Given the interdependence of the gas and power sectors of the economy, there is a need for a coordinated approach to policy formulation and implementation by both sectors to achieve the government’s objective of improving energy security and reducing energy poverty, Minister of Power, Adebayo Adelabu, has said.
Nigeria will need substantial additional gas, generation, transmission and distribution infrastructure to meet electricity demands,
The Minister was speaking at the 2nd Domestic Gas and Gas Infrastructure Summit 2023 held in Abuja on Tuesday.
Adelabu noted that the importance of gas in the Nigerian economy cannot be overemphasized as gas was a potent source of electricity generation to sustain the much-needed power for national development.
He said the the electricity generation companies depend on the supply of natural gas to operate, as such the country would require more gas supply to guarantee adequate generation and supply of electricity in the country.
“With increasing population growth, Nigeria will need substantial additional gas, generation, transmission and distribution infrastructure to meet its electricity demands and it is believed that the much-needed capacity in generation will come from gas to power and renewable energy,” Mr Adelabu said.
Presently, he said the on-grid energy mix in Nigeria was dominated by thermal (80 percent) and hydro (20 percent) power-generating sources.
“Addressing climate change alongside achieving sustainable development objectives is core to the approach to power sector investments. Natural gas has a role as the energy transition fuel for rapid economic growth and industrialization.
“It has several characteristics to play in supporting net zero transitions over the coming decades in Nigeria,” Adelabu said.
The National Renewable Energy and Energy Efficiency Policy in which Nigeria set the vision 30:30:30, he said, was aimed at achieving 30GW of electricity by 2030, with renewable energy contributing 30 percent of the energy mix.
“The plan is that hydroelectricity (both large and small hydro) will contribute 28 per cent and 19 per cent respectively to the nation’s electricity generation mix by 2030,” he added.
The president Abuja Chamber of Commerce and Industry (ACCI), Al-Mujtaba Abubakar, said natural gas has replaced coal as the fuel of choice for electricity production.
He said globally, natural gas has replaced coal as the fuel of choice for electricity production, with climate and air quality benefits.
“The rapid decrease in the cost of solar, wind and other renewable energy technologies makes these an even better alternative. Gas has a special role in the energy transition as a backup to a renewable-based power system because gas boilers can be turned on almost instantly while starting up a coal-fired power plant takes much longer,” Abubakar said.
He said research has shown that Nigeria currently accounts for 33 percent of the total gas reserves in Africa.
“With a reserve base of 36.97 billion barrels of oil and 208.83 trillion cubic feet of gas, representing 33 percent of Africa’s total gas reserves of 620 TCF, Nigeria can be described as a gas-rich nation ranking number one in Africa in reserves, with a life index of 94 years.
“The rising global demand for cleaner energy sources has offered Nigeria an opportunity to exploit gas resources for the good of the country. This is an opportunity to buy in for the development of our dear nation.
“For us at the Chamber of Commerce, we take advantage of whatever would benefit the business community, improve economic growth, drive investments, and provide much-needed jobs for Nigerians.
“We are glad that this present administration pledged her unalloyed commitment to leveraging the domestic utilization, processing and international export of Nigeria’s massive gas resources as a transition fuel to catalyze the fundamental restructuring of the nation’s economy for expansive growth during this tenure,” he said.
Abubakar explained that this annual event was organised by the Energy Trade Group of the Abuja Chamber of Commerce and Industry (ACCI) with a focus on promoting local content, fostering a friendly business environment through government liaisons, and organising seminars and workshops, to ensure that the benefits of the oil and gas industry in Nigeria extended throughout the nation.
The conference is a platform to discuss the future of the Nigerian gas industry.