The Minister of Petroleum Diezani Alison-Madueke has announced some emergency plans to address the problem of gas supply to power plants across the nation which has being responsible for the fall in power supply.
Speaking to journalists in Abuja on Tuesday, the Minister said the short-term interventions would result in almost 90 per cent of the outstanding shortfall to power being addressed over the next 12 months.
According to the Minister, “since 2005, when the National Integrated Power Projects (NIPP), were kicked off, there had been no alignment between the planned NIPP and the necessary gas supply to power them.”
These projects, she noted are all in very advanced stages and should be completed within the timeframe of 12 months, as she claimed that appropriate steps are being taken by authorities in power sector to address all outstanding debts and commit to payment for future gas supply as well as other terms stipulated in the Gas Supply Agreements (GSA).
She explained that the problem with the gas supply is accentuated in the western part of the country when compared to the east, where she claimed there is an excess of gas.She blamed this on the non-alignment of the NIPP projects and the gas supply to power them.
“Today, the challenge of gas supply is essentially localised around the western axis, as we currently have a situation of excess gas availability in the Eastern axis. As we speak, there is over 300mmcf/d (equivalent of about 1000 megawatts) worth of gas available in the Eastern axis but currently not utilised.”
“This is due mainly to the aforementioned misalignment and also the underperformance of existing PHCN power plants.”
“As we develop the East-West pipeline, we will be able to leverage this gas in the West” she stated.
The minister said in total, 800mmcf/d of gas was being produced in the western axis of which 520mmcf/ is deployed to the power sector (an equivalent of about 1800MW on average). The balance is supplied to domestic manufacturing industries such as the cement plants, etc, and the West African Gas Pipeline project.
“In total, over the next 12 months, we will be adding 500mmcf/d (equivalent to 2000MW) to the grid. This will have a direct major impact on the overall power situation in the country” she said.
She further explained that about 700MW of power will be added to the nation’s power crid by June.
“Specifically, about 180mmcf/d (about 700MW) of this additional 500mmcf/d is due within a few weeks, by June 2012. This will come from Escravos, Utorogu, Ughelli and Oredo. Ongoing activities such as laying of the Olorunsogo pipeline, the completion of the ELPS A pipeline and the completion of the NIPP pipeline around Oredo are key elements of this addition.”
According to her, these projects are all in very advanced stages and should be completed within the timeframe, adding that with the addition, the identified shortfall in supply to Sapele, Geregu and Olorunsogo power plants will be addressed.
She also noted that, “beyond the immediate timeframe, the balance of about 320mmcf/d (about 1300MW) will be delivered through the next 12 months” adding that “new power plants are continually coming on stream, therefore, in addition to the 180mmcf/d, a further 320mmcf/d will be delivered and deployed to these plants over the next 12 months.”
Mrs Alison-Madueke stated that to achieve the 320mmcf/d, a few critical projects will be deployed by the intervention team, including leveraging the excess processing capacity in PanOcean to process gas that will be re-routed from Oredo by NPDC, as well as accessing additional gas at Escravos and major expansion of the Utorogu hub.
“These are the projects that will collectively add 320mmcf/d (1300MW) over the 12-month period.” “I am confident that the steps we are taking will have a visible impact on gas sustainability and supply, and therefore will positively impact on the power aspiration of the nation,” she noted.
The Minister further stressed that the government had directed the deployment of a pragmatic contracting strategy to enable expedited procurement of critical items such as the line pipes and related accessories.
“These interventions will require additional funding which is being sourced through government’s public-private funding initiative, she added.
