AKK Gas Pipeline: Economic Potentials Endless – Prof Bugaje
Professor Idris Muhammad Bugaje is the Rector of the famous Kaduna Polytechnic, with wealth of experience in Petrochemical value chain. A product of Ahmadu Bello University with post-graduate degrees from local and international institutions, Prof Bugaje had a short stint during his NYSC at Warri Refinery. He has been teaching chemical engineering all his life, and was instrumental to many breakthrough researches in the field of chemical engineering. In this no-holds-barred interview with SAIDU ABUBAKAR, the former Director General of the National Research Institute for Chemical Technology (NARICT), Zaria laid bare, his excitement over the recently launched Ajaokuta-Kaduna-Kano (AKK) pipeline project by President Muhammadu Buhari, a project he said stands out as a mark of the beginning of a new era aimed at the reindustrialization of the densely populated region of the most populous black nation. Prof. Bugaje maintained that the project, when completed, will not only make cooking gas cheaper and affordable but will also boost agriculture through the provision of Urea fertilizer. He also allayed fears of continued banditry in the North because right from the pipeline laying project to the commencement of gas production, a lot of employment opportunities will abound to curtail social vices.
Excerpts:
Recently President Muhammadu Buhari launched the Ajaokuta-Kaduna-Kano (AKK) pipeline project, affirming government’s commitment to ensure timely delivery of the landmark project within budgetary allocation and specifications. How do you see the realization of that?
Actually, President Buhari has really turned around the course of history of the economy of the North by bringing this project. It was long overdue. Gas pipelines have been in the south for several decades. We have even taken pipelines to as far as Ghana, crossing Benin Republic and Togo, thereby leaving the Northern part of this country without gas. And gas is the basic stepping stone of industrialisation in this new century. So we thank Mr. President for this effort and look forward to more pipelines, because the other pipeline that goes from the South East across to Biu, Gombe, Bauchi, Kano should also be taken up as soon as possible so that the entire zones of the country will be fully covered, because the North East is not covered at the moment.
Enumerating the benefits of the project, billed to be completed in two years, the President said it will provide gas for generation of power and for gas-based industries which would facilitate the development of new industries …Does that appetize the hope of industrialization of the country?
Really, we used to be an industrial zone in the northern part of the country but unfortunately in the last 40 years or so majority of the factories, about 80 per cent have been closed down. Some of them moved to Lagos and Ogun States improving the local economy of those states to the extent that Ambode (former Governor of Lagos), before leaving office, declared Lagos as the fifth largest economy in Africa, displacing Angola which used to be the fifth. Nigeria, South Africa, Egypt and one other country then Angola. Lagos which used to be the cluster of industries in Africa was declared fifth because Lagos alone consume (up till now) about 60 per cent of the total electricity generated in the country because of the cluster of industries. Lagos can survive for three, four years without taking anything from the federation allocation. Bola Tinubu (former Governor of Lagos) tested it during the Obasanjo administration. He ran the state for two years without collecting a kobo from the federation allocation. So this scenario should tell our northern governors that we must industrialize. It’s the way out to develop our people and to banish poverty. We therefore need to mobilise our governors to realise that industrialization is the way out, to bring revenue to the government and improve the economy, and to bring development to the people and gas is the key. There is no raw material in this world as important as natural gas. It is even more important than crude oil because with gas you can produce hundreds of products. I hope this will open a channel for industrialization but my emphasis will be more on Petrochemical than power and I have reasons for that.
Will the project bring succour to moribund industries along transit towns in Kogi, Abuja (FCT), Niger, Kaduna, and Kano States when completed and operational?
Surely, it will, because in Kaduna, the hub of textiles industries in the years past, used to employ about 10,000 textiles workers, so it is going to bring some smiles when these industries are resuscitated. They still need energy, they need process feet in terms of low pressure steam, or even hot water for some processes. The consumption of what they call heavy oil contributed to the collapse of the industries. I think it was almost about N140 per litre in those days. So exhorbitant but now they can use natural gas, very clean source of energy, cheaper than oil which burns with very good blue flame and you can put it on a low pressure steam to run your textiles. You can even generate electricity if you want to do it with gas. All you need to do is to bring the gas into the top cylinder of your engine without any carburetion and you don’t need nozzles to spray it into droplets, directly into the combustion engine and it will burn and generate electricity. So those who have 500KVA or one megawat electricity generating set, it may not be very economical but still cheaper than using diesel. So there are a lot of opportunities. But besides that I look at the downstream activities that will follow but surely, the older industries, the textile mills and so many other tanneries in Kano will all be revived because of the availability of cheap and clean energy.
Aside significant job creation potential, in what other ways will Nigerians benefit from the AKK when completed?
Well, if AKK is completed and if we seize on the opportunity because we have to seize on the opportunities to establish industries like the Petrochemical plants, if we are able to achieve that we can be able to have thousands of employments being generated, I will even say tens of thousands in the sense that the pipeline is going to deliver about 3.5mcf per day. So 3.5 x 360 days with give you one trillion cubit feet of natural gas per annum, that is a very massive amount of energy. So the kind of industries that it will support and the employment it will generate is very vast. And our young University and Polytechnic graduates that have no jobs will have an opportunity to have employments, then the larger communities will also have economic benefits through the sale and distribution of end products, and even the agricultural sector will benefit very immensely.
There seems to be resilience on the part of the Petroleum Ministry, NNPC and relevant stakeholders to deliver on the project despite the COVID-19 pandemic, don’t you see the raging banditry in the North as a likely setback?
Well, the gas pipelines are actually the solution to the banditry. If you go deep down, what is the cause of the banditry in the North. Bad governance, poor governance, to endemic poverty, unemployment in the North. So the gas pipeline is meant to reverse all these.
On downstream investment: With the project likely to take two years to complete, how will Nigerian and foreign investors come in, will cooking gas be cheaper and more affordable to Nigerians?
Like I mentioned earlier, the project is going to have an impact on the availability of LPG. The natural gas coming from the South is wet, containing some higher carbon chain gasses which can be condensed easily and converted Into LPG cooking bottles and distributed. This can happen in Ajaokuta before taken to Kano. This is therefore going to affect the supply chain positively by making gas available. Prices will crash because at the moment we collect our gas from Port Harcourt and Warri. When they crash it will allow rural areas to afford gas for cooking, and that will reduce desertification. Therefore this is another very important impact of the project on the environment.
Specifically, will the project have any significant impact on Ajaokuta Steel Company?
One of the major challenges of Ajaokuta is power supply. So the AKK should now have captive power. In other words, power generated purposely for the Ajaokuta Complex without having to lean on the general national grid. So the AKK will really have that impact.
What will be the multiplier effect of the project on Agriculture …are we likely to see any surge in agricultural activity in the North?
The greatest benefactor of this AKK will be agriculture if we utilise it very well because natural gas is the most affordable raw material to produce Urea Fertilizer. At the moment Urea Fertilizer is very much in scarcity here in the North, the food basket of the nation. So if we can get the investors to invest very well in Urea Fertilizer, we are going to produce massively to satisfy our markets and even improve on the consumption because at the moment Nigeria consumes between 10 and 15 kilograms per hectre, per annum which is very low compared to the world average of 140 kilograms per hectre per annum. Countries like Bangladesh that carry out two farming seasons per year, consume about 200 kilograms per hectare. Our consumption is one of the lowest in the world, therefore the AKK if we utilise it very well, will boost agricultural produce, especially rice and maize, and this is going to have positive impact on the rural economies as well as the GDP of the nation. So there is going to be a very positive impact.
What will be your advise to state governments, industrialists, businessmen, etc on this project?
The role of states is basically to facilitate investments that will utilise natural gas from the AKK pipeline. Therefore I’m calling on the Northern state governors, especially the AKK-states (five of them and the FCT), to convene a round-table meeting where all the stakeholders will be there for the states to tell us what incentives they are going to provide. For example, free land, tax holiday and so on, and the investors will raise issues they want to raise, and they all will agree and also draw up a roadmap so that will the two years of the completion of the AKK pipeline project, we can see some of these Petrochemical plants running. As I emphasized I prefer we use this gas for petrochemicals because this will be a higher value addition to power generation. Our power generation is overstretched in terms of national grid carrying capacity. Therefore, we must give more attention to the production of Urea and other petrochemicals.
