Page 5 - AfrElec Week 26

AfrElec COMMENTARY AfrElec

AKK pipeline progress during the opening meeting of a new gas pricing
Nevertheless, it has not given up hope. On June committee that the government had to work to
30, Nigerian President Muhammadu Buhari support the AKK project. Specifically, he said,
attended an onlline ceremony marking the Abuja must develop a new domestic gas tar-
launch of a major domestic gas supply project – iff regime that is agreeable to gas producers, as
namely, the construction of the Ajaokuta-Kadu- well as industrial gas consumers and residential
na-Kano (AKK) gas pipeline. consumers.
When finished, this link will follow a 614-km “Without appropriate pricing, we can’t get it
route, running northward from the left bank of right,” Sylva was quoted as saying by The Sun.
the Niger River in Kogi State to the capital city of “We have to ensure that gas becomes affordable.
Kano State. It is meant to serve as the first section It is sad to note that we sell gas cheaply to inves-
of the Trans-Nigeria Gas Pipeline (TNGP) but tors while the price is high in the domestic mar-
will also deliver gas to domestic TPPs, thereby ket to the extent that some Nigerians say diesel is
making electricity more widely available. cheaper than gas.”
The pipeline will have a design capacity of The minister also told the gas pricing com-
3.5bn cubic feet per day (99.11mn cubic metres mittee that it would have 30 days to draw up and
per day, or about 36.175bn cubic metres per submit a report on gas pricing. The document
year), and initial throughput will amount to should include a review of domestic gas prices
2 bcf per day (56.64 mcm per day, or around and benchmarks and recommendations for pric-
20.67 bcm per year). As such, it will significantly ing methods that can accommodate all types of
increase the volume of gas available on Nigeria’s customers, along with evaluations and technical
domestic market. suggestions.
Yusuf Usman, the committee’s chairman,
Pricing issues responded by pledging to uphold all of Abuja’s
Timipre Sylva, Minister of State for Petroleum requirements. It remains to be seen, though,
Resources, took note of that last week, saying whether this deadline can be met.™

Week 26 02•July•2020 www. NEWSBASE .com P5