Non-evacuation of electricity causing shut-in of gas producer wells—NNPC decries
Fresh reason has emerged as to why on a daily basis, over 500 million standard cubic feet of gas were being shut in by producers in the industry.
The Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), Dr Maikanti Baru, made the revelation in his keynote address at the just concluded Nigerian Gas Association’s (NGA) 11th International Conference and Exhibition in Abuja, saying the rising inability of electricity generation companies (Gencos) to evacuate produced power is causing heavy losses in gas production.
According to him, “It is important to point out that due to the problems in the power sector, particularly transmission and distribution, the industry is forced to shut in over 500mmscfd of gas meant for the power sector that would have generated about 2,000 megawatts of electricity”.
Baru was quick to disclose that the challenges had necessitated discussions for electricity grid upgrade and captive power generation, among others.
However, the Corporation was sure that the challenge will ease sooner as the new regulation and penalty on gas flaring would lead to a reduction in the volume of flared gas in Nigeria.
In his further submission, Baru averred that “There are issues around power transmission and evacuation. Non-evacuation of power has led to back pressure on the transmission lines, which has also resulted in shut-in of producer wells. Thus, it is a cyclical challenge.
“This challenge will definitely dovetail into discussions around national grid upgrade, grid decentralisation, off-grid power and captive power, among a host of alternatives.”
On the state of demand for gas in the country, NNPC boss revealed that “Today, we have an unprecedented demand for gas, which far outweighs the global average growth rate. This growth is mostly fuelled by demand from the power sector following massive investment in power plants (National Integrated Power Projects) and relocation of gas-based industries to Nigeria.
“Our current average gas production is in the region of 8.5Bscfd. Of this volume, about 43 per cent or 3.7Bscfd is exported; 32 per cent or 2.7Bscfd is utilised for gas re-injection/gas-lift; 18 per cent or 1.5Bscfd is used domestically for power and industries; while the balance of seven per cent or 0.6Bscfd is unfortunately being flared,” Baru disclosed.
