Page 5 - DMEA Week 43 2021

DMEA COMMENTARY DMEA

permits from the Department of Petroleum connectivity to the north of the country, Kyari
Resources (DPR) - now replaced by the the Nige- anticipates that demand will grow significantly
rian Downstream and Midstream Petroleum – from around 4.8bn cubic feet (136mn cubic
Regulatory Authority (NPRA) - are intended to metres) per day in 2020 to 10-23bcf (283-
increase active refining capacity to 1.55mn bpd. 651mcm) per day by 2030.
However, as the consultancy points out: He said that current demand is broken down
“achieving the full 1.5mn bpd of capacity into: 8bcf (227mcm) per day for power, 0.77bcf
required to cover domestic fuel demand in full (22mcm) to industry and 3.2bcf (91mcm) per
is reliant on the completion of 20 more facilities, day exported via the West Africa Gas Pipeline
which, given the current state of the industry, is (WAGP) with around 54bcf (1.5bn cubic metres)
quite a stretch of the imagination”. flared.
The NNPC has a dire track record for refin- Significant gas demand will stem from new
ery operation, but will take a back seat going fertiliser projects including those by Dangote
forward, though its recent mandate to acquire a at Lekki and NNPC’s Brass facility in Bayelsa
stake in any private refinery constructed with a – around 5bcf (142mcm) per day, increasing
capacity of 50,000 bpd or more suggests that the power capacity in line with the Presidential
company is keen to make up for past failings to Power Initiative – up from 1.4 bcf (40mcm), and
direct the growth of the downstream sector. improving connectivity with industrial facilities
He noted that there are also plans to co-lo- in the north of the country – 1.2bcf (34mcm).
cate 215,000 bpd worth of capacity at the Port On the topic of connectivity, Kyari high-
Harcourt Refining Co. (PHRC) and Warri Refin- lighted the Obiafu-Obrikom to Oben (OB3) and
ing and Petrochemical Co. (WRPC) while there Ajaokuta, Kaduna, Kano (AKK) pipelines.
are plans to upgrade the Waltersmith facility to “The OB3 project, which brings gas from East
50,000 bpd. to West, is nearing completion. The 614km AKK
Kyari expressed hopes that a further 250,000 project, which was launched by the President in
bpd could be added in the form of condensate June 2020, is progressing very well. These could
refineries with private investors to be attracted add up to $40bn to annual GDP and create addi-
by “positive returns”. tional six million jobs,” he said.
“About $3.097bn investment opportu- The Nigerian government has previously
nities exist in condensate refineries while declared 2021-2030 the decade of gas and
$1.6bn-$2.7bn is required by NNPC to improve the country certainly has significant scope to
the supply and distribution petroleum of prod- improve on its poor record for gas utilisation.
ucts, revamp LPG infrastructure and build However, given the twin push to monetise
[compressed natural gas (CNG)] plants.” gas and to overhaul Nigeria’s refining sector, a
more accurate representation would have been
Gas demand to declare it the decade of improved self-reliance,
Meanwhile, as Nigeria seeks to increase gas though admittedly, it’s not a very catchy name.™

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