A Review of the Nigerian Energy Industry

Nigerian Gas Transportation Network Code gets under way

Kunle Kalejaye 10 August 2015, Sweetcrude, Lagos – The Department of Petroleum Resources, DPR, has announced the take off of the implementation of the Nigerian Gas Transportation Network Code, NGTNC.

Mordecai Danteni Baba Ladan,, Director, DPR

The NGTNC is a contractual framework between transporter (or network operator) and network users (known as shippers) that provides the latter open competitive access to existing and future gas transportation infrastructure.

According to the code, every gas meant for domestic use either for power generation or petrochemical and industrial production, will have a single entry and exit point to cut short the sharp practices prevalent in the current supply and distribution system.

Director of the DPR, Dr. Bala Ladan, who disclosed this at the just-concluded Society of Petroleum Engineer, SPE 2015  ‎Conference and Exhibition in Lagos, said stakeholders in the sector had earlier met in Abuja, the Federal Capital Territory, to discuss on way of ensuring smooth implementation of the code.

Represented by Mr. Gbenga Olufade, Dr. Ladan, said part of the implementation exercise of the NGTNC is the training of 20 personnel outside the country under the the guidance of foreign partners.

Mr. Olufade added these steps will help eradicate lots of bottle neck issues in the system adding that gas flaring in the country might end in 2020 but adequate funding is required to achieve it.

‎Meanwhile, Nigeria Gas Company has hinted that gas supply to power plants will increase to 800 million standard cubit feet by the end of 2016.

The increased supply of gas to power plants according to Mr. Dafe Sejebor the Managing Director of NGC, will be done on a willing-buyer-willing-seller basis.

Although the willing-buyer-willing-seller agreement is currently ongoing, NGC wants government need to implement the $2.50 for the price of gas which will help gas supplier break even in the market.

The successes of increase gas supply to power plants, according to Sejebor also depend on adequate regulatory frame work on the commercial side of the sector.

“Regulation has a major role to play for effective gas supply. Regulation should be looked at more on a commercial basis and we don’t want to forget that time is of essence. Government should implement regulations on time,’” Sejebor said.

Participants in the panel session agreed that gas infrastructures need to improve on as quickly as possible which will open the gas market stressing that government has ‘no business in business.’

In this article

Join the Conversation