How to monetise Nigeria’s gas resource – SPE

Shell gas flare at Kolo Creek - surrounded by green vegetation.

Shell gas flare at Kolo Creek – surrounded by green vegetation.

27 July 2015, Lagos – THE challenge posed by gas pipeline vandalism and the fall in oil prices has raised the need for Nigeria to look inwards to exploit its gas potential, the Society of Petroleum Engineers SPE, Nigeria council has said

Its President, Mr. Emeka Ene, expressed concern about the stranded gas that is flared, saying it is not only denying the nation of the much-needed revenue, but also destroying the environment and increasing green house gases.

Ene said in view of the inadequate pipeline network to enable access the resource by Nigerians and the vandalism of the pipes, it has become important to find other ways of taking the commodity to end-users.

He urged Nigeria to develop a reliable and sustainable model for gas flaring, identify and get more markets for gas.

He said: “The strategy for monetising stranded gas is for Nigeria to identify and secure its closest markets, develop an integrated flare-out model, recognise that associated gas (AG) is not non-associated gas (NAG), therefore, appropriate exploitation and utilisation should be put in place for stranded gas, size the process of every project aimed at actualising this objective based on average throughput, and modularise gas processing plant as a solution as exemplified by the Xenergi Company in Kwale, Delta State, Nigeria.”

Quoting the Department of Petroleum Resources’ (DPR) data, he said about eight fields account for 80 per cent of stranded flares.

He lamented the impact of oil theft and pipeline vandalism on the economy and environment, noting that the degradation is high, especially with the illegal oil refining.

He noted that the activities of these thieves and vandals have grave consequences on employment and the economy.

He said: “The direct impact include expansion and mainstreaming of a rogue economy, threat to industry and national security, further degradation of environment and loss of livelihood, destruction of socio and traditional fabric and values, political instability at local government areas level in the Niger Delta region.”

To demonstrate the extent of pipelines vandalism in the Niger Delta, he said pipeline rupture rose from 200 in 2002 to over 3,500 last year. Therefore, to accelerate monetisation of stranded flared gas, he said the government should fast-track captive power, gas powered public transportation, liquefied petroleum gas (LPG) substitution programme, and implementation of the pipeline network code.
*Emeka Ugwuanyi – Nations

About the Author