Federal Government is seeking investors that would be off- takers of the gas being flared by joint venture companies in order to save the country some $800 million losses it suffers annually.
Justice Derefaka, programme manager, Nigerian Gas Flare Commercialisation Programme (NGCP) in the office of the minister of petroleum resources, disclosed this on the sidelines of the ongoing West African International Petroleum Exhibition and conference holding in Lagos.
Derefaka said the government was ready to invoke the section of the Petroleum Act, which gives the minister of Petroleum Resources the power to take the gas being flared and commercialise it.
Nigeria flares about 289 billion standard cubic feet of gas annually. The power sector by comparison uses 700 million standard cubic feet of gas per day.
Meanwhile, some of the stakeholders that spoke at the conference warned that unless strategic gas infrastructure like the Escravos-Lagos Gas Pipeline, proposed Ajaokuta and Kaduna and Kano gas pipeline, East – West Gas pipeline under construction are private sector driven they are not likely to attract the type of investments that would make them sustainable.
According to them, the government should just be an enabler and allow the private sector to take full charge of the operations of such infrastructure in order to attract the necessary investment in the gas subsector.
Austin Avuru, managing director of Seplat Petroleum Development Company, said that if the gas pipelines and power infrastructure currently being constructed are to be viable and not go the way of government owned infrastructure such as the refineries, Ajaokuta steel project, the Nigerian Railway Corporation and Nigerian Airways, then the private sector must be allowed to take charge of running the projects.
He said issue of the Nigeria Gas Company that manages the gas pipelines is very worrisome as it may not efficiently manage the infrastructure successfully to the satisfaction of other stakeholders in the gas industry, especially when the running of the gas pipelines becomes more technical and complex.
“It is true that the government is making efforts to double the gas in-take of Escravos-Lagos Gas Pipeline from one billion standard cubic feet of gas per day to two billion standard cubic feet of gas per day, the Ajaokuta to Kaduna and Kano proposed gas pipeline is not going to be a standalone pipeline as it going to feed from another pipeline. So, if anybody is investing in the AKK pipeline, he must ask himself where the gas pipeline to feed the pipeline is coming from. The investors must look at it within that context,” he said.