Nigeria to spend $1bn on 1000km gas pipeline

*Oil reserve now 37 billion barrels

22 May 2012, Sweetcrude, Abuja - As part of efforts to transform the country into the industrial hub of Africa, the Federal Government has revealed that about $1bn will be spent on gas infrastructure projects that will impact positively on the power and industrial sectors of the economy.

The Minister of Petroleum Resources, Mrs. Diezani Alison-Madueke disclosed this during the Ministerial Platform to commemorate the one year in office of President Goodluck Jonathan in Abuja.

Mrs. Alison-Madueke noted that the present administration in the spirit and letter of the transformation agenda has embarked on the most aggressive expansion of the domestic gas infrastructure in 30 years creating a platform to transport over 2billion cubic feet of gas per day within the next 24 months.

According to her, 136km x 36inch permanent gas pipeline from Oben to Geregu has been completed, creating a major sharp artery to the Geregu Independent Power Plants, Dangote’s Obajana cement and other potential industrial customers, adding that this line will provide arterial supply to the North once the Ajaokuta-Kano line is completed.

She added that two other critical pipelines that will be concluded shortly include the Itoki-Olorunshogo 31km x 24inch gas pipeline and 104km x 24inch Escravos-Warri gas pipeline expansion.

The Minister said by the time the two pipelines are completed in the next few months, a permanent solution to the challenge of gas supply to the PHCN and NIPP power plants at Olorunshogo as well as supply to Ewekoro, Abeokuta and environs for industrial capacity growth would have been achieved, adding that this will also double the existing transmission capacity to 600 mmcf/d and immediately add about 80mmcf/d additional gas supply to the grid from Escravos.

Mrs. Alison-Madueke disclosed that three other major gas pipeline projects that are on-going and progressing steadily are the doubling of capacity to 2bcf/d of ELPS from Oben-Ore-Lagos, through the 320km x 36inch pipeline construction, NNPC/Total JV pipeline from Ubefan to Imo River via Obigbo, saying that the administration recently awarded the 120km x 48inch Ob/Ob-Oben East West gas pipeline contract.

“Specifically in the time frame, we have invested close to $1bn in almost 1000km of gas pipeline development,’’ the Minister noted.

She informed that the NNPC/Total JV Usan Floating Production and Storage System (FPSO), the fifth in the Nigeria deep offshore region was recently commissioned and is currently producing 103,000 barrels per day.

The Minister noted that the Federal Government has continued to invest in increasing the country’s oil reserve to meet its target of 40 billion barrels of oil and crude oil productivity of 4 million barrels per day.

“The aspiration is to grow crude oil reserve to 40billion barrels. Collectively these projects have added about 1.5billion barrels bringing the national reserve to 37 billion barrels,’’ the Minister noted.

Going forward, Mrs. Alison-Madueke noted that the Federal Government’s effort at encouraging indigenous participation in the Oil and Gas industry is aggressively yielding positive results with the establishment of an oil terminalling facility (the Ebok terminal) with current daily crude oil production of 7,000 barrels per day and a plateau production of 50,000bpd at full capacity.

She added that 1000 barrels per day crude oil topping plant to produce diesel have also been completed and commissioned by an indigenous oil company.

Speaking on the transparency and accountability principle of the present administration, Mrs Alison-Madueke said the Petroleum Ministry has set up four Special Task Forces headed by eminent Nigerians to address critical issues in the sector.

On the current state of the refineries, the Minister asserted that the rehabilitation of the three refineries are being pursued vigorously saying that a major feat was achieved early this year when the fluid catalytic cracking unit, FCCU, of Kaduna Refining and Petrochemical Company, KRPC, was repaired locally and restarted after almost ten years of dormancy hence adding about three million litres to in-country production of premium motor spirit.