Okunbor
Unlocking challenges in Gas –to-Power Value Chain is critical to improving access to Energy.
The Country Chair, Shell Companies in Nigeria, and the Managing Director Shell Petroleum Development Company of Nigeria, Osagie Okunbor stated at the 2021 NAEC International Conference of the Association of Energy Correspondents of Nigeria, NAEC.
The 2021 NAEC International Conference with Theme “Petroleum Industry Act, PIA: Energy Transition and The Future of Nigeria’s Oil & Gas” was held on Tuesday, November 2, 2021 in Lagos.
Okunbor who was represented at the event by Henry Ubong, the Managing Director, Shell Nigeria Gas, commended the leadership of Association of Energy Correspondents of Nigerian, NAEC, for sustaining a forum like this to help our country and our industry review important decisions and actions to get best outcomes.
“Gas remains the cheapest energy source for local manufacturers. Gas is a major source of power which drives industrialisation and economic development. The constant availability of gas plays a key role in stabilizing and even stimulating growth in the manufacturing sector”, he added.
Okubor said according to the latest estimate from the Nigerian National Petroleum Corporation, NNPC, Nigeria has around 202 trillion cubic feet of proven gas reserves and about 600 million cubic feet of unproven reserves.
“Harnessing this vast gas resources, and on time too, I believe, is key to development of the country. Currently, he said 85 million Nigerians, include the vast businesses, do not, have access to grid electricity. Unlocking the challenges in the gas-to-power value chain is therefore critical to improve access to energy for Nigerians”, he maintained.
He said the federal government of Nigeria has made it an economic priority to harness the potential of its natural resources to bring power and prosperity to its people.
“This priority includes the plans to develop the gas sector to drive domestic economy and to drive export as the energy transition demands increased supply of fuels like natural gas. Natural gas emits between 45 to 55 percent fewer greenhouse gas emissions and gas emissions and less than one-length of the air pollutants than coal when used to generate electricity.
To achieve this, he said the federal government had declared 2020 as “The Year Of Gas” in Nigeria and it launched two flagship projects (AKK and ELPS2) to increase gas supply infrastructure in the country. It also decade of Gas in 2020 to 2030, with specific projects targeted.
The managing director reaffirmed that success of these projects is, however, hanged on so many factors: Sanctity of existing contracts, predictable regulatory, commercial and legal framework across the country, and improved security and safety. These are all success enablers for these projects”, he stated.
“The effective utilization of available gas and building of a resilient domestic gas industry will require partnerships between the Nigerian government and oil and gas companies that can innovate, capacity to deliver major projects, and willingness to take on long term commitments.
For example, Okunbor noted that we know that there are several challenges that we need to overcome as a country in order to successfully build resilience and grow the domestic gas market.
“These include the need to accelerate gas sector development across seven thematic areas: unlocking the domestic gas-to-power value chain, accelerating infrastructure development plus virtual pipelines, driving gas based industrialization; deepening domestic LPG penetration building a stable regulatory environment anchored on a willing buyer and willing seller pricing regime; growing the export and regional gas market, and building local capacity/content for contractors and professionals in the gas sector.
He pointed out that these seven thematic areas are critical to realising the objectives of the ‘Decade Of Gas’ and they need to be pulled together in a Nigeria Decade Of Gas MasterPlan, NDGMP, that provides a roadmap that allows Nigerian to utilize its huge gas resources for its socio-economic development.
He cited that with Covid-19, we have seen a slowdown in the industry and in the ability to deliver projects not only due to the direct impacts of the virus on the local economy but because the shutdown of the global economy has affected the industry. According to him, this is due to the industry’s supply chain resilience on imports.
Post Covid-19, he urges all stakeholders that there is a need to work on building capacity in country to enable local industries enter the supply chain and participate more aggressively. We need to reduce the industry’s reliance on imports and create new markets in country”, he added.
At shell, the managing director said “we recognize that local content is key to sourcing a post-covid pandemic would and shell will continue to invest in this space. We remain committed to building capacity and competence in country to enable more Nigerians participate directly and indirectly in the gas value chain and pump more money into the local economy by supporting Nigerian Companies”, he stressed.
