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Nigeria’s Gas Export Remains High Amid Domestic Shortage

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  • Nigeria’s Gas Export Remains High Amid Domestic Shortage

As the country continues to suffer gas shortage for power plants and household cooking, industry stakeholders have raised concerns about the continued export of over 70 per cent of commercialised natural gas.

The nation’s natural gas is exported mostly through the Nigeria LNG plant, West African Gas Pipeline, Escravos Gas-To-Liquids plant.

Last year, following the resurgence of militant attacks on oil and gas facilities in the Niger Delta, the supply of gas to the domestic market fell by 19.2 per cent to 307.2 billion cubic feet, according to the latest data from the Nigerian National Petroleum Corporation.

But the volume of gas exported, only fell by 8.1 per cent to 1.14 trillion cubic feet, and was about 79 per cent of the nation’s gas that was commercialised last year.

In March, a total of 101.07 Bcf of gas was exported while 34.38 Bcf was supplied to the nation’s power sector, industries and households.

Only about 59.87 per cent of the total gas produced that month was commercialised while the balance of 40.13 per cent was either re-injected, used as upstream fuel gas or flared.

Nigeria has the world’s ninth largest proven gas reserves at 187Tcf, but many of its power plants lack adequate gas supply and cooking gas consumption in the country is one of the lowest in the world.

The Chief Executive officer, GasInvest Limited, Mr. David Ige, said, “Currently, the domestic gas market is experiencing severe shortages, which is forecast to last a few more years into the future. This creates a major energy security challenge for the nation.”

He said a disproportionate focus on the LNG export might lead to a situation similar to what “we have in crude oil today where we remain a major exporter of crude oil and suffer shortages of products, which are then imported.”

According to the former Group Executive Director, Gas and Power, Nigerian National Petroleum Corporation, Nigeria exports about 3500 million cubic feet per day of gas in LNG and utilises less than 2000mmcf/d domestically.

Ige said, “The shortage in the domestic market is about 1000mmcf/d relative to known demand from power sector and industries. This gap between domestic demand and supply is forecast to grow to 2000mmcf/d within the next four or five years.

“If the imbalance between export LNG and domestic utilisation is not addressed, we create a gas sector that is export-oriented and a domestic market that suffers huge energy crisis.”

He suggested that focus should be in addressing the imbalance between domestic and export and in ensuring that “whatever export commitment is made does not in any way compromise the long-run energy security of the country.

According to him, no amount of revenues from export will mitigate the impact of the Gross Domestic Product loss arising from lack of adequate gas supply for electricity and industries.

In April, Australia, one of the world’s biggest liquefied natural gas exporters, said it would introduce export control restrictions to tackle an acute domestic gas shortage that was pushing up prices and threatening electricity supply and industries.

Under a new “gas security mechanism” due to enter into force on July 1, the government will be able to restrict exports when it believes there is not a secure supply of gas available to domestic users.

“In the long run, Nigeria is better off using its gas as a source of energy for its economy rather than as a source of income from international gas sales,” the President, Nigerian Association of Energy Economics, Prof. Wumi Iledare, said.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Economy

India, Spain, the Netherlands, USA, Nigeria’s Major Export Markets -NBS

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India, Spain and the Netherland top Nigeria’s export markets in the final quarter of 2020, according to the latest data from the National Bureau of Statistics (NBS).

The Commodity Price Indices and Terms of Trade Q4 2020 report showed that the United States and China trailed the three.

However, the NBS revealed Nigeria exports mainly crude oil and natural gas during the period under review.

It, “The major export and import market of Nigeria in Q4 2020 were India, Spain, the Netherlands, United States and China.

“The major export to these countries were crude petroleum and natural gas. The major imports from the countries were motor spirits, used vehicles, motorcycles and antibiotics.”

The bureau stated that the all-commodity group import index increased by 0.13 per cent between October and December 2020.

This was driven mainly by an increase in the prices of base metals and articles of base metals (one per cent), boilers, machinery and appliances; parts thereof (1.03 per cent), and products of the chemical and allied industries (0.75 per cent),” it stated.

The NBS, however, noted that the index was negatively affected by animal and vegetable fats and oils and other cleavage products.

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Economy

Onyeama: Qatar To Invest $5bn In Nigeria’s Economy

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The oil-rich state of Qatar is to invest a total of $5 billion in Nigeria’s economy, the Foreign Affairs Minister, Godfrey Onyeama, has disclosed.

Onyeama, who spoke Sunday at a send forth dinner in honour of Nigeria’s Ambassador-designate to the State of Qatar, who is also the outgoing Director of Protocol (DOP) at the State House, Ambassador Yakubu Ahmed, also stated that recent career ambassadorial appointments made by the gederal government was based on merit, experience and professionalism.

The minister further said there had been discussions with Qatar on partnership with Nigeria’s Sovereign Wealth Fund (SWF), for significant investments in the region of $5 billion in the Nigerian economy.

According to him, ‘‘Qatar is a weighty and strategic country and very strategic in that part of the world and we are putting our best feet forward to advance the interest of our country economically and in other areas.”

He recalled that President Muhammadu Buhari had visited the State of Qatar in 2016 and the Emir of Qatar, Tamim Bin Hammad Al-Thani, reciprocated with a State visit in 2019.

Onyeama also explained that only trusted hands with a track record of diligence, experience and professionalism in the Foreign Service were recently appointed career ambassadors by the federal government.

The minister said the appointment of Ahmed and other career ambassadors were predicated on posting dedicated and keen Foreign Service practitioners to serve as image makers of the country.

He said: ‘‘Ambassador Yakubu Ahmed is a dedicated professional with a penchant for rigour and detail. He is very capable and one of the best in the Ministry of Foreign Affairs. He is personable, affable, extremely friendly, dispassionate and objective.

‘‘He is going to head a very important mission, a very important country, reckoned to be one of the richest countries in the world, per capita, and there’s a lot we will be doing with the State of Qatar.”

Also speaking, the Deputy Chief of Staff, Adeola Rahman Ipaye, described the honoree as a ‘‘perfect gentleman, very even-natured and always well turned out’’.

Ipaye said he had no doubt that the newly appointed ambassador would serve the country well in Qatar, adding that: ‘‘We are further encouraged that when he completes this assignment, he would return to serve Nigeria in a higher capacity.’’

In his remarks, the Permanent Secretary, State House, Tijjani Umar, while congratulating the outgoing DOP on his appointment, lauded Ahmed for excellent service to the State House and the nation.

‘‘He served this institution and the nation with the deepest sense of responsibility and it is very important that we establish a tradition where the system appreciates those who have served it well and those who will continue to serve it well,’’ he said.

Umar urged the new envoy to keep very fond memories of his time at the Presidential Villa, assuring him of the prayers and goodwill of all the staff.

Responding, Ahmed thanked President Buhari for the great honour and privilege of making him his principal representative in Doha, Qatar.

The Ambassador-designate pledged to deplore his energy and skill to the promotion of the existing cordial relationship between Nigeria and Qatar, particularly in the areas of economic, political, cultural and consular affairs as well as other key areas.

Ahmed, who joined Nigeria’s Foreign Service in 1993, said during his years in public service he had learnt that ‘‘patriotism, selfless service, diligence, determination and perseverance will always result in the achievement of the desired objective’’.

According to him, these virtues would be his ‘‘watchword’’ in the pursuit of Nigeria’s foreign policy objectives and the attainment of national interests.

The Ambassador-designate singled out for appreciation the Chief of Staff to the President, Prof. Ibrahim Gambari, and the state Chief of Protocol, Ambassador Lawal Kazaure, saying he had learnt a lot working under their mentorship.

He expressed gratitude to the Minister of Foreign Affairs and the Permanent Secretary, State House for giving him the opportunity of a memorable work experience in the State House.

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Economy

France, Nigeria to Build New Partnership

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France is currently aiming at building a new partnership with Nigeria, with the dispatching of its Minister in charge of Foreign Trade and Attractiveness, Franck Riester, to Nigeria.

Riester, who was expected at the time of filing this report on Monday, is scheduled to visit Nigeria from 12-14 April, 2021.

A statement from the French Embassy in Nigeria said: “Franck Riester is visiting Nigeria from 12 to 14 April, a visit that follows up on the priorities set by French President Emmanuel Macron during his official visit to Nigeria in July 2018 and his desire to build a new partnership between Africa and France.

“As the largest economy in Africa and the economic engine of West Africa, Nigeria is indeed a major partner for France, the first in sub-Saharan Africa with bilateral trade amounting to a total of 4.5 billion USD in 2019 (2.3 billion USD in 2020, due to the Covid-19 pandemic).”

It disclosed that the minister will have several official meetings in Abuja and Lagos, in order to underline the importance of the bilateral economic relationship and to prepare the summit on the financing of African economies in Paris on 18 May.

It revealed that the objective of the mission is also to further strengthen the links between the French and Nigerian private sectors, and “in this regard, the minister will have in-depth discussions with the main Nigerian economic actors to strengthen bilateral cooperation and investments, both in Nigeria and in France, particularly in the logistics sector”.

It said while in the country, the minister would meet with young Nigerian entrepreneurs in the cultural and creative industries sector, to discuss the major role of their country in African creativity and the development of the African entrepreneurial ecosystem, with the support of France.

It further said: “The minister will also open the ‘Choose Africa’ conference, a €3.5 billion initiative by President Emmanuel Macron dedicated to supporting the development of start-ups and SMEs in Africa to enable the continent to benefit fully from the opportunities of the digital revolution.”

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