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NNPC : “Nigeria cannot afford further delay on Escravos II pipeline project”

The recent fire incident reported on the Escravos-Lagos Pipeline (ELP), a natural gas pipeline which supplies gas from Escravos region of the Niger Delta area to Lagos, has shown the urgency of commencing work on the supporting route.

After several postponements, the Nigerian National Petroleum Corporation (NNPC) in October 2016 announced that the ongoing Escravos-Lagos Pipeline System 2 (ELPS 2) project would be completed by the last quarter of the year. Maikanti Baru, NNPC Group Managing Director, said during a courtesy visit to Ogun State Governor Ibikunle Amosun that issues surrounding the delay would soon be resolved.

The 36-inch, 342-kilometre gas pipeline project is expected to double the capacity of the existing ELPS, thereby improving gas supply to Ogun State and environs and guaranteeing a significant improvement in power supply across the country.

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Over one year after, however, the project is yet to be completed. Indeed, it appears the challenges persist, prominent among which are funding and lack of political will.

To underscore the importance of this project, the fire incident on the ELP on January 2, 2017 immediately led to shutdown of seven gas plants and the Trans-Forcados terminal. Many industrial gas users in hubs around Lagos went into crisis mode.

The affected plants include Egbin with electricity generation capacity of 1,320 megawatts (MW), 676MW Olorunsogo National Integrated Power Projects (NIPP) plant, 338MW Olorunsogo plant, 450MW Omotosho NIPP plant, 338MW Omotosho plant, and 60MW Paras power station.

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The Forcados Oil Pipeline System is the second-largest network in the Niger Delta and transports oil water and associated gas from fields in the western Delta to the Forcados oil terminal. The terminal has an oil export capacity of 400,000 barrels per day and a 31-kilometre pipeline which delivers crude to offshore loading berths for export.

As such, ELP is one of the most critical gas infrastructures in the country where 74 percent of electricity is generated by gas. The bulk of the power plants are located along the corridor, which is why the incident promptly led to the national grid failing twice.

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Nigeria is still unable to tap into its vast gas resources because it is still too distracted with crude oil, a resource fast going out of fashion. Oil majors, on the other hand, are shifting to gas because it is the next frontier of investments. Nigeria cannot afford to be left behind.

(BUSINESSDAY)

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