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Stop Neglect of Natural Gas Infrastructure Now - TELL Magazine

Stop Neglect of Natural Gas Infrastructure Now

Oredo Integrated Gas Handling Facility (IGHF) project in Ologbo, Ikpoba-Okha local government area of Edo State
Oredo Integrated Gas Handling Facility (IGHF) project in Ologbo, Ikpoba-Okha local government area of Edo State

This twilight of Muhammadu Buhari’s All People’s Congress (APC) government appears a most convenient time to present the administration’s scorecard preferably in the form of reminding it of what it promised (and supposed to do as a people’s-oriented government which it claimed to be) but did not or has not done.  This will be with a view to informing the incoming government of whoever or whichever political party, of the unfinished businesses on very germane aspects of statecraft if it is to ‘outshine’ the outgoing one.

For instance, between May 29th 2015 and now, this government has always referred to infrastructural development as its areas of achievement. It makes bold to point fingers to such projects as railway line rehabilitation, the maintenance and construction of the third mainland and the second (River) Niger bridges respectively, linking of oil pipelines from the Niger Delta to the Sahara, road rehabilitations, among others. These are good, and in a way, solves some socio-political problems of the country. Perhaps more importantly, these landmarks will remain reference points as achievements traceable to the regime. 

Though the present government provided in the National Gas Policy, NGP (2017) that it had a mission to turn Nigeria from an oil to a gas-based industrial economy, the 9points’ core values or strategies in the policy for its actualisation… Share on X

But there are what is herein referred to as ‘more important infrastructures’. In this context, it is used to refer to such projects which both affects the entire segment as well as more pressing need of society: such things that attends to the basic needs of the people and touches and affects the lives of everybody directly and indirectly. Such infrastructures meet basic needs and at the same time, boasts the productive sector of the nation’s economy. Three of such – electricity, refinery and gas processing infrastructures are identified, but the focus in this edition will be the gas processing infrastructure. The other two should come up in subsequent editions. Put together, they can best be described as critical infrastructures which, if put in place, will fix the country on virtually every facet.  

The policy on natural gas contained within the National Energy Policy, NEP, (2003) states interalia, that, “the nation shall put in place necessary infrastructure and incentives to encourage indigenous and foreign companies to invest in the industry”. Furthermore, the policy provides that, “the nation shall put in place necessary infrastructure and incentives to ensure adequate geographical coverage of the gas transmission and distribution network” (NEP 2003:14). ‘Necessary infrastructure’ here refer essentially to gas pipelines needed for the transportation or wheeling of gas from the generation to the distribution networks in the gas value chain. Experts say these infrastructures are needed for processing of natural gas for the market. But because these infrastructures are inadequate, Major Oil Companies (MOCs) resort to burning off (flaring) the gas so they can have access to oil which is what they need (and not gas) as the oil is said to be domiciled and under gas deposits in the same well or reservoir. 

Thus, the lack of or inadequacy of the infrastructure has been adduced as a potent factor for continued gas flaring. In other words, and as claimed, if the infrastructures were to be available in the needed proportion, the gas would be processed as appropriate so that there probably won’t have been the need for them to be flared as is and has been the case. Although certain reports reveal that the spate of flaring had reduced, more recent ones have not really been impressive. The country still ranks high among global gas flaring countries as it is grouped among the seven countries that accounted for 2/3 of global gas flaring in 2021, according to a World Bank report. Furthermore, estimation puts the equivalent of the volume of gas flared in the first half of 2022 to carbon-dioxide, C02, emission of 6.7 million tonnes in the oil producing areas, 4.56 percent higher than the 120.5 Billion SCF of gas flared in the second half of 2021, and capable of generating 12,600 Gigawatts hours of electricity. ThisDay newspaper report revealed new data from the Nigerian National Petroleum Corporation (NNPC) that as much as 10.027 Billion Standard Cubic Feet (SCF) of gas was flared in December 2022 as against the 9.3Billion bunt in the previous month. Meanwhile, Nigeria’s present proven gas reserve is put at 180. 490 MCF (Million Cubic Feet), making it to rank first in Africa and the ninth globally. However, much of this reserve, which is even said to be more than oil deposit, is lost annually through flaring and venting. 

This problem of gas flaring has been of great concern to successive governments especially that of Chief Olusegun Obasanjo. Though the present government provided in the National Gas Policy, NGP (2017) that it had a mission to turn Nigeria from an oil to a gas-based industrial economy, the 9points’ core values or strategies in the policy for its actualisation seem not to have been implemented let alone finding a way around the issue of flare reduction or outright phasing off of it. The highest it went on this was the setting up of the Nigerian Gas Flare Commercialisation Policy (NGFCP) in 2019 which though was to demonstrate its commitment to improving the gas sector. This, however, is apart from coming up with a substantive National Gas Policy, NGP (2017) and the Flare Gas (Prevention of Waste and Pollution) Regulations (2018). Put straight, the NGFCP, (2019) was designed, ostensibly on the realisation that flaring and venting activities had constituted major threat to the development of the natural gas sector in the country. However, the provision of the critical infrastructures for gas transmission is pivotal to the realisation of the avowed gas-based industrial economy. The direct consequences of this state of inadequate gas processing infrastructure are obvious. For instance, indigenous and foreign companies won’t be encouraged to invest in the nation’s gas sector as the case is presently, and adequate geographical coverage of gas transmission and distribution won’t be achieved as intended, among others.

The present administration is not ready to embark on any programme; it is not even advisable because it will result to leaving humongous debts or uncompleted projects for the incoming administration… Share on X

Meanwhile, this lack of gas processing infrastructure has been considered by analysts as one of the critical problems threatening the growth and development of the Nigerian natural gas industry. As earlier indicated, it has resulted in continuous venting and flaring of it as there are no means of processing them for the market. This gas flaring has far reaching economic, environmental and health implications. Though successive governments have made efforts both at reducing gas flaring and provision of infrastructures through policy and strategic approaches, Multi-national Oil Companies have not really been co-operating with the government in its flare reduction policies. This, as revealed, has been for very obvious reasons. One, government itself is an equal player in the oil and gas market, and by implication, assumed to be equally involved in the process of flaring and venting through its corporation, the Nigerian National Petroleum Corporation Limited (NNPCL) and its subsidiaries. Government, which is churning out these anti-flaring policies is seen to be possessing dual status of both a regulator on one hand and an operator on the other. It thus appears to these MOCs as if government is unserious in its effort at stemming the tide of gas flaring. They, that is the MOCs, had rather paid prescribed fines (for flaring) and get on with the practice than commit themselves to the capital-intensive process of provision of processing infrastructures.  

From the body language of the president himself, the present administration is not ready to embark on any programme; it is not even advisable because it will result to leaving humongous debts or uncompleted projects for the incoming administration of God knows who. In short, no right-thinking person should expect it to attend to any issue now. This is in strict consideration of its modus operandi right from inception, as Nigerians cannot pinpoint to tangible achievements of the administration. As far back as January 2018, former president Olusegun Obasanjo, while warning Muhammadu Buhari not to contemplate going for a second term, told him that he had nothing anymore to contribute to the nation. Although the said former president was widely criticised, in government and ruling party circles, the turn of events within the administration’s performances seem to have vindicated the Owu chief. Rather than heed to such and other constructive criticisms, it has, through some of his very notable aides been covering its ineptitude and chastising such critics. Like the proverbial Agama lizard which fell from an iroko tree that said it would praise itself if no one did, the president and his cronies including the party in power alone had continued to sing-praise the government for its ‘performances’ which are not noticeable or too convincing to discerning minds.  

Therefore, for anyone to expect the present, better still outgoing government of Alhaji Muhammadu Buhari to attend to the knotty issue of provision of gas infrastructure will be tantamount to one asking for too much and perhaps living in a fool’s paradise. This article is simply informing the incoming government of whoever that there are critical unfished businesses. In other words, that government is hereby forewarned, in order for it to be forearmed, that it should pay attention to addressing this problem of inadequate gas infrastructure which has so far prevented the country that is so blessed with enormous resources from gaining immense wealth and riches from especially the abundant gas resources. The inadequate supply of this infrastructure has also been responsible for inadequate supply of gas even for domestic use. Above all, if this problem is not solved, the plan to turn the nation to a gas-based industrial economy as spelt out in the NGP (2017), might just be a mirage. 

Mokuye sent this piece from ILESA, in Osun state. He can be reached through smkuye@gmail.com  08061645953

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