Nigeria to grow domestic gas consumption from 1.7bn to 5.4bn by 2019

The Nigerian National Petroleum Corporation (NNPC) said it had put structures in place to grow the domestic gas consumption from 1.71 billion cubic feet to 5.4 billion per day by 2019.

The Group Managing Director of NNPC, Mr Andrew Yakubu, disclosed this on Tuesday at the 2014 Nigeria Oil and Gas Conference and Exhibition in Abuja.

According to him, the prevailing gas infrastructure component of the Gas Master plan is designed to increase domestic gas consumption three fold to 5.4 bcf per day by 2019.

He said that the country’s reserves stood at 36 billion barrels of oil and about 182 trillion cubic feet (tcf) of gas and produced an average of 2.2 million barrels of oil per day in 2013.

“In Africa, only Libya has more oil reserves than Nigeria and despite new discoveries in Sub Saharan Africa, especially in Mozambique, Nigeria still has undiscovered gas potential of about 600 tcf,” he said

Yakubu said that the discovery of the Ogo field in 2013 with reserves of about 750 million barrels showed that the Nigerian Delta remained one of the most prospective areas in the world.

He said that the availability of production allowances would also provide a welcome boost for small fields and profitability would increase in the proposed Petroleum Industry Bill (PIB) currently before the National Assembly.

“Nigeria’s quest to grow its reserves is promoted in the PIB,” he said.

This, he said, was done through a robust acreage management system to be superintended by the Upstream Petroleum Inspectorate involving the release of acreage that had been held without activity.

Yakubu said that in the new exploration paradigm shift, reserves and production decline from existing fields were driving the leading oil and gas companies to formulate new strategies and partnerships.

He said that the likes of Afren had recently discovered large quantities of resources in the West Offshore Lagos (Ogo Fields).

Yakubu said that global rationalisation of asset portfolio by International Oil Companies (IOCs) had led to divestment of some Nigerian onshore blocks.

He said that this had in turn created opportunities for new companies to partner indigenous companies.

“For example, the Shell divested blocks, which were initially being funded from joint venture cash call is now being funded by new investors.

“This has freed the government from the burden of annual cash call funding.

“In the case of Nigerian Petroleum Development Company, NPDC, the onus is now on the company to arrange funding for the acquired equity,” he said.

Yakubu said that all the strategies to keep Nigeria as a leading producer of oil were hinged on the passage of the PIB to remove the uncertainty surrounding the future fiscal framework in the oil and gas sector.

“The passage of the PIB will promote transparency, accountability and good governance and level playing field for players in the Nigerian oil industry.

“This will doubtless attract the much needed investment in the Nigerian Petroleum Sector,” Yakubu said.

Yakubu said that in spite of the above strategies to remain a leading player, Nigeria had faced unprecedented challenges with regards to losses in production.

This, he said, was occasioned by incessant vandalism of crude oil export pipelines and domestic crude oil and petroleum product pipelines.

Yakubu said that a number of initiatives had been taken to tackle these challenges and ensure that the country maintained its leading position in oil production in Africa. (NAN)