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Energy

General Electric rehabilitates 3 gas turbines at NDPHC power plants

The project at NDPHC involved GE rehabilitating three 9E.03 gas turbines at NDPHC’s power plants in Sapele and Calabar.

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General Electric rehabilitates 3 gas turbines at NDPHC power plants

General Electric company has announced the successful completion of a gas turbine rehabilitation project at Niger Delta Power Holding Company’s (NDPHC) power plants located in Nigeria. Financial terms of the deal were kept under wraps.

This disclosure was made public by General Electric, in a notification sent to the NASDAQ Stock Exchange, which was seen by Nairametrics.

READ: GenCos to shut down over NBET’s administrative charge  

The project at NDPHC involved General Electric rehabilitating three 9E.03 gas turbines at NDPHC’s power plants in Sapele and Calabar, Nigeria. The company’s experts collaborated with the counterparts of its field services execution company, FieldCore, for stage three-bucket change-outs on three gas turbines, apart from additional combustion check-up.

Explore the Nairametrics Research Website for Economic Data

Backstory: In July 2018, The Niger Delta Power Holding Company (NDPHC), with the aim to facilitate greater use of its power plants by improving transmission and distribution infrastructure, signed a letter of intent with General Electric, for the provision of an end-to-end power intervention program.

It is worth noting that NDPHC is the major producer of electricity in Nigeria, with an overall installed capacity of 4.0-gigawatts. Currently, the company carries around 35% of the total generating capacity in the country.

READ: NDDC probe: House of Reps to sue Akpabio for perjury

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Why this matters

The completion of the project will help NDPHC in minimizing the unplanned downtime risk of these power plants; thus, boosting the efficiency and reliability of the facilities in producing electricity. This will help in securing and restoring the supply of up to 360MW of electricity, which is sufficient for supplying power to around 2 million houses.

However, the rehabilitation project is expected to help unlock the 2.5GW of additional generation capacity, to be sold to industrial and commercial hubs in the country.

READ: TCN, NNPC partner to boost gas availability, increase power supply

In the same regard, the successful rehabilitation of the power generation assets at Calabar and Sapele plants will help increase the 9E gas turbines’ efficiency, while lowering emissions and providing essential power for industrialization, healthcare facilities, homes, schools, and businesses.

GE has been collaborating with energy stakeholders to deploy innovative technologies tailored to respond to the needs in the region since the 1950s, with reliable baseload and flexible emergency power. In 2018, the company celebrated its 100th power plant in Sub-Saharan Africa; today, up to 17 GW of gas power generation on the grid runs on GE gas turbines.

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Omokolade Ajayi is a graduate of Economics, and a certificate holder of the CFA Institute’s Investment Foundation Program. He is a business analyst, and equity market researcher, with wealth of experience as a retail investor. He is a business owner and a stern advocate of Financial literacy, who believes in the huge economic prospect of the Nigerian Payment channels and Fintech space.

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Why the proposed Borno power plant may not materialise 

The glaring security challenge cannot be overlooked in considering a major power plant project in Borno State.

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Only a few days ago, the Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), Mele Kyari, led a delegation to Borno State to meet with the Governor of the State, Babagana Zulum.

In the conversation with Zulum, Kyari promised the establishment of a gas-fired power plant in Borno State within a maximum of 4 months to solve the recent blackouts that resulted from insurgents cutting off Borno from the national grid since January this year.

In Kyari’s words, “We have talked to each other and we think it’s very possible to establish a dedicated power plant in Maiduguri which will serve current needs of power supply not only in Maiduguri but to other parts of the neighbouring cities.”

Yet, there is a significant possibility that the power plant promised by Kyari may not materialize for many reasons, the first of which is security. In the meeting with Kyari, Governor Zulum had noted: “The ongoing insurgency has cut off the entire Borno from the national grid in the last three months. We put all our efforts and restored it back… but unfortunately, after 48 hours, the same group of insurgents went back and destroyed the main tower again.”

This glaring security challenge cannot be overlooked in considering a major power plant project in Borno State, particularly noting that the State and its surrounding communities have been the hot zone of insurgent and terrorist attacks by Boko Haram insurgents since 2009. Borno, Yobe and Adamawa have particularly been states where the insurgents have set up shop and carried out various activities, including kidnap, extermination of entire communities, burning of markets and religious buildings and the attack on the United Nations compound, in each case claiming tens or hundreds of innocent lives.

One report reveals that at least 37, 500 people have been killed by the insurgent group since May 2011, a modest number, some say. Also, till date, some of the secondary school girls kidnapped in the April 2014 Chibok incident are yet to be returned to their families. It is then bewildering how Kyari intends to see to the construction and operationalizing of this gas power plant.

Additionally, while the Minister of Petroleum for State, Chief Timipre Sylva, announced last year about the discovery of oil and gas deposits in the North, we have not seen any exploration and production kick-off. It then begs the question of where the gas for the Borno power plant intends to be sourced. The only gas pipeline that runs through the North – the AKK- is still in its first phase of construction out of three phases and has been earmarked at the earliest, to be completed in 2023 – not counting the typical delays the project will experience along the way.

Should the AKK by some stroke of luck materialize much earlier than the target date, the pipeline route is a considerable distance from Borno. It runs the route of Ajaokuta-Abuja-Katsina-Kano, its endpoint, a striking 481km from Borno State. Thus, there would have to be construction of a tie-in pipeline almost as long as the AKK from Kano to Borno State to get gas to Borno.

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Optimists may reference the oil and gas discovery in the North and how production may start soon, thus obliterating the need for a 481km pipeline. This optimism however is not well-founded, as insecurity has been shown to be a major risk to oil and gas projects everywhere in the world. One of the major reasons the Trans-Saharan Gas Pipeline proposed to run from Nigeria to Algeria was abandoned was due to security challenges posed by Nigeria’s Movement for the Emancipation of the Niger Delta (MEND), the Tuareg guerilla movement in Niger and other insurgent groups along the proposed route of the pipeline.

These increased the risks across board, including for completion and operations through the lifecycle of the project. As such, failing to fix the security threats in northeast Nigeria makes any proposed gas plant project a pipe dream. Transporting gas via LNG trucks is not a better option, given that the drivers and their cargoes would be in danger of being kidnapped, shot at or bombed. The risks for both personnel and investors are high.

In any event, promising a power plant in 4 months for the people of Borno is unconscionable, since a typical gas power plant will take between 1 to 6 years to construct in relatively peaceful regions. What the government needs to do instead of making promises it cannot keep is to work arduously to fix the security challenges in Northern Nigeria and at the same time consider using decentralised solar power to provide power supply to homes, government institutions, schools and businesses while plans to produce gas in the region or transport gas to it are underway.

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Business News

FG to open LPG distribution channels in all local governments

The project is targeted at reaching 99 million women and households within three years cutting across 774 LGAs in the federation.

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Nigeria's Natural Gas Liquids

The Federal Government disclosed that it is planning to launch Liquefied Petroleum Gas distribution channels in every local government in Nigeria.

This was disclosed by the Minister of State for Petroleum,  Timipre Sylva, at the inauguration of the Nigerian Women for Liquefied Petroleum Gas (LPG) Project, organised by the National Centre for Women Development (NCWD), Zigma Gas Limited and the Federal Ministry of Petroleum Resources on Friday in Abuja.

READ: LPG: Nigerians paid more to refill 12.5kg gas cylinders in January 2021

What the minister said

“The ministry is targeting to ameliorate the energy challenge in Nigeria and clean cooking gas is key in this regard because 70% of greenhouse emissions are caused by deforestation.

“This LPG project will enable us to empower rural women to use a more cleaner energy source for cooking.”

Mrs Mary Ekpere-Eta, DG NWCD added that the scheme would benefit Nigerian women and youths as it will support the efforts of the Federal Government in achieving its 2023 sustainable energy targets.

READ: World’s biggest oil company, Saudi Aramco pays a whopping $75 billion in dividend

“The project is targeted at reaching 99 million women and households within three years cutting across the 120,000 polling units and all wards in the 774 LGAs in the federation.

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“The first phase of this project will be targeting 11 states – Katsina, Sokoto, FCT, Ebonyi, Plateau, Adamawa, Borno, Bayelsa, Cross River, Imo and Ogun,’’ she said.

READ: NNPC expects $8.7 billion investments from refineries, pipeline rehabilitation

What you should know 

The FG has launched other policies aimed at maximising Nigeria’s internal gas usage, Nairametrics reported in February that the FG plans to convert one million cars to gas at no cost, in its autogas initiative.

 

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