A Review of the Nigerian Energy Industry

Gas producers thwarted Jonathan’s stable electricity programme – Nebo

01 June 2015, Abuja – Immediate past Minister of Power, Prof. Chinedu Nebo, at the weekend disclosed that the outgone government of former President Goodluck Jonathan was unable to meet its target to upgrade Nigeria’s power generation from its current state because gas producers failed to live up to their supply commitment to the sector.

Prof Chinedu Nebo

Nebo alleged at a post-service assessment interview in Abuja on Sunday that plans of the immediate past government to generate over 5000 megawatts (MW) of electricity in 2014 and subsequently add more capacity were effectively bungled by the hypocritical approach to meeting the demands of gas power plants by gas producers in the country.
He explained that whereas the country produced up to five billion standard cubic feets (bscf) of gas per day, producers preferred to export about four billion standard cubic feet of that and dedicate one billion standard cubic feet for the domestic market, out of which over 60 per cent of it are mostly channeled to industrial users.
The former minister noted that consistently, demands for improved gas supply to the power sector were ignored by producers who opted to satisfy industrial consumers and often cited legacy debts owed to them by defunct Power Holding Company of Nigeria (PHCN).
He also stated that the situation did not improve despite the joint intervention of the Nigerian Electricity Regulatory Commission (NERC) and Central Bank of Nigeria (CBN), in which price and transportation of gas to power were reviewed to $2.80 and CBN commitment to offset the legacy debt.
“I hate excuses. But I would say that commitments were made to give us gas, but we haven’t seen gas. It is just as simple as that.
“It is very painful. I blame a lot on vandalism, but I also blame the oil companies for what I consider to be hypocrisy. They have been hypocritical with this whole issue of making sure that we have gas and bringing us out of darkness and so on,” Nebo said.
He further stated: “These turbines are ready to go. Some of them are operating at 30 per cent capacity. In a place where you have three to four turbines and only one is at work because there is no gas supply.”
“I think I feel so sad about this because if we had gas going to these turbines, every Nigerian would have been hailing President Jonathan today. But unfortunately, there was no gas.
When gas was produced, even more, you find a preference by the oil companies to give gas to the industries instead of to power generation. It is still happening today, whereas the profile for gas to power continues decreasing, the profile of gas to industries is on the  increase. Something is wrong,” he added.
According to him: “I think that it is scandalous that we produce over 5bscfs of gas every day and we sell 4bscfs and retain only 1bscfs for local use. And that the one for local use is preferentially given to industries and not to power, starving the power sector of the needed gas to industrialise this country and I think that is a shame.”
Nebo said that if the new government of President Muhammadu Buhari can fix the gas supply issue, it can as well improve on the country’s power supply following former President Jonathan’s commitment to upgrade the system’s infrastructure.
“The privatisation of the power sector set the ball rolling. The grid was unreliable, very unstable, and we didn’t actually have a national grid. It was under President Goodluck Jonathan that we had a national grid with the loop closed, making it really national, and not just all kinds of systems that you couldn’t really call national.
Today, instead of that radial structure, we have a grid that is more stable. We have a grid that is more reliable, and we have a power sector that is actually ready to take off to solve the power problems in Nigeria,” he said on investments committed into the transmission network.
In his advice to the new government, he said: “This new government should take a cue and make sure that NNPC does what it ought to do to make sure that there is enough gas going to the power plants.”
“It is very critical. If the new administration does not do that, Nigerians are going to keep suffering in darkness. I do hope that the administration would also fight vandalism and bring the vandals to their knees. If we don’t do that, we are still going to have a problem because a situation where every two weeks the pipelines are blown up and it takes two weeks to fix them is not the best,” added Nebo.

– This Day

In this article

Join the Conversation