Gas

Lagos, March 20, 2024: The Nigerian Gas Association (NGA) has commended the Federal Government for gazetting three policy directives on fiscal incentives for non-associated gas, midstream and deep water developments.

Mr Aka Nwokedi, President, NGA, said in a statement on Tuesday in Lagos that the policies would herald a monumental leap towards unlocking investment in the oil and gas sector.

Nwokedi said that the directives, which encompass multifaceted strategies, included the streamlining of the contracting process to a compressed six-month cycle and applying local content requirements without hindering investment or cost competitiveness.

The NGA president described the directives as transformative milestones, to revolutionise Nigeria’s oil and gas sector energy landscape, with gas as a critical enabler.

He emphasised that the strategic introduction of fiscal incentives for non-associated gas, midstream, and deep water developments would attract substantial investment, bolster security measures.

He said it would also escalate production rates activities, amplify domestic gas utilisation, and refine the ease of doing business within the sector.

“Furthermore, streamlining the contracting process to expedite the current 36 months contracting cycle to just six months is hailed as a game-changer.

“This would significantly reduce bureaucratic bottlenecks and enhance operational efficiency across the sector.

“This streamlined approach will catalyse project execution, optimise resource allocation, and foster a conducive environment for local and international investors.

Abuja, March 16, 2024: The Nigeria Extractive Industries Transparency Initiative (NEITI) is appealing to the Federal Government for an improved gas policy for the country following the global upsurge in energy transition.

Its Executive Secretary, Dr Ogbonnaya Orji, made the appeal at the closing of a two-day capacity-building workshop and stakeholders engagement on methane emissions reduction in Nigeria.

The event was organised by the Center of Journalism Innovation and Development (CJID) and the Natural Resources Governance Institute (NGRI).

Orji said that gas would play a very crucial role in the global energy transition, of which Nigeria has the largest gas reserves in Africa and ranks ninth in the world.

He said that Nigeria’s gas policy must be reviewed to get the desired result from  the process.

”For this to happen, NEITI hereby renews its appeal to our government to embrace efficient gas commercialisation and utilisation policy.

”For instance, NEITI’s recent report of the oil and gas industry disclosed a total unremitted revenues of gas royalty payments of $559.8 million.

”This is in addition to the outstanding unremitted sum of $828.8 million from unpaid gas flare penalty also disclosed by the same report.

”A close look at these figures indicated that more gas was flayed during the period than utilised, thereby denying the federation potential revenues and posing serious dangers to the global zero emissions agenda,” he said.

According to him, the energy transition and emission control will necessitate new technologies, require human capital, redefine roles and responsibilities, and involve costs in both human and material resources.

Orji said that the workshop and meeting of the stakeholders was appropriate, considering that developing nations required enough information and data on what the future holds for them to make an informed decision.

He added that the workshop also provided a platform for public debates and discussions necessary to chart a national agenda in energy transition

”This is why NEITI is currently reviewing Nigeria’s energy transition plan to establish the role of information and data in making informed energy transition decisions.

”Given the growing reality of energy transition and the strong linkage with emissions control, especially methane, it is important that we are constantly exposed to this type of quality training,” he said.

He  stated that addressing the prediction of an upsurge in Nigeria’s energy demand, which may surpass the projected global average by 47 per cent by 2050, required the collaborative efforts of key stakeholders.

Orji  underscored the importance of global partnership to mitigate the risk of energy transition through innovative and courageous reforms toward economic diversification.

The NEITI Boss acknowledged that there were opportunities of investment in energy transition in the areas of technology, solid minerals, human capital development, use of low carbon hydrogen and gas exploration which should also be optimally explored.

Chief Executive Officer of CJID, Mr Dapo Olorunyomi, stated that the meeting was  aimed at fostering better collaboration between stakeholders in reducing methane emissions in Nigeria.

On her part, the African Director NGRI, Nafi Chinery, urged stakeholders, particularly relevant government agencies, to work in synergy to reduce methane emissions.

She also urged the media and Civil Society Organisations to advocate for the move in their engagements, stating that proper coordination was critical in achieving various local and international commitments on methane reductions.

The highlights of the event were  the launching of a guidebook on Nigeria’s Energy Transition and the presentation of NRGI’s findings on Nigeria’s Methane Emissions Reduction Strategies.

Abuja, March 11, 2024: Some Gas Dealers and FCT residents have decried the surge in the price of Liquefied Petroleum Gas (LPG), known as cooking gas.

According to them, the Federal Government should as a matter of urgency wade into the issu

The dealers and residents said on Sunday in Abuja expressed dissatisfaction over the constant rise in the price of the product and its attendant effects.

Cooking gas is currently sold between N1, 300 and N1, 600 per Kg as against N900 in November 2023 and N1, 000 sold in January 2024.

Mr Promise Ajujumbu, the Chief Executive Officer of Promise of God Gas Company, who decried the steady rise in LPG price attributed it to high foreign exchange and cost of transportation of the product.

Ajujumbu appealed to the government to intervene by boosting the local production of gas as well as stabilise the naira because the forex was affecting the cost of LPG greatly.

According to him, 20 tonnes of LPG being sold at N9 million, rose to N19 million currently.

NAN reports that the Automotive Gas Oil (AGO), known as diesel is used by petroleum transporters and distributors to fuel their trucks which distributes petroleum products to different parts of the country.

Chief Chukwuma Kalu, an official of the Shore Gas Limited said high cost of diesel for transportation of petroleum products, including gas to various routes in the country was a major cause of the surge.

Kalu told NAN that diesel was being sold at about N1, 300 per litre and to fuel a truck to transport gas from Lagos to Abuja requires about 1,000 litres of diesel.

“To transport gas from Lagos to Abuja is very high and requires more than N1.5 million. There is nowhere that gas is cheaper in Nigeria, it boils down to cost of transportation.

“The cost at which the end users are buying gas currently is just the surviving cost of the gas plant because dealers are selling at a loss and only sell to maintain their customers.

“In the station, we also use diesel to power our plant for more than 12 hours to dispense gas to customers apart from the electricity token, we buy in addition to multiple taxes/levies we pay in the FCT  ’’ he said.

According to him, the upper takers/major distributors, who import or take directly from the Nigeria Liquefied Natural Gas buy the product in dollars which is affecting the cost too.

He called for a sustainable government policy that could be impactful on the masses economically and socially.

Mrs Grace David, a petty business owner also expressed sadness on the price surge, adding that it had made her to resort to the use of firewood and charcoal (Biomass), though not so cheap but served as a relief.

“With the high standard of living currently, it is very worrisome, the government should quickly intervene and bring succour to the citizens,’’ she said.

Another user, Mr Lawrence Nze said the rate of the increase in LPG price required fast intervention to mitigate the negative effect on the poor masses who were struggling to survive since fuel subsidy removal.

“We are faced with high inflation rate, high food prices, high electricity tarrif and high cost of transportation among others. Still salary remains the same.

“People are not finding it easy at all, they are passing through a lot, let the common man be happy ,’’ Nze said.

The National Bureau of Statistics (NBS), in its “Cooking Gas Price Watch’’ for January 2024, said that the average price of 5kg of cooking gas increased from N4,962.87 recorded in December 2023 to N5,139.25 in January 2024.

The NBS said the average price of 5kg of cooking gas increased on a year-on-year basis by 12 per cent from N4,588.75 recorded in January 2023 to to N5,139.25 in January 2024.

Analysis by zone showed that the North-East recorded the highest average retail price at N5,296.32 for 5kg cooking gas, followed by the North-Central at N5,240.36.

Minister of State for Petroleum Resources (Gas), Mr Ekperikpe Ekpo recently said it was interacting with critical sectors to halt exportation of LPG in view of its rising cost.

He said all LPG produced within the country would be domesticated to crash the price of gas.

Abuja, March 9, 2024: The Federal Government has inaugurated the Governing Council of the Midstream and Downstream Gas Infrastructure Fund (MDGIF) with the charge to spur investment.

Minister of State Petroleum Resources (Gas), Mr Ekperikpe Ekpo, inaugurated the council on Friday in Abuja.

He called on the domestic and international stakeholders to join hands with the management of the MDGIF to boost investments in the gas sector.

Ekpo, who is the chairman of MDGIF, said the fund’s mandate, which aimed at supporting the midstream and downstream gas infrastructure, aligned seamlessly with the aspirations of President Bola Tinubu’s administration.

He said the establishment of the MDGIF came at a critical juncture in Nigeria’s energy landscape when the strive for economic diversification and sustainable development with gas as a major component was at its peak.

He urged members to work toward surmounting the challenges of low investments, poor gas infrastructure in the midstream and downstream sectors and grow employment in the process.

“The MDGIF is not merely a fund; it is a vehicle for progress, a conduit for prosperity and a catalyst for sustainable development.

“This alignment should, in turn, lead to a tangible reduction in the prices of Liquefied Petroleum Gas (LPG) and Compressed Natural Gas (CNG0), benefitting particularly the low-income earners in our society,” Ekpo said.

The minister said with the collective expertise and commitment of the governing council, as well as the support of relevant stakeholders, it would drive innovation, create employment opportunities and ensure energy security.

Members of the MDGIF Governing Council include Mr Oluwole Adama, Executive Director; Mr Joseph Tolorunshe, Secretary and Mr Farouk Ahmed, Authority Chief Executive, Nigeria Midstream and Downstream Petroleum Regulatory Authority.

Others are: representatives of the Central Bank of Nigeria (CBN); Federal Ministry of Finance; Independent members — Ms Amina Maina (North-East); Mr Edet Ubong (South-South); and Mr Tajudeen Musa (South-West).

Abuja, March 6, 2024: Mr. Ned Nwoko has called on the Federal Government to urgently enforce the regulations on gas flaring and venting of natural gas in the Niger Delta region.

Nwoko who represent Delta North Senatorial District at the Senate, made the call on Tuesday in Abuja.

He said it was imperative to enforce the regulations, particularly as they affects Ndokwa land, in line with the provision in the Petroleum Industry Act (PIA) 2021.

The PIA, among other provisions,  demands strict adherence to a gas flaring and utilisation plans.

He said that in the petroleum industry, gas flaring represents the loss of raw natural gas when associated gas is extracted.

He explained that the loss may result from inadequate gas extraction, processing, and transportation infrastructure.

According to him, some oil and gas companies prefer to flare gas as it prevents the over-pressuring of their industrial plant equipment;

He further explained that gas flaring, a common practice in the oil and gas industry, was associated with wasted energy and causes lots environmental concerns.

He said it was a harmful practice which negatively impact on the host communities and a huge source of economic loss to the country.

He said the country’s the poor supervision of companies in the oil and gas sector, the mainstay of Nigeria’s economy had turned it into mixed bag of fortune for the citizens.

He said this was especially for the suffering experienced by host communities in Ndokwa East and West Local Government Areas, Ukwuani, and some parts of Effurun, all in Delta.

According to him, these communities are subjected to untold hardship and unabated health hazards caused by worsening gas flaring.

“Today, this harmful practice has resulted in the deaths of no fewer than 23 persons in the last six months, with many hospitalised due to excessive emissions of carbon dioxide in their communities”.

He, therefore, stressed the urgent need to stop gas flaring and enforce the anti-gas flaring regulations in the land.

Nwoko also sponsored a motion on “Urgent Need to Stop Gas Flaring and Enforce Anti-Gas Flaring Regulations in Ndokwa Land and the Niger Delta Region” in the Senate.

He called for increased penalty for gas flaring as a deterrent from further breach.

He also said that oil companies operating in Ndokwa land and the entire Niger Delta region should be directed to immediately switch to OP16 Gas Turbine.

The turbine uses advanced combustion technology to significantly reduce emission, ensuring a greener, more sustainable flaring solution, and effective resource management.

“Also the Federal Government should ensure that the estimated 2 million dollars per day lost to gas flaring be converted and commercialised to fund the national budget conveniently without resorting to borrowing.

“They should also be made to pay the sum of N100 billion naira only as compensation to the victims of gas flaring in Ndokwa land and the entire Niger Delta region.

“They should also ensure that the devastated environment is restored without further delay’’, the Nwoko said.

He further called on the Senate Committee (Upstream and Downstream) to liaise with the Nigeria National petroleum Corporation Limited and other relevant agencies to ensure immediate and total compliance with the Zero flaring routine.

Abuja, Feb. 28, 2024: The Federal Government says the Obiafu/Obrikom/Oben (OB3) Gas Pipeline will be completed in March 2024.

The Minister of State for Petroleum Resources (Gas), Ekperikpe Ekpo, made this known at the official opening of the 7th edition of the Nigeria International Energy Summit (NIES 2024) on Tuesday at the presidential banquet hall,  Abuja.

The gas pipeline runs from the Obiafu-Obrikom gas plant near Omoku, Rivers State, to Oben in Edo State.

The pipeline is being constructed  by the Nigerian National Petroleum Company Ltd. (NNPC Ltd.) and was initially intended to be completed by the end of 2017 but met technical challenges, including horizontal drilling under major rivers.

Ekpo, while announcing the completion deadline of the OB3 pipeline said the 42″ 127 km pipeline would supply two billion Cubic Feet (2BCF) of gas daily.

“Upon completion, this pipeline will provide the AKK pipeline with gas from the three fields of Obiafu, Obrikom, and Oben.

“I want to use this opportunity to appreciate the resilience of the NNPC Ltd. Group for their steadfastness and proactive approach to ensuring the timely completion of the OB3 pipeline project.

“The OB3 gas pipeline is a vital piece of gas infrastructure for the supply of feedstock to the Ajaokuta-Kaduna-Kano (AKK) pipeline, another milestone in our journey towards a gas-focused economy.

“OB3 is a construction phase natural gas pipeline, running from the Obiafu-Obrikom gas plant to the Oben node in Nigeria.

“I am pleased to report that significant progress has been made in constructing this critical infrastructure project, and we are on track to ensure its completion and inauguration as scheduled,” the minister said.

According to Ekpo, the pipeline is among Nigeria and Africa’s biggest gas transmission systems.

He said that the administration of President Bola Tinubu was fully committed to creating an environment that could enable the growth of the gas sector.

The minister also said that the administration implemented policies and regulatory frameworks that encouraged investment, promotion of innovation, and ensuring sustainability.

He said the gas industry, with abundant proven gas reserves of more than 208TCF and further exploration potential, was crucial for enhancing energy security.

“Nigeria is currently facing challenges as it continues the journey of National development. These challenges also present a unique opportunity to seize the moment and define the future.

“The nation is rich in natural gas reserves. It is now essential to strategically utilise these resources to drive economic development, job creation, poverty eradication and environmental sustainability.

“As we are all aware, over dependence on oil revenue poses significant economic risks for our nation,” he said.

The minister said that Nigeria had faced numerous challenges in spite of efforts to diversify the economy away from oil dependence.

He said innovation and strategic vision became imperative in times of challenge, adding that finance was essential for transformative endeavours, as the gas sector was no exception.

The minister said attracting domestic and foreign investments was key to unlocking the full potential of the country’s gas resources.

In his remarks, Mr Abdulrazaq Isa, Chairman, Indigenous Petroleum Producers Group (IPPG)/Waltersmith Group, advocated for accelerated oil and gas production and progressively investment for rapid growth.

He described Nigeria as the largest oil and gas producer in Africa, and the largest in most experienced indigenous workforce in oil and gas and financial services on the continent.

“I strongly advocate that the headquarters of the Africa Energy Bank, being midwifed by African Petroleum Producers Organisation (APPO) and Afrexim Bank be located in Nigeria.

“The concerted efforts through the leadership of the ministry of petroleum resources should be put in place to realise this,” he appealed.

Dr Omar Farouk, Secretary-General, APPO, in his remark said, the decision on where to locate the proposed African Energy Bank would be taken by the end of the first quarter of 2024 as seven countries including Nigeria have declared interest to host the bank.

Abuja, Feb. 23, 2024: The Federal Government says it is interacting with the critical sectors to halt exportation of Liquefied Petroleum Gas (LPG), also known as cooking gas in view of its rising cost.

The federal government said that all LPG produced within the country would be domesticated to crash the price of gas.

The Minister of State Petroleum Resources (Gas), Mr Ekperikpe Ekpo disclosed this at the opening of its Internal Stakeholders’ Workshop, on Thursday in Abuja.

The workshop which is across the gas value chain on repositioning the nation’s gas sector, has its theme as “Harnessing Nigeria’s Proven Gas Reserves for Economic Growth and Development “.

“All LPG produced within the country will have to be domesticated and when this is done the volume will increase and of course the price will automatically crash.

“I am in contact with the regulator, the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), and the producers of LPG such as Chevron, Mobile and Shell, we have meetings on daily basis.

“There is hope that things will turn around, we do not need to make noise about it and it is based on this that we having this engagement to find out the problems and address them once and for all,” Ekpo said.

On conversion of vehicles to Compressed Natural Gas (CNG), to cushion effect of fuel subsidy removal, Ekpo said he has been interfacing with the Presidential Initiative on CNG towards realising the goal.

He said, “the moment I get clearer picture about it, I will address you accordingly,’’ adding that the impact on withdrawal of taxes and levies from gas related equipment would not reflect that way, because the investors are humans and would like to maximise profit, though the policy has been put in place.

“But at the end of the day the regulators have to come in and interface with them to ensure they crash the price,’’ he said.

According to him, the demonstration by the federal government by withdrawing all taxes and levies from importation of gas related equipment is a big incentive.

The workshop also featured a presentation by Mrs Oluremi Komolafe, Director Gas of the ministry on highlights from the minister’s consultation with the operators in the nations’ gas sector in Feb. 6.

Speaking on the recommendations by the operators, she said they called for balancing gas pricing while considering the impact on the average consumer is imperative for sustainable sectoral growth.

Komolafe said the LPG retailers urged the Minister to look into the issue of soaring price of cooking gas as it had become relatively un-affordable to the common man.

She said the retailers highlighted that the surge in price was capable of jeopardising the clean cooking initiative and made the use of charcoal attractive and cheaper alternative.

“They also mentioned the issue of substandard gas cylinders as a great challenge and called on the Ministry to look into the issue and enact a national cylinder and accessories policy to curb it,’’ she said.

Cooking gas price increased to N1,400 as against N950 per kg in January, 2024.

Abuja, Feb. 16, 2024: The Nigerian National Petroleum Company Limited/TotalEnergies Joint Venture (JV) has achieved zero routine gas flare in all its assets.

This feat was announced on Thursday during an inspection of the Oil Mining Lease (OML) 100 in South-eastern Niger Delta, off Port Harcourt, by a joint NNPC Ltd and TotalEnergies Team.

The Chief Corporate Communications Officer, NNPC Ltd., Olufemi Soneye said this in a statement on Thursday in Abuja.

He said the inspection was to ascertain the success of the OML Flare Reduction Project inaugurated in December 2023.

Accordong to Soneye, the achievement is in pursuit of meeting the targets of 20 per cent (unconditional) and 47 per cent (conditional) greenhouse gas emission reduction.

He said the reduction target was contained in the Nationally Determined Contribution under the Paris Accord signed by the President Bola Tinubu administration.

“The NNPC Ltd/TotalEnergies JV, which is the concession holder of four leases, had hitherto achieved zero routine flaring across OML 99 (2006), OML 102 (2014), and OML 58 (2016), leaving OML 100 as the only lease with routine flaring going on.

“The significance of this achievement is that the last routine flare volume of Twelve Million Standard Cubic Feet Per Day (12MMscf/d) of gas, has now been eliminated giving rise to a greenhouse gas emissions reduction of about 341KtCO₂e/yr.

“The achievement is an outcome of a programme introduced by the NNPC Ltd to galvanise action towards achieving the zero routine flare by 2030 across its portfolio of assets,” he said.

He said the feat achieved was a testament to the NNPC Ltd’s prioritisation of sustainability anchored on the ‘first R’ of its 5R Strategy (Reduce, Replace, Renew, Re-plant, Repurpose), as it strived to reduce its carbon footprint.

According to him, work is ongoing across all other assets within NNPC Ltd’s Upstream Directorate to ensure that all assets achieve zero routine flaring by 2030 or earlier.

Lagos, Feb. 14, 2024:Mr Ekperikpe Ekpo, Minister of State for Petroleum Resources (Gas), has reiterated the Federal Government’s readiness to foster collaborations and partnerships that would facilitate national goals for domestic gas utilisation and export.

Ekpo said this at the 8th Sub-Saharan Africa International Petroleum and Exhibition Conference on Tuesday in Lagos.

The conference was organised by the Petroleum Technology Association of Nigeria (PETAN) with the theme: “The Next Steps: Accelerating African Content”.

Ekpo, who was represented by Mrs Oluremi Komolafe, Director of Gas Ministry of Petroleum Resources, said that the ministry had identified finance and investment in infrastructure as critical to the development of the gas sector.

According to him, as part of the tools to address this problem, the Midstream and Downstream Gas Infrastructure Fund, was put in place to enable government make equity investment in gas Infrastructure.

“As we gather to harness ideas to develop our energy sector, let us not forget the various incentives put in place by the government to encourage the gas sector development.

“These include three years tax waivers for companies that build and operate gas pipelines, and could be extended to five years at the satisfaction of the ministry.

“Also, recently, Mr President approved the zero duty and VAT for imported CNG and LNG,” he said.

Ekpo also said that existing tax waivers on imported gas equipment were geared toward deepening gas penetration in Nigeria.

He said, “The responsibility of developing our energy resources does not depend on government alone.

“It calls for collaboration, knowledge sharing, and commitment on the part of the private sector industry players, too, as government makes the right policies and creates the enabling environment for businesses to thrive.

“As we anticipate the kick-start of critical infrastructure such as the AKK, and the expansion of the Lagos-Escravos pipeline to Morocco and further to Europe, we call for collaboration to support existing Government initiatives.

“There is a huge demand for gas in Nigeria, and the sector is large enough to accommodate everyone.

“The minister also welcomed the ideas and ventures that could assist us bridge the gap existing between demand for gas and the low level of development of our enormous natural gas reserves.”

He said that the event was significant for the energy sector, especially at a period when energy transition and security are paramount.

He commended thee organisers of the conference for continuously promoting ideas and collaborating with African oil and gas players.

“In Nigeria, gas is not just a transition fuel but it is strategic to achieving a more secured energy future and as a catalyst for other national development goals,” he said.