A Review of the Nigerian Energy Industry

Dynamite attacks on gas lines are acts of sabotage – Govt

Gas pipeline*20 points attacked in six months, repairs to cost N800m

Oscarline Onwuemenyi

20 January 2014, Sweetcrude, Abuja – The Federal Government on Monday described attacks on pipelines conveying gas to power plants across the country as acts of sabotage that has led to the loss of about 1600mw of power.

Group Managing Director of the Nigerian National Petroleum Corporation, NNPC, Andrew Yakubu told reporters in Abuja that about 20 points on the 56km Escravos to Lagos pipelines alone were attacked by the vandals with dynamites in the past six months.

Yakubu who put the cost of repairing the damaged points at N800m, noted that unlike crude pipelines which are targeted by crude oil thieves, it was difficult to understand while gas pipelines are being attacked when the product cannot be stolen.

He explained that as at last weekend, over 30 percent (480MMsf/d) of the installed gas supply capacity was out due mainly to vandalism.

He also attributed the low supply of gas to power plants on faulty equipment at the Utorogu gas plant in Delta State.

According to him, when the first incident occurred in June last year, initial assessment placed the cost of repairs at N200million but sequent attacks have now escalated the cost.

He listed the pipelines involved to include: the Escravos-Warri stretch of the Escravos Lagos Pipeline System, ELPS, which accounts for (190mmcf/d), the Trans-Forcados crude pipeline (230mmcf/d).

“When the initial assessment was done before we realized that there were many other points, the assessment was set at about N200m. But as we speak today because of the multi ruptures that were discovered later, I hear that it is about N800million. And before the close of the contract, if we pressure test and the lines are okay and we are able to flow gas then we will sit down and assess the total cost of the repairs and we will now demobilize the contractor,” he noted.

Yakubu further disclosed that “at the last count, 20 ruptured points have been identified, all due to deliberate dynamite explosion. NGC completed repairs in November and on commissioning in December, rapid pressure loss was experienced indicating further rupture in weakened locations.

“We have since effected repair of these new points and re-commenced commissioning activities.

He added that, “The cumulative effect of the above interruptions is a real degradation of power supply to Nigerians. The Ministry of Petroleum and NNPC continue to make effort to assure gas supply in a difficult environment. It is expected that a major improvement in power supply should be achieved in the weeks ahead as the various repairs are completed.”

He, however, assured that normal gas supply would resume in the next three to five weeks, adding that beyond the ongoing repair works, many projects are ongoing to bring in additional supply to bridge the growing demand by the power sector.

“By the end of Q2/Q3 2014, additional 200mmcf/d of gas is expected from two NPDC projects at Utorogu and Oredo. In addition, with the planned completion of the Omoku and Alaoji NIPP power plants, further boost in generation is expected as both plants have gas supply available awaiting completion of the power plants,” he explained.

Yakubu stated that in 2015, many other projects are expected to mature progressively and by 2016 when the East-West pipeline is completed, a major boost in supply will be attained as over 250mmcf/d of gas stranded in the East will be diverted to meet the growing Power demand.

He warned however that “if the occurrence of pipeline attacks is arrested, we expect nothing but a continuous and steady upward growth in gas supply to power from the end of this month, with a noticeable increase in electricity seen by Nigerians.”

He also disclosed that as part of effort to encourage more gas suppliers to sell gas to power plants, plans are afoot to increase the price per cubic gas to $1.5.

The price of gas supply to power was increased two years ago from $0.1 to $1.0 by the government to encourage suppliers to sell to power plants.

Minister of Power, Chinedu Nebo had last month complained that despite attacks on gas pipelines, gas suppliers continually met their obligations to industrial users of gas while shutting down supplies to the power plants. He attributed this to the low price of gas to power compared to other users.

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