Page 7 - AfrOil Week 44 2019
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AfrOil POLICY AfrOil
According to the report, authorities in Abuja ought to take action to make larger volumes of gas available for domestic consumption. “Nige- ria’s gas resources [have] the potential to catalyse industrial growth and development, in addition to [their] role as a key revenue earner [for] the government,”itsaid.
The department’s report came to light shortly after the Nigerian Gas Association (NGA) released a statement asking the govern- ment to promote and support efforts to increase domestic gas consumption. “Natural gas is that one singular resource Nigeria can leverage to create transformative change across various sectors and spheres of industry,” said Audrey Joe-Ezigbo, NGA’s national president.
Performance
Shortly afterwards, Dr Godswill Ihetu, the for- mer CEO of Nigeria LNG, told The Nation that local producers had actually been delivering less gas to TPPs this year.
As of the end of June, he said, the volume of locallyproducedgasflowingtoNigerianpower stations stood at 751.17mn cubic feet (21.27 mcm) per day. This is down by 1.35% on the figure posted on the same date in 2018, he said.
Ihetu speculated that conditions could improve in the future. Three of the biggest oil companies working in Nigeria – Royal Dutch Shell, ExxonMobil and Chevron – are all look- ing into proposals for expanding the use of gas in Nigeria’s industrial sector, he said.
PROJECTS & COMPANIES
Dangote refinery to launch in 2021
NIGERIA
THE 650,000 barrel per day refinery (bpd) being built by Nigeria’s Dangote Group at Lekki near Lagos is scheduled to be commissioned in early 2021 and reach full capacity midway through the year.
Speaking to Bloomberg at a conference in Lagos, Dangote Industries executive director Devakumar Edwin said that the refinery would meet Nigerian demand for gasoline, with small volumes of surplus being exported. Diesel and Jet A-1 fuel are to be sent to international markets.
“We are confident that we can meet 100% of the requirement of the country, so the balance willgoforexport,”Edwinsaid.
The facility is key to Nigerian efforts to improve its downstream sector, and has long been hoped to transform the country from a fuels importer to a net exporter.
Edwin said in the summer that the refinery would not reach mechanical completion until the end of 2020, with output ramping up there- after. The latest delays came about because of issues with the nearby Port of Apapa, through which equipment for the facility was being transported.
Reuters quoted Edwin as saying that the refinery would depend on roads and sea ports for bringing its products to market despite ear- lier reports that a dedicated pipeline would be built. Speaking at the OTL (Oil Trading and Logistics) Expo, he said that fuel would be trans- ported in “shuttle” boats to Nigerian cities Warri and Calabar, with other products being trucked.
With the surrounding infrastructure in varying states of disrepair, Dangote is repair- ing and expanding one road, while the state government is building a toll road to facilitate deliveries. Edwin said: “That’s going to reduce a lot of congestion.”
The Dangote facility cannot come online quickly enough for Abuja. Data released in
May by the Nigerian National Petroleum Corp. (NNPC) showed that the country’s four state- owned refineries were operating at just 5.55% of their nameplate capacity.
The NNPC’s four facilities have a com- bined nameplate capacity of 445,000 bpd; the Kaduna facility can produce 110,000 bpd, Warri 125,000 bpd and the two Port Harcourt units, built roughly 25 years apart, have a joint total of 210,000 bpd.
However, the latest figures show that 5.55% was a six-month high. “The lower operational performance recorded is attributed to the ongoing revamping of the refineries, which is expectedtofurtherenhancecapacityutilisation when completed,” NNPC said.
After years of under-investment, the age- ing facilities typically run at less than 10% of capacity and a general update on operations by NNPC in January this year disclosed that full turnaround maintenance (TAM) at the plants had not been carried out for 42 years.
This has meant that imports are relied upon to meet more than 80% of demand and NNPC added that a refining capacity of 1.52mn bpd would be required to meet Nigerian demand by 2025.
The Dangote refinery will have a capacity of 650,000 bpd (Photo: This Day)
Week 44 06•November•2019 w w w . N E W S B A S E . c o m P7
