Gas Infrastructure and Supply
January 20, 2012
Dr. David Ige Group Executive Director, Gas & Power
Nigerian National Petroleum Corporation
Gas Strategy and Anchor Sectors
GAS TO POWER By 2014, we would have positioned Nigeria firmly as the undisputed regional hub for gas-based industries such as fertilizer, petrochemicals and methanol.
GAS BASED INDUSTRIALISATION HIGH VALUE EXPORT
STRATEGIC FRAMEWORK FOR NIGERIAN GAS
Consolidate Nigerias position and market share in high value export markets Targeted LNG export opportunities Regional gas pipelines that help
consolidate nations footprint and influence
Deliver on Presidents Gas Revolution Agenda to: Position Nigeria as the regional hub
for gas-based industries such as fertilizer, petrochemical and methanol
Transform gas sector to value adding sector
Significantly increase gas supply to the Power Sector
Focused delivery plan to support existing and ongoing power plants by PHCN and NIPP
Deliver Gas for at least 12GW by 2015
LNG Regional Pipelines
2
Gas Consumption and Demand Forecast
Based on the forecast growth in domestic gas demand, we foresee opportunities in transmission and marketing
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
1975
1976
1977
1978
1979
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
mm
scf
Year
Nigerias Historical and Projected Gas Demand
Power LDC GBI WAGP3
Gas Availability - Sources of Gas in Domestic Market
FGN Mandated Domestic Supply Obligations (DSO)
Direct Bilateral Arrangement between Suppliers and
Buyers Unutilized Gas Flares
Most significant short/medium term
planned source of gas
Allocation of available gas from
DSO sources managed by GACN
3 Sources of Gas in Nigeria
Gas from suppliers over and above their
respective DSO
Managed bilaterally on a willing buyer,
willing seller basis i.e. negotiated terms
Limited volume in the short term,
particularly from IOCs.
Small flared gas for which no plan exists
to utilize but 3rd party players may
propose utilization plans
4
Domestic Supply Obligation Western Area Supply Projects
3
4
2
1
1 Dry Gas 2 Existing Wet Gas 3 Ongoing Projects - Wet Gas 4 FID Acceleration - Wet Gas
5
5 Gas from East 5
Domestic Supply Obligation Eastern Area Supply Projects
6
Analysis of Stranded Gas in the East
A significant amount of gas is stranded currently in the East mainly due to infrastructure and the delays in NIPP power plants
7
Koko Port
Bonny LNG
Escravos
Ob/Ob
Oben
Utorogu
Egbin
Olorunshogo Omotosho
Ihovbor
Geregu
Afam
Delta IV
Abuja
Kaduna
Calabar
Map showing critical Infrastructures
8
Sapele
Western Network Pipeline System
ELPS A Escravos to Warri expansion
from 300mmcf/d to 600mmcf/d Will allow immediate addition
of 80mmcf/d from Escravos Due end 2011
Looping ELPS C Doubling capacity to 2bcf/d from
Warri to lagos Due August 2012 Pipes expected in October
Olorunshogo Permanent Line 24permanent line to Olorunshogo. Recent contract approval by Mr. P and
contractor being mobilized. Due Apr 2012
Will address pressure problem at Olorunsogo
9
QIT
Bonny NLNG
Uquo
Alscon
Ibom Power
Calabar NIPP
Unicem Cement
Imo River
Obigbo
Alaoji NIPP
Aba Industries
Notore
Indorama
Obiafu/Obrikom
Obite Ubeta
Rumuji
Alakiri GTS 1
Cawthorne Channel
Escravos
Oben
Geregu NIPP
Ajaokuta
ELPS 1
ELPS 2
Egbin
Olorunshogo
Omotosho
Koko Gas Industrial Park
Ibadan
Jebba
OUR
Oso
Existing Gas Source
Existing Pipeline System
Ongoing/Planned Pipeline system
Legend
Power Plant
Industries
Ongoing Pipeline Projects ELPS Phase 1
11
Horizontal Directional Drilling Operation across Warri Benin Express way
Lowering of welded line pipes at NGC Right of Way through Jesse, Delta State
Welding activities for Ethiope River Crossing
Ongoing Pipeline Projects Alaoji, Olorunshogo
12
Pipe stacked on Site
Offloading pipe on site
ROW Clearing
Roadmap to Securing Alternative Funding for Pipelines
Assess Pipeline Tariff Review Tariff Affordability Review revenue
securitisation Source for Investors
Secure Financial Closure
Assessment of pipeline tariff required to make 3rd party financing viable this study now completed by NNPC
Engagement of stakeholders (e.g. NERC) on affordability of tariff and implication for medium-term MYTO
Checking of possible tariff revenue securitisation to make 3rd party financing bankable
Road show to attract investors / financiers, selection of willing financiers/investors
Investors secure financial closure
Description
Sept 2011 Dec 2012 Jun 2012 Jan 2012 Dec 2011
13
Gas to Power Supply Outlook
14
New Gas Sources of Gas to Bridge Gap New sources of gas, hitherto not considered for domestic market e.g. bringing offshore PSC gas to shore, are being evaluated. This could add 400-500 mmscf/d by 2016/17
Koko
1
2
Erha Bosi - Development of offshore processing plant with offshore pipeline to transport about 400mmscfd of gas currently being re-injected to the western CPF in Koko.
CAMAC Oyo Field Development Following options are being looked to monetized the currently re-injected 100-200mmscfd gas in Oyo field :
a. Offshore pipeline from Oyo to the western CPF in Koko
b. Offshore pipeline to ELPS via Chevron Okan gas processing plant
c. Offshore pipeline to OGGS
1
2
15
Conclusion
We have an enabling policy framework is in place to support critical mass of gas supply development for the power sector
Very good progress being made in development of a robust gas grid that will enable rapid growth of supply from diverse sources increasing the liquidity of supply
Medium term outlook is promising and power sector investors can be assured of supply
16
APPENDIX
17
Changing Power Demand
18
Overview of the Nigerian Gas Industry Gas Resource Base
1,680
1,046
899
265 263 245 199 187 176 159
-
200
400
600
800
1,000
1,200
1,400
1,600
1,800
Trill
ion
cubi
c fe
et
Proven Natural Gas Reserves, 2010
Source: EU Energy Portal; Transparency International, 2011 Report on Oil and Gas Companies
Nigeria has a huge economic potential trapped in this vast natural gas resource
600TCF Undiscovered Potential
19
Enabling Sector Policy Stimulating Supply
To support the agenda, a set of enabling policies were approved by His Excellency, Dr. Goodluck Jonathan. These are being rolled out and have created a major boost and jumpstart for the sectors agenda
Scalable Gas Infrastructure
Blueprint
20
Strategy Aggregator Company: Gas Aggregation Company Nigeria (GACN)
Gas Aggregation Company Nigeria (GACN) Contact Details: Office: #1B Malcolm Fraser
Street, Asokoro, Abuja Telephone: 098759045
Email: [email protected]
GACN was established to manage the Domestic Supply Obligations Facilitate gas access and aggregation of gas pricing
21
Status of Major Infrastructure Projects
22
Eastern Network Pipeline System Completion of the NOPL pipeline in 2012 will unlock stranded gas from MPN (100mmcf/d); NAOC Ebocha (50mmcf/d) and TEPNG (60mmcf/d), bringing them to Obigbo Node hub from where Alaoji and other Eastern Power plants can be supplied
23
Eastern Network Pipeline System
24
Our efforts in Power are focused on meeting a projected 3.5 bcf/d of gas demand by over 30 existing and proposed power plants.
Gas to Power
PHCN 818 mmscfd
1
NIPP 1,297 mmscfd
2
JV IPP 322 mmscfd
3
3rd Party IPP 531 mmscfd
4
Egbin + AES Delta IV Sapele Olorunshogo Omotosho
Geregu Afam I-V
Olorunshogo Sapele Geregu Omotosho Ihovbor
Egbema Gbaran Omoku Alaoji Calabar
Chevron Agura NAOC, Okpai Total, Obite Shell, Afam VI ExxonMobil, QIT
0
500
1000
1500
2000
2500
3000
3500
Q4 2011 2012 2013 2014 2015
mm
scfd
Power Sector Gas Demand PHCN NIPP JV IPP 3rd Party IPP
Numerous 3rd party IPP in consultation with the Bulk Trader
25
26
Was created to manage Domestic Gas Supply obligations volumes
First point of contact for Gas Buyers to access gas for domestic market use
Primary aim Coordinate and manage wholesale gas supply from Gas Producers to eligible Gas
Purchasers within Nigeria
Ensuring a balanced growth of all critical sectors of the economy: Power, Gas Based
Industries and Local Distribution Companies
Conduct due diligence assessment on eligible Gas Buyers
Allocate available gas from the DSO to credible buyers successful on assessment
Facilitate the expeditious execution of the GSAA and GTA between the buyer, seller
and transporter respectively
Operational since Jan 2010
Role of GACN in Domestic Gas Market
27
Due Diligence General Process
28
Map showing critical Infrastructures
28
Critical Pipeline Projects
29
Gas Infrastructure and SupplyGas Strategy and Anchor SectorsGas Consumption and Demand ForecastGas Availability- Sources of Gas in Domestic MarketDomestic Supply Obligation Western Area Supply ProjectsDomestic Supply Obligation Eastern Area Supply ProjectsAnalysis of Stranded Gas in the EastSlide Number 8Western Network Pipeline SystemSlide Number 10Ongoing Pipeline Projects ELPS Phase 1Ongoing Pipeline Projects Alaoji, OlorunshogoRoadmap to Securing Alternative Funding for PipelinesGas to Power Supply OutlookNew Gas Sources of Gas to Bridge GapConclusionSlide Number 17Changing Power DemandOverview of the Nigerian Gas IndustryGas Resource BaseEnabling Sector Policy Stimulating SupplyStrategy Aggregator Company:Gas Aggregation Company Nigeria (GACN)Status of Major Infrastructure ProjectsEastern Network Pipeline SystemEastern Network Pipeline SystemGas to PowerRole of GACN in Domestic Gas Market Slide Number 27Slide Number 28Critical Pipeline Projects
Top Related