We cover all the major happenings in the gas sector in the year 2021. From new regulations to major partnerships and projects, 2021 brought radical change to the gas sector pushing it forward and forcing a reassessment of the future of Nigeria’s energy landscape.
POLICY AND REGULATIONS
The Decade of Gas Launches
In March 2021, Nigeria officially launched the Decade of Gas, a designated timeline for increasing gas utilization and leveraging gas as a tool for driving industrialization and economic growth. The Decade of Gas was launched by President Muhammadu Buhari at the virtual Nigeria International Petroleum Summit (NIPS) 2021 Pre Summit Conference & the Official launch of the Decade of Gas.
The launch generated a lot of conversation in the sector and our Executive Secretary, Oga Adejo-Ogiri lent his voice to the conversation with an article on the need for a Master Plan to ensure the success of the Decade of Gas. We also organized a webinar to discuss how to unlock opportunities in the domestic gas market following the launch of the Decade of Gas.
The Petroleum Industry Act is Passed
After over two decades, the Petroleum Industry Act, a landmark legislation that is expected to herald fiscal, governance and regulatory reform in Nigeria’s oil and gas sector was signed into law by President Muhammadu Buhari in August 2021.
We covered the signing of the new law extensively. First, we highlighted key provisions that directly affected stakeholders in the gas sector Focusing on regulation, pricing, taxation, incentives, licensing and gas flaring. We also organized a webinar that brought experienced lawyers, government officials and gas sector executives together to discuss the implications of the Petroleum Industry Act for the sector
Can Nigeria’s Transport Sector Run On Gas?
The Petroleum Industry Act addressed the critical issue of petroleum subsidy by providing for the deregulation of all petroleum products. This generated a conversation on alternatives for a future where motorists and consumers will be impacted by fuel prices without the cushion of subsidy.
In response, we organized a webinar on the prospects of natural gas as an alternative to the use of petroleum and diesel in Nigeria’s transport sector.
PARTNERSHIPS AND PROJECTS
All the major industry partnerships and projects we covered in 2021.
Nigeria Makes Entry Into Methanol Production
Nigeria made its entry into the $20.6billion global methanol market signalling its intention to compete in the global methanol market with a major investment in its production.
With an estimated output of about 10, 000 metric tons of methanol upon conclusion, the project which is expected to cost $3.6billion will make Nigeria one of the largest producers of the product in the world.
Axxela Completes 18km gas pipeline in Ogun State, South-West, Nigeria
This landmark project was executed via Axxela’s subsidiary; Transit Gas Nigeria Limited in partnership with the Nigerian Gas Marketing Company, a subsidiary of the Nigerian National Petroleum Corporation.
The project delivers first gas to Rite Foods Limited, the manufacturer of Bigi Drinks, Rite, Bigi Sausages, and Fearless Energy Drinks.
Shell Nigeria Gas seals 20-year gas distribution deal
Shell Nigeria Gas (SNG) and the Nigerian Gas Marketing Company (NGMC) sealed a 20-year gas distribution deal to ensure that gas is delivered to industrial customers and manufacturing plants in Lagos and Ogun state
FG Commences Construction Work on 50MW Gas-Fired Power Plant in Maiduguri
The Federal Government, through the Nigerian National Petroleum Corporation (NNPC), commenced the construction of a 50 megawatts gas-fired power plant for the supply of electricity to Maiduguri and environs. Gas to be supplied in form of LNG by Greenville LNG.
Construction Commences for NLNG Train 7 Project
Construction commenced for the $10 billion NLNG Train7 project. The project is expected to increase LNG production capacity by 35% upon completion and create 12000 direct jobs.
UTM, Afreximbank Sign $5bn Financing MoU for Nigeria’s First Floating LNG
Nigeria’s marine and services group, UTM Offshore Limited, and the African Export-Import Bank (Afreximbank) signed a Memorandum of Understanding (MoU) to raise $5 billion for the development of Nigeria’s first floating liquefied natural gas (FLNG) project.
The project involves the development and financing of a 1.2 million tonnes per annum FLNG facility with a capacity to process 176 MMscfd of natural gas and condensate.
NLNG Strikes Deals For Domestic Delivery of LNG
Nigerian Liquified Natural Gas (NLNG) Limited expanded its domestic gas supply channel by signing deals with three companies for the delivery of 1.1 million tonnes per annum of Liquified Natural gas (LNG).
The executed Sales and Purchase Agreements (SPAs) will see Asiko Power Limited, Bridport Energy Limited and Gas Plus Synergy Limited utilize virtual gas supply models to improve gas supply to industrial and commercial users across the country.
BUA to Build New 70MW Gas Power Plant
Cement producer, BUA signed an agreement with Wartsila OY of Finland for the construction of a 70megawatts dual-fuel power plant for its BUA Cement Obu Line 3 project in Edo State, Southern Nigeria. This gas power plant will also be the third power plant to be commissioned by BUA from Wartsila.
NGMC and Axxela Joint Venture Sign Contract for Development of Ajaokuta Small-Scale LNG Project
Nigerian Gas Marketing Company and Axxela Joint Venture signed an Engineering, Procurement, Construction & Commissioning (EPCC) contract for the Ajaokuta small-scale LNG project.
Nigeria International Petroleum Summit
We were affiliate partners and exhibitors at the Nigeria International Petroleum Summit (now the Nigeria International Energy Summit). This was in furtherance of our mandate as an association to connect local players to investment opportunities and contribute to conversations around policy formulation
61st Power Dialogue
Our Executive Secretary, Oga Adejo-Ogiri was a panellist at the 61st Power Dialogue hosted by the Electricity Hub and sponsored by the MacArthur Foundation. The event was themed; “The Funding Conundrum: Financing Fossil Fuel Power Projects”. He spoke on the need for gas to be seen as a transition fuel to a net-zero future and for international financiers to understand this critical role of gas and fund gas projects accordingly.
2021 Gas Sector Stakeholders Forum in Kano.
We were ably represented by our Executive Secretary, Oga Adejo-Ogiri. at the 2021 Gas Sector Stakeholders Forum in Kano.
The Forum was an opportunity for stakeholders to share strategies targeted at optimizing the economic development of the Ajaokuta-Kaduna-Kano “AKK” Gas Pipeline Project. The AKK gas project remains key to the shared goal of enhancing domestic gas utilization and driving industrialization.