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Nigeria’s new gas code to address pipeline infrastructure deficits, grow market

With the unveiling of the National Gas Transportation Network Code (NGTNC) by the Minister of State for Petroleum Resources, Timipre Sylva, on Monday, stakeholders in the sector are hopeful that the development will attract more investment into pipeline infrastructure in the country.

Predicated on the need to use the enormous gas deposits in Nigeria to grow the nation’s economy, the NGTNC applies between gas producers, shippers, and their agents.

Its provisions allow a window of six months for legacy agreements to migrate onto the network code while new and intending agreements are expected to align with the new code.

While Nigerian Gas Company (NGC) remained a sole operator providing pipeline infrastructure in the Nigerian gas market, the code according to the President of the Nigerian Gas Association (NGA), Audrey Joe-Ezigbo, will help Nigeria become a mature gas market.

“The code will attract more investors into pipeline infrastructure,” said Joe-Ezigbo

Commenting on the move, Assistant Director, Department of Petroleum Resources (DPR), Abel Nsa, explained that the network code is a set of rules and contractual framework between producers and transporters.

“It provides transparency and a level playing field for everyone who wants to come into the gas system. It is like a protocol to move gas within the system,” Nsa said.

Managing Director of the Nigerian Gas Company (NGC), Dr. Salihu Jamari, added that his company has been upgrading its facilities in expectation of the launching of the network code.

“We are making sure that metering is available at every point in the network. The Nigerian Gas Company is very much aware of its role in the implementation of the network code,” Jamari stated.

Nigeria’s huge gas reserves made people to describe the country as a gas province with a sprinkling of oil. According to data from the Nigerian National Petroleum Corporation (NNPC), the country has around 202 trillion cubic feet (TCF) of proven gas reserves plus about 600 TCF unproven gas reserves.

Meanwhile, the Group Managing Director of the NNPC, Mele Kyari, has stated that NNPC would work on the expansion of the Escravos-Lagos Pipeline System 2 (ELPS) and building the Ajaokuta-Kaduna-Kano pipeline as part of efforts to expand domestic gas utilization of gas for the benefit of the Nigerian economy.

Kyari stated that though the primary focus of the corporation was to ensure energy security for Nigeria, it had the capacity to meet the energy needs of the entire West African sub-region, adding that the corporation was working with its technical partners to restore its three refineries to be able to operate at optimal levels.

He said, already the Phase 1 of the rehabilitation work on the Port Harcourt Refinery had begun with Phase 2 work in the offing.

“We will continue to support the Dangote refinery and the other modular refinery projects in the country to guarantee energy security for Africa. Nigeria welcomes foreign investors to invest in the Oil and Gas Industry. 2020 is a year of gas. Nigeria will deepen domestic gas use and monetization of our huge gas resources,” Mallam Kyari said.

Kyari said Nigeria was ready and accessible for investments from all interested countries, individuals and partners, assuring that their investments were secured with high returns in the country.

Source: The Guardian