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Tinubu to tackle power outages with two gas plants

Tinubu to tackle power outages with two gas plants...Continue The Full Reading.

The Federal Government is set to tackle the power challenges in Nigeria with an additional 500 million standard cubic feet of gas in the domestic market.

The government said it would also enhance industrialisation and create more jobs with more gas supply into the nation’s economy.

President Bola Tinubu disclosed this Wednesday while inaugurating three critical gas infrastructure projects executed by the Nigerian National Petroleum Company Limited, Seplat Energy and other partners in Ohaji-Egbema, in Imo State and Kwale, in Delta State.

In January 2024, Nigeria fell into nationwide blackouts due to gas shortages. The gas companies had refused to supply gas to electricity-generating companies due to unpaid debts.

Power generation that was hovering around 4,000MW dropped drastically below 2,500MW at a point, impacting the capacity of the distribution companies to supply electricity to their consumers.

As the president launched the expansion of the AHL Gas Processing Plant, the ANOH Gas Processing Plant and the 23.3km ANOH to Obiafu-Obrikom-Oben (OB3) Custody Transfer Metering Station Gas Pipeline projects, he disclosed that there would be more feedstock for the nation’s gas-fired thermal power plants.

Tinubu reiterated its determination to utilise Nigeria’s abundant gas resources towards revamping the nation’s industrial growth and kickstarting its economic prosperity.

“It is pleasing that approximately, 500MMscf of gas in aggregate would be supplied to the domestic market from these two gas Processing plants, which represents over 25 per cent incremental growth in gas supply. In practical terms, this translates into more gas for the power sector,” the President said.

According to Tinubu, he had from the time he assumed office, made it clear that his administration intended to leverage the nation’s virtually unlimited gas capacity to increase national power generation capacity, revitalise industries, and create multiple job opportunities for economic growth.

He noted that aside from the Presidential Compressed Natural Gas Initiative, which is aimed at moving Nigerians away from petrol and diesel as vehicular combustion fuel, significant progress has also been recorded in incentivising gas development through Presidential Executive Orders.

“The theme of this inauguration – ‘From Gas to Prosperity; Renewed Hope’, must be adopted by all gas-sector participants and would-be investors as a clarion call to ramp up efforts to accelerate investment and developments of projects in the gas sector on a win-win basis.

“I would once again commend the efforts of NNPC Ltd, alongside SEEPCO and Seplat Energy, on this business partnership initiative, and congratulate you all on the successful implementation of the three projects,” he added.

Tinubu described the event as a highly significant milestone for Nigeria as it demonstrated his administration’s efforts to accelerate the development of critical gas infrastructure to enhance the supply of energy.

He said the projects were fully in line with the Federal Government’s Decade of Gas initiative and his administration’s quest to grow value from the nation’s abundant gas assets while concurrently eliminating gas flaring and accelerating industrialisation.

The president assured investors that his administration was determined to improve the “ease of doing business”, in Nigeria’s oil and gas sector.

Earlier in his address, the Minister of State for Petroleum Resources (Gas), Ekperikpe Ekpo, had highlighted the efforts of the ministry to continue to champion the utilisation of gas as a transition fuel as Nigeria moves towards achieving clean energy efficiency and security by 2060.

Ekpo commended the president for his leadership and support towards the success of the three projects.

In his remarks, the Group Chief Executive Officer of the NNPCL, Mele Kyari, described the commissioning as a demonstration of the president’s commitment and support to grow the domestic utilisation of natural gas for power generation, as feedstock for gas-based industries and the overall rapid industrialisation of Nigeria on the back of the enormous gas resources in the country.

Kyari assured that, as part of its mandate, the NNPCL remains committed to maintaining energy security by executing more strategic gas projects for the benefit of Nigeria.

The AHL Gas Processing Plant 2 is an expansion to the Kwale Gas Processing Plant, which currently supplies about 130MMscf/d of gas to the domestic market.

The processing plant is designed to process 200MMscf/d of rich gas and deliver lean gas through the OB3 Gas Pipeline.

The additional gas supply will support further rapid industrialisation of Nigeria and also produce about 160,000 MTPA of Propane and 100,000 MTPA of Butane, which will reduce the dependency on Liquefied Petroleum Gas imports.”

The AHL Gas Plant is being developed by AHL Limited, an incorporated Joint Venture owned by NNPC Limited and SEEPCO.

Meanwhile, the ANOH gas plant is an integrated 300MMscf/d capacity gas processing plant designed to process non-associated gas from the Assa North-Ohaji South field in Imo State.

The plant will produce dry gas, condensate, and LPG. The gas from the ANOH plant will significantly increase the domestic gas supply, leading to increased power generation and accelerated industrialisation.

The ANOH Gas Plant is being developed by ANOH Gas Processing Company, an incorporated Joint Venture owned by NNPC Limited and Seplat Energy Plc on a 50-50 basis.

Third is the ANOH-OB3 CTMS Gas Pipeline Project, which the Presidency said involves the engineering, procurement, and construction of 36″x23.3km ANOH-OB3 Project.

“The Transmission Gas Pipeline will evacuate dry gas from the Assa North-Ohaji South primary treatment facility to the OB3 Custody Transfer Metering Station for delivery into the OB3 pipeline system,” presidential spokesperson, Ajuri Ngelale, said.

About 600MMscf/d is estimated to be available from two separate 2 x 300MMscf/d capacity gas processing production trains from AGPC & SPDC JV.

The ANOH gas plant attained mechanical completion in December 2023 without a single recordable Lost Time Incident across 12 million man-hours.

With a Phase One processing capacity of 300mmscf per day, the ANOH Gas Processing Plant Company is expected to deliver dry gas, condensate, and LPG to domestic and international markets.

Speaking at the commissioning occasion, Seplat Board Chairman, Mr Udo Udoma, emphasised, “The ANOH gas project strongly aligns with Seplat Energy’s mission of leading Nigeria’s energy transition with accessible, affordable, and reliable energy that drives social and economic prosperity. As a testament to our pledge to Nigeria, in partnership with the NNPCL, we have delivered this project that will support the current administration’s drive for industrialization and growth of the economy through low-cost reliable power.

“To put this into context, if all of the gas from this plant went into the power sector, it would produce enough electricity to transform the lives of over 5 million people. Given that Nigeria’s population is growing at a rate of over 5 million per annum, we need one of these plants every year to meet the demand of our new arrivals.  We all have work to do,” Udoma stated.

Commenting on the commissioning of the ANOH project, the CEO of Seplat Energy, Mr Roger Brown, stated that the company “is pleased with the progressive reforms by President Bola Ahmed Tinubu and his administration”.

Brown added, “In March 2024, the President signed executive orders to enhance investments in greenfield gas development and midstream capital projects. Also, the Nigerian Midstream and Downstream Petroleum Regulatory Authority recently improved gas prices under the DSO, to trigger further investments in the domestic gas sector – our ANOH gas plant will benefit from these reforms and incentives. “No doubt, the ANOH’s gas will further reduce Nigeria’s carbon intensity and increase energy supplied to the Nigerian domestic market.

“In February 2021, AGPC, successfully raised $260m in debt to fund completion of the ANOH project. The project is now fully funded following the completion of equity investments of $210m by each partner, making $420m combined.

“Seplat Energy is committed to maximizing the potential of the ANOH Gas Processing Plant and delivering value to all stakeholders. As the plant begins operations, Seplat Energy looks forward to harnessing its full potential and contributing to Nigeria’s energy transition journey.”...Continue The Full Reading.>’.

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