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Ghana, Togo, Benin increase demand for Nigerian gas

By BusinessNews Staff on October 13, 2014

The demand for Nigerian gas is fast rising in Africa following a fresh appetite for the resource in countries like Ghana, Togo, Benin Republic, among others.

Currently, the idle capacity of the West African Gas Pipeline operated the West African Gas Pipeline Company has been put at 474 million standard cubic feet per day; and this deficit, our correspondent learnt, has informed the demand for Nigerian gas to close some of the existing gaps.

The pipeline is said to be getting less gas for its capacity, which stakeholders say is undermining the dividends of economies of scale.

The pipeline can currently carry an initial volume of 170MMscfd and has potential to carry additional volumes of up to 474 MMscfd.

These African countries are said to be engaging gas producers in Nigeria to sign a contract or Memorandum of Understanding that would guarantee additional gas supply to reduce significantly the idle capacity on the pipeline, a stakeholder involved in the project disclosed to our correspondent.

WAGP’s present contractual volume is 132MMscfd and WAPCO recently said it was positioning itself to make available its sub regional infrastructure to transport more gas. It also highlighted pipeline safety and improvement in pipeline utilisation as two priority areas it was focusing on.

The General Manager, Corporate Affairs, WAPCO, Mrs. Harriet Wereko-Brobby, had also confirmed that the declaration of “open access” for the pipeline in July 2012, had paved the way for WAGP to be available to other shippers aside NGAS.

WAPCO transports gas based on agreements between a shipper, NGAS and its customers, CEB in Togo and Benin and The Volta River Authority in Ghana.

To this end, she said, WAPCO had held a number of fora that brought together gas producers, transporters, marketers, regulators and power generation companies.

These fora, according to her, served as avenues for increased interaction between current and potential buyers, sellers and shippers on the WAGP, which WAPCO expects to ultimately lead to increased business for WAPCO.

Wereko-Brobby said as the company is working on increasing the volume of gas it transports; it is also working to ensure the pipeline is secure from third party damage.

The Nigerian National Petroleum Corporation said recently that it was looking for more markets for the nation’s gas on the European continent.

The move, it said, was meant to generate maximum economic benefits from Nigeria’s enormous gas resources.

The Group Managing Director, NNPC, Mr. Andrew Yakubu, had disclosed this while playing host to a Belgian business delegation under the auspices of the Flanders Investment and Trade Mission in his office.

“Europe is a good market for gas. Incidentally, Belgium has important terminals such as the Port of Antwerp through which Nigeria hopes to get its gas to the rest of Europe. We’ll start marketing our abundant gas resources to Europe,” Yakubu said.

He said the NNPC would strategically position itself to attract investments to boost the nation’s economy, adding that “gas is a strong mechanism for not only power generation and job creation, but also for growth and development.

He reiterated the need for collaboration between foreign investors and Nigerian businesses in order to domesticate the gas industry in the country.

The leader of the delegation and the Belgian Ambassador to Nigeria, Dirk Verleyen, according to the statement, said no fewer than 60 Belgian companies had indicated interest to invest in Nigeria.

He said Belgian companies wishing to invest in Nigeria cut across various sectors such as energy, telecommunications, construction, transport, postal service, entertainment, engineering and agriculture.

The Managing Director, Frontier Oil, Mr. Dada Thomas, had said more investors were needed in the gas business considering the huge market for the product in the country.

According to him, liberalisation of the Nigerian gas market will not only make the product available, but will also build confidence among potential bankers and lenders to commit funds to gas projects with the assurance that their money will be realised.

Thomas maintained that there was the need to develop the country’s gas distribution infrastructure so that gas could easily be moved from locations of availability to locations of need.

“Liberalisation of this market will encourage more investors to come in; and when they come in, the issue of gas infrastructure will, to a large extent, be addressed; and the Nigerian economy will be good for it,” the Frontier Oil boss said.

[Punch]

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