Nigeria Commissions Major LPG Plant to Increase Gas Utilisation

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Ameenah Hassan

Africa’s biggest economy, Nigeria, is a step closer to attaining its goal of thoroughly utilising its abundant gas reserves.

This comes as the president this week commissioned an Integrated Gas Handling Facility in Oredo, Edo State, built and operated by the Nigerian Petroleum Development Company (NPDC).

The new facility is the largest onshore Liquefied Petroleum Gas (LPG) plant in Nigeria and has the potential to supply about 20% of domestic demand for LPG.

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The NPDC, a subsidiary of state-run Nigerian National Petroleum Corporation (NNPC), and its associated Natural Gas Liquids depot would be delivering commercial-grade LPG, Propane, and condensate from the plant.

Scaling gas utilisation

“Scaling up utilisation of Nigeria’s abundant natural gas resources will help spur industrialisation,” President Muhammadu Buhari said, adding that 2020 was the country’s year of gas. He was speaking at the Council Chamber of the Presidential Villa on Tuesday.

Also Read: PIB: Osinbajo Says Nigeria’s Gas Fiscal Provisions Most Attractive in Africa

The Nigerian government has been taking steps to increase the production and broaden the use of gas within the country.

Nigeria has one of the largest gas reserves in the world and is a leading West Africa exporter – by the end of 2019, it had an estimated 200.4 trillion cubic feet (Tcf) of proven natural gas reserves, of which only 1.6 Tcf was produced.

That means the vast majority of its gas potential remained untapped and domestically, there is a prevalent use of liquid fuels to power transportation and much of industrial activity.

There is an ongoing drive to have car owners fuel their vehicles with gas in the place of premium motor spirit (petrol), as part of efforts to deepen the domestic gas market.

In October, the Department of Petroleum Resources issued a directive to 9,000 filling stations across the country for the installation of facilities for gas products. That is in line with the goal to improve the use of liquefied petroleum gas, compressed natural gas, liquefied natural gas, and autogas as alternative fuels for Nigerians.

“If you go to a filling station and you convert your car to dual capability or dual fuel, you will find gas LPG, you find CNG and LNG being sold,” minister of state for petroleum resources Timipre Sylva said at the time.

Some centres have already started the conversion, the Programme Manager, Nigerian Gas Flare Commercialisation Project, Justice Derefaka said last month. Some 50 conversion centres are earmarked to be upgraded and by January 2021, there will be conversion centres across the six geopolitical zones of the country.

Also Read: Autogas: FG in About Face, Says Vehicle Owners to Pay N250,000 for Conversion

Natural gas as an alternative comes with a cost advantage, which the minister was quick to point out. “So, if you look at the price of PMS versus the price of gas, it (gas) is going to be cheaper. Gas will even be cheaper than petrol as it is today,” Sylva said.

Deploying gas for transportation would also help reduce the demand for petrol and carbon emissions – CO2 from transport (percentage of total fuel combustion) in Nigeria was 35.4 as of 2014, compared to a world average of 20.4. Natural gas is known to have many qualities that make it an efficient, relatively clean-burning, and economical energy source.

Ameenah Hassan is an intern at Arbiterz.

Ameenah Hassan

Ameenah Hassan is a content writer with experience in public relations. She has contributed to Arbiterz since 2021, writing research-based news and features on business. She is currently pursuing a degree in Mass Communication at the University of Lagos.