Business

Maximizing natural gas use: Prospects, constraints

Nigeria is one of the top 10 nations in the world with huge natural gas reserves. Nigeria’s estimated proved plus potential reserves stood at 184 trillion cubic feet (tcf) as at 2007.
This is made up of 95 tcf of associated gas and 89 tcf of non-associated gas. The combined total of proved, probable and possible reserves is estimated at 300 tcf.
Unfortunately, there have been no significant gas exploration activities and the modest developments in gas reserves are largely connected to oil exploration (i.e. associated gas).
As at 2006, estimated daily gas production was 4.6 billion cubic feet per day (bcfd), and nearly 55% (about 2.5 bcfd) was flared. The balance 45% was channeled towards gas reinjection into producing oil wells, domestic usage and as feedstock for the Nigerian Liquefied Natural Gas (NLNG) project.
Gas Policy & the Gas Master Plan Gas development in Nigeria has been constrained by the absence of clear fiscal terms; gas pricing mechanism; legal and regulatory framework; and inadequate financing. Consequently, government introduced a natural gas policy and a gas master plan.
The natural gas policies was targeted at promoting a public  private sector partnership for an orderly and speedy commercialization of the nation’s gas reserves, and so contribute to the development and diversification of the domestic economy.
Similarly, the gas master plans was developed as a framework for maximizing the value inherent in the nation’s gas reserves, and thus ensure the multiplier effect of gas usage in the economy and enhance the high value gas export market.
The gas master plan has three main components: the national domestic gas supply; pricing policy and regulations; and the gas infrastructure blueprint. The domestic gas supply obligation is meant to deal with the issue of improvements in domestic gas supply by imposing supply obligations on petroleum upstream operators.
 

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