The Nigerian Gas Association (NGA) hosted the second edition of its Industry Multilogues, rendered through its 12th biennial International Conference & Awards platforms, recently.
NGA is the apex organisation representing the varied and numerous stakeholders in the gas sector within the Nigerian oil and gas industry. Association is the largest gas-focused volunteer/individual-member organization; the umbrella association and voice of the gas industry in Nigeria.
In a statement endorsed by ED Ubong President, Nigerian Gas Association (NGA) saying As the first edition of the Multilogues, the 2-day event hosted virtually in conformance with COVID-19 protocols, featured over 300 participants across the continents of Asia, Europe, Africa, North and South America, and 35 local and international speakers comprising the Governor of Lagos State, Mr. Babajide Sanwo-Olu; Nigeria’s Minister of State for Petroleum Resources, Chief Timipre Sylva; President of International Gas Union (IGU), Dr Joe Kang; the GMD of NNPC, Mallam Mele Kyari; and the Executive Secretary of NCDMB, Engr Simbi Wabote. Others include the Country Chair of Shell Companies in Nigeria, Mr. Osagie Okunbor; the MD of NLNG, Mr. Tony Attah; the MD of Seplat Petroleum Development Company, Mr. Roger Brown; the MD of Shell Nigeria Gas, Mr. Ed Ubong, and erstwhile President of the NGA, Mrs. Audrey Joe-Ezigbo, amongst other numerous international and local players in the upstream, midstream, and downstream gas value chain.
After a robust presentation, engaging deliberations, and very insightful discourse, the panelists and speakers came to the following conclusions:
- Nigeria has enough gas resources to meet its demands in the domestic and export market.
- All stakeholders must work with the Government to deliver Nigeria gas ambitions over the next decade.
- Nigeria must enhance the fiscal and operational policies required to attract the right investments to realise the objectives and aspirations outlined within the nation’s Gas programmes.
- The government is enjoined to urgently resolve legacy debts, payment guarantees, and other commercial impediments, including power delivery bottlenecks in the Gas-to-Power programme.
- The Panelists called for the adjustment of royalties on Gas supplied and consumed in the domestic environment to encourage more supplies that catalyse more significant development in the overall domestic economy.
- They demanded non-discriminatory pricing mechanisms that offer suppliers equal opportunity for returns on investments and cost-reflective tariff structure across the Gas value chain.
- There was consensus that the Gas supply industry must be anchored on a willing-seller willing-buyer framework to unlock further investments in Gas exploration and delivery infrastructure.
- There should be a removal of price controls and concessional Gas tariffs for sections of the market that are critical to achieving overall economic growth objectives.
- The scope of the National Gas Transportation Network Code’s should be expanded to fully cover the domestic Gas market in line with provisions already specified by the Department of Petroleum Resources (DPR), which regulates the industry.
- The Central Bank of Nigeria (CBN) and other development banks need to prioritise the Gas industry, underpinned by concessional interest rates and guarantees for dollar-denominated transactions, to assure lender confidence in Gas projects.
- PENCOM to make the $32 billion pension funds available to Natural Gas investors as priority funding for critical Gas infrastructure, to bolster economic diversification and sustained industrialisation in the country.
- The panelists agreed that cost-reflective pricing mechanism, favourable fiscal regime, ease of repatriation of dividend/capital, stable exchange rate, and national industrial policy stability are critical conditions for spurring equity and loan financing in the local Gas market.
- It was revealed during the sessions that the BOI has a $500 billion funding arrangement with the Bank of China (BOC) to finance import equipment for flare Gas capture, which requires the intending borrowers to advance about 25 per cent of their funding needs and import their equipment from China.
- Similar arrangements with the US Exim Bank are also available for players that want to import their flare capture equipment from the United States.
- The panels enjoined players to foster good corporate governance, de-risking loans with equity contributions and mapping out clear funding outlines before initiating a project.
- The panel agreed that Gas based industries such as fertiliser and cement constitute key consumption centres that could grow the country’s domestic Gas consumption and unlock the much-needed economic growth required to take over 90 per cent of Nigerians out of extreme poverty.
- There is a need to warehouse world-class local capacity to adapt imported technologies for the local conditions to reduce overdependence on Original Equipment Manufacturers (OEMs), improve local content know-how, deepen innovations, curtail maintenance costs and the overall cost of production.
- The conference highlighted the need to create and develop regional infrastructure across the West African economies to deliver Gas supplies to markets through various marine, rail, road, and pipeline channels.
- They also called for improved regional collaboration on maritime security to arrest the Gulf of Guinea’s rising piracy incidents for safer virtual Gas shipping through marine transport.
- The process of building industry capacity and retooling professionals from an oil-based economy to a gas-based economy should begin in earnest with the NGA playing a central role.