Posted by News Express | 5 September 2021 | 626 times
Amidst reports that domestic gas prices in the country are skyrocketing, it is an understatement, and a big shame to say that Nigeria’s huge gas resources are grossly under-utilised, notwithstanding that the country is potentially a leading gas producer in the world. The move by the Federal Government and the Central Bank of Nigeria (CBN) to expand gas utilisation in the country is a step begging for implementation; but it must be done properly if the desired objectives are to be achieved.
With over 206 trillion standard cubic feet of gas reserves, Nigeria ought not to lack gas to meet her various domestic and industrial gas needs. Unfortunately, the reverse is the case. Product utilisation remains dismal as over 56 per cent of the consumed gas resource is reportedly imported. Indeed, following Nigeria’s gas reserves and a projected growth rate of over 70 per cent by 2025, the nation’s gas sector is easily capable of being a key player in the emergent global natural gas market. Unfortunately, even with this huge gas reserve, not much has been accomplished regarding effective exploitation and utilisation of this abundant natural resource.
A lot of this gas reserves is termed ‘stranded’ with its volume and location often considered as non-commercial and difficult to exploit. To worsen the tragic scenario, most of the nation’s natural gas production has been flared or re-injected to enhance greater crude oil recovery over many years, and up till the present moment. It is established that if properly and efficiently harnessed, gas utilisation can improve electric power generation, stimulate mass employment, and impact positively on emergent global climate change caused by green house emissions from flare-out. But this will be until ways are found to exploit and utilise the gas reserves and turn it into a booster of the nation’s economy.
Electricity-generating companies frequently run out of gas, thereby, worsening the energy situation and keeping generation at below 5,000 megawatts. Homes and industries either buy the commodity at a high rate or face shortage. The current intervention announced recently in Abuja by the Permanent Secretary, Ministry of Petroleum Resources, Bitrus Nabasu, is to domesticate the development of the gas resource and allow indigenous players to advance the sector.
To be financed under the Power and Airlines Intervention Fund (PAIF), in line with existing guidelines and regulations of the fund, the initiative, will according to Nabasu, be an elixir to investment for infrastructure development with a view to optimising domestic gas resources for economic growth while spurring product processing, small-scale petrochemicals and gas cylinder manufacturing plants, as well as re-gasification modular systems.
Nabasu stated that the intervention would encourage motorists to use Compressed Natural Gas (CNG) and provide resources for power generation firms besides encouraging the use of Liquefied Natural Gas (LNG) for cooking, transportation and power. Three million jobs are expected to be created across the value chain while government would promote awareness and micro-retailing outlets across the federation. It has been noted that the commodity might not be affordable except its development is domesticated.
There is no doubt that the Nigerian economy needs huge capital through foreign direct investment from foreigners or Nigerians into critical sectors or industries. It needs serious infrastructural investment. A key policy objective of sustainable economic development, especially, in a developing country like Nigeria, is to establish energy development paths that are both economically efficient and sustainable.
Natural gas has the enormous potential to diversify and grow the Nigerian economy, power its industries and homes, produce ever-so-lacking wealth, create jobs, develop associated industries in the petrochemical sector and lift people out of poverty, among others. In the words of the Minister of State for Petroleum Resources, Timipre Sylva, who declared 2020 as the year of gas for the nation: “We could give light to our people; we could power our industries, releasing them from the handicapping dependency on diesel generators that make it all but impossible for them to be competitive.
“We could relinquish ourselves from dependence on imported fuel for power and heat, we could create new opportunities for job creation and industrial development; we could take millions of people out of poverty. Furthermore, strong domestic gas and gas-based industries could help boost intra-African trade, create new synergies with our neighbours, boost integration of power generation networks, establish new partnerships, and even contribute to peace.”
Indeed, there is no doubt that Nigeria needs gas domestically. Electricity supply remains intermittent, despite successive administrations putting gas at the centre of their power sector reforms; and private citizens are groaning under the weight of high cooking gas. The minister’s expression is a dream that can come true, not by mere wishful thinking but through assiduous work to make the dream come true. One of the cardinal projects will be to remove the inhibition of gas distribution to households and industrial plants, which is being hampered by a lack of investment in power and gas distribution infrastructure, in part due to market uncertainties.
Nigerian gas reserve estimate indicates an inherent possibility of exploiting the country’s gas reserves for at least the next 100 years with the potential for a further 600 tcf in undiscovered reserve. The Federal Government and CBN joint intervention on gas utilisation expansion is a worthwhile initiative, and should be pursued with vigor to prevent it from becoming another pipe-dream.
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