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‘Poor demand, inadequate infrastructure key gas dev. issues in Africa’
Whereas Africa is gradually waking up to the understanding that gas, rather than oil holds the next money to be made in non-renewable resources, major nations with massive reserves are beginning to identify major challenges holding back development in gas.
In Nigeria, the major issue remains gas flaring, but current efforts of the government driven by the Nigeria’s Gas Flare Commercialisation Programme (NDFCP) is likely to jump investments by mega local and foreign players.
In his recent paper delivered at the third edition of the Lawyers in Oil & gas Conference held in Lagos, the program Manager of NCFCP, Mr Justice Derefaka revealed that on fruition of the ongoing bidding process for the commercialisation of over 178 gas flare sites across Niger Delta, energy security in the country will be enhanced.
According to him, the expected new investments in the sub sector will among others, deepen demand for gas based solutions, create enabling technology, grow midstream players and increase environmental awareness.
Derefaka argued apart from the unprecedented job creation that will visit the successful completion of gas flare commercialisation, the age long gas flaring and associated impacts in oil producing communities will become a thing of the past.
In his lead argument, Nigeria is moving from the era of gas flare penalties to commercialising flare which makes better economic and sustainable sense.
From Nigeria to Ghana, the same wave of deepening gas driven economy is the campaign of the government but there are issues also hobbling the scheme.
According to the Manager in charge of Gas Business, Ghana National Petroleum Corporation (GNPC), Mr Hamis Usif, has said, in Ghana, the local gas market is relatively small, but has significant potential to transform the economy.
He noted that, the local gas market is relatively stable with demand driven mainly by power demand and growing at 7.3 billion cubic feet per year (Bcf/Yr); adding that lower gas utilization was as a result of lower demand and inadequate infrastructure for its transportation.
In his presentation at a recent Stakeholders Forum on Crude Oil and Natural Gas Marketing in Accra, Usif averred that “New gas infrastructure like the reverse flow and Karpower relocation is expected to increase gas demand by about 120 Million standard cubic feet per day (MMsfcd) of gas.”
Business Hilights Ghana Bureau chief reports that the gas Forum was put together by the Public Interest and Accountability Committee (PIAC) with the support of the GNPC, to educate and develop the capacity of industry stakeholders’ in Ghana.
Usif in his further insights, noted that whereas gas availability and new infrastructure should support increase in traded gas and industrial demand, the first priority use of natural gas (NG) in Ghana was to meet field operational requirements; stating that where contractor declares that a discovery was not commercial, GNPC might take over the discovery and develop the discovery if it had identified a market, through “sole risk”.
He said pricing for natural gas was influenced by the cost of development and the use to which the gas would be put.
On gas market development, Usif revealed that GNPC, as gas aggregator would aggressively pursue none power demand targets to switch from liquid fuels to gas by entities such as breweries, food industry, iron and aluminium industries.