…as DPR reacts
08 August 2017, Sweetcrude, Lagos — Fresh figures have shown that Nigeria’s gas operators were unable to meet the domestic gas demand obligation from 2008 to 2015.
According to graph obtained from the Department of Petroleum Resources (DPR), and analysed by SweetcrudeReports, there was a huge gap in terms of the country’s gas supply obligation and the actual supply.
The graph showed that in 2008, Nigeria had a supply obligation of 2,231 million standard cubic feet per day (mmscf) in demand, however, was able to get below 1000, 800mmscf per day in supply.
In 2009, demand for gas rose up to 3,000mmscf per day but consumers got again around 800mmscf/d supplied.
Again, demand rose in 2010 to 3,800mmscf/d yet, supply remained constant with same 800mmscf/day.
In 2011, demand shot up further to a little above 4000mmscf/d but this time, supply rose a little above the usual 800mmscf/d to 900mmscf/d.
The inability of the operators to meet the Domestic Gas Supply Obligation administered to them for the 2008-2015 period is not in line with the provision of the Nigerian Domestic Gas Supply and Pricing Regulations (NDGSR), 2005.
The increasing National Obligation from 2,231 in 2008 to 5,073 MMSCFD in 2013 is in line with the projected National Gas Demand for the Strategic Power, Industrial and Commercial sectors at the time.
In 2012, demand climbed to about 4,800mmscf/d, but supply still managed to crawl to about 1,100mmscf/d.
2013 never saw any improvement in terms of supply. Although domestic demand rose to 5,073mmscf/d, supply dropped from 1100mmscf/d the previous year, to 1,000mmscf/d.
And in 2014, while demand dropped to 3,900mmscf/d, supply rose to about 1,200mmscf/d from the previous year’s 1000mmscf/d.
Lastly, in 2015, demand rose to about 4,500mmscf/d while supply also rose to 1,300mmscf/d.
Due to the inability of gas operators to meet with up with demands, the National Demand Supply Obligation (DSO) for 2014-2018, was re-calibrated by the DPR based on several variables and inputs from the Gas Aggregation Company of Nigeria.
This is responsible for the reduction of the National DSO to 3.94 BSCFD in 2014; which will progressively increase to 6.38 BSCFD by 2018.
On the average, only about 950 MMSCFD was supplied during the reviewed period with an annual performance ranging between only 20 and 35%.
“The supply short-fall from operators is as a result of a number of issues spanning from lack of commitment of Gas Producers, preference of producers for export market, inadequate pipeline infrastructure, slippages in project execution, budget constraints, failure of commercial negotiations, failure of swap deals, and non- readiness of off take plants, amongst others”, DPR told SweetcrudeReports while reacting to the issue.