ghana and Ivory Coast.

International Energy Agency (IEA) report indicates that lack of investment financing is one of the major barriers to expanding gas capacity. Domestic political pressures have, until recently, ruled out meaningful electricity tariff increases across the region, as citizens demand ever more affordable energy during the economic slowdown. The result has been dampened interest from electricity sector investors who fear they will not recoup their costs or are not impressed with the margins on offer.

Close industry sources are of the view that the issue of deficits has occurred despite regional cooperation on the West African Gas Pipeline project (WAGP), a 678 km offshore pipeline traveling East (from Nigeria) to West (Ghana) through Benin and Togo. Eighty-five percent of the purified natural gas aid generation, but Ghana’s failure to meet cash calls over the course of early 2016 led to the suspension of gas flows in July.

Analysts opine that West Africa government require the right strategy to develop gas reserves in West Africa and fashion out how to transport gas for use in power projects and industrial processes in Nigeria, as well as through the WAGP, to Benin, Togo, Ghana, and beyond westwards.

“Natural gas is a cleaner, less expensive fuel compared to liquid fuels and offers significant economic and environmental benefits for all West African countries”. They added.

They observe that WAGP currently operates at much lower volumes than its designed capacity. Even if it operated at full capacity, the receiving countries would struggle to utilise the gas because they lack modern, efficient distribution networks.

KELECHI EWUZIE