The Nigerian National Petroleum Corporation (NNPC) has announced plans to boost power generation with additional 5,000 megawatts of electricity to the national power grid once the ongoing gas projects throughout the country are completed.
This follows progress being made on several gas projects, including the NLNG Train 7, with a foreign direct investment of between $3 billion and $5 billion.
According to a report from Thisday, this disclosure was made by the Group Managing Director of NNPC, Mallam Mele Kyari, while speaking at a virtual event organised by the Nigerian Gas Association (NGA), themed: “Powering Forward: Enabling Nigeria’s Industrialisation Via Gas,”
Kyari, who was represented by the Chief Operating Officer, Gas and Power, Mr Yusuf Usman, said the NNPC was committed to fulfilling President Muhammadu Buhari’s directive to boost domestic gas supply.
Other gas projects listed by the NNPC boss include the AKK, which he described as one the largest and most aggressive gas infrastructure that has ever been embarked upon in Nigeria, stretching 614 km from Ajaokuta, Abuja, Kaduna and Kano, and Lot B of the OB3 gas project, which is already producing 125 mmscfd of gas.
He said the NNPC hopes to establish 2 gas hubs, one at Oben and the other at Brass, adding that one of the presidential mandates is to deliver on gas and power and create a market in the domestic environment that will consume the planned 4.5bcf of gas.
Kyari pointed out that the state oil giant and its partners are able to raise about $260 million within Nigerian merchant banks and 2 African banks for the Asa North gas project.
What the Group Managing Director of NNPC is saying
Kyari in his statement said, “At the moment, the power sector is challenged and all efforts have to be put in to unlock the liquidity in the downstream sector and expand the transmission network. This will enable us to sell the gas we have already invested in and enhance the economic prosperity of the country.
“Within the NNPC, we are looking to establish about five gigawatts of additional power into the network. So, NNPC is engaging with the stakeholders to resolve the power sector issue so that investment that has been made in generating gas can be realised.”
He also stated that the NNPC had started creating a link between the domestic gas pipelines infrastructure and export gas pipelines to establish an outlet into the export route which will make the projects more bankable.
What this means
- The actualization of this plan by the NNPC will give a much-needed boost to the power sector which has been facing serious crisis despite the rapidly growing economy.
- Despite the power sector reform, which saw the Federal Government give up control of power generation and distribution but still retained transmission, the crisis in the sector still persists, with serious negative impacts on the agricultural, industrial and mining sectors. Even the Micro Small and Medium Enterprises are not saved from its crippling effects.
- The addition of 5,000 megawatts of electricity, which is about half of what the country generates at the moment, will go a long way to help reduce the crisis in the power sector and boost the economy, which is still very fragile.
FG reacts to reports of revoking 32 refinery licenses
The FG has denied revoking 32 refinery licenses that were issued to some private companies across the country.
The Federal Government has denied revoking 32 refinery licenses that were issued to some private companies across the country.
The reaction follows reports making the rounds in some section of the media that the government has revoked some refinery licenses that it had earlier issued within a period of 3 years.
This clarification is contained in a statement issued by the Head, Public Affairs of the Department of Petroleum Resources (DPR), on behalf of the agency on Tuesday, April 13, 2021, in Lagos.
The DPR said that the refinery licenses have validity periods for the investors to achieve certain milestones and would become inactive after its expiration until the company reapplies.
What DPR is saying
The DPR in its statement said, “We wish to clarify that DPR did not revoke any refinery licence. Refinery licenses, like our other regulatory instruments, have validity periods for investors to attain certain milestones.
This implies that after the validity period for the particular milestone, the licence becomes inactive until the company reapplies for revalidation to migrate to another milestone. This does not in any way translate to revocation of the licence of the company.”
The DPR, in line with the aspirations of the government, initiated the refinery revolution programme of the country to boost local refining capacity by enabling business and creating new opportunities for new investors with the granting of modular and conventional refinery licenses to investors.
He emphasized that the regulatory agency would continue to support investors in the oil and gas industry in Nigeria using its regulatory instruments such as licences, permits and approvals to stimulate the economy and align with the government’s job creation initiatives.
In case you missed it
Earlier on, some media reports suggested that the DPR had revoked refinery licenses that were issued to some companies for being inactive beyond the validity period. These refineries include modular refineries and conventional plants.
FG to extend fuel subsidy for 6 months
Reports indicate that the FG plans to spend N720 billion for the next 6 months on Premium Motor Spirit (PMS) subsidies.
The Nigerian Government may have suspended plans to end its subsidy payments as reports indicate that the FG plans to spend N720 billion for the next 6 months on Premium Motor Spirit (PMS) subsidies.
This was disclosed in an exclusive report by The Guardian on Sunday, citing that President Muhammadu Buhari ordered that the subsidies remain in place for the next 6 months.
“Specifically, President Buhari has asked the Nigeria National Petroleum Corporation (NNPC) to suspend any idea on subsidy removal for five to six months so that a plan that does not harm ordinary Nigerians is evolved if the deregulation must go on,” a Government official said.
What you should know
- NNPC GMD, Mele Kyari disclosed last month that the “NNPC may no longer be in a position to carry that burden because we cannot continue to carry it in our books,” after reports of fuel imports under-recovery revealed the FG was spending N120 billion a month on subsidy.
- Kyari also hinted that they may soon start selling PMS at market prices saying: “NNPC importing PMS at market price and selling at N162/L. The actual market price should be between N211 and N234/L. Meaning is that consumers are not paying the market price.
- “NNPC is currently the sole importer of PMS, and we’re trying to exit the underpriced sale of PMS. Eventual exit is inevitable, when it will happen I cannot say, but engagements are ongoing because the government is cognisant of the implications.”
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