Energy
FG To Commission Nedogas 300 MMscfd Kwale Gas Gathering Facility
Nedogas Development Company Limited (NDCL), a Joint Venture company between Xenergi Limited and NCDMB Capacity Development Intervention Company, has in collaboration with the NNPC Gas Infrastructure Company (NGIC), a subsidiary of the Nigerian National Petroleum Company (NNPC) Limited, successfully completed the construction and technical commissioning of a 300 MMscfd Capacity Kwale Gas Gathering (KGG) and injection facility located in the Umusam Community, near Kwale in Delta State, Niger-Delta, Nigeria.
The formal commissioning ceremony of the facility will be performed by the Honorable Minister of State for Petroleum Resources (Gas), Rt. Honorable Ekperikpe Ekpo on June 6, 2024.
The Minister will be supported by the Governor of Delta State, Rt. Hon. Sheriff Francis Orohwedor Oborevwori and the Executive Secretary of the Nigerian Content Development and Monitoring Board (NCDMB), Engr. Felix Omatsola Ogbe.
The KGG Facility was designed to handle stranded gas resources in Nigeria’s OML56 oil province by providing the opportunity for independent operators in the area to monetize natural gas from their fields through the gas gathering, compression, injection and metering infrastructure of the KGG for quick access to market.
The KGG hub, which has been tied-in to the NGIC-owned and operated 48-inch OB-3 gas trunk line, is now fully commissioned with gas injection capacity totaling approximately 50 MMscfd comprising of 20 MMscfd from the Nedogas Plant located 3km away in Energia’s Ebendo field and another 30 MMscfd coming from the Matsogo field operated by Chorus Energy Limited. Injected gas volumes are gradually and steadily being ramped up.
This project represents a significant milestone in Nigeria’s decade of gas initiative as well as a major achievement in the quest to provide gas into the OB3 trunk line and monetize natural gas resources from the OML 56 producer cluster.
With the successful injection of gas from the Energia/Oando JV and the Chorus operated Ebendo and Matsogo fields respectively into the OB3, the KGG Facility is now poised to receive additional gas from nearby fields including those operated by First Hydrocarbon Nigeria (FHN), Pillar Oil, and Midwestern Oil & Gas, all aimed at positioning KGG as a fully-fledged gas-gathering facility and hub with single point injection of up to 300 MMscfd of gas into the OB3 via the KGG tie-in.
The plan is to expand the capacity of the KGG facility to 600 MMscfd in the second phase. In addition to the gas delivery obligations of the facility, the KGG will also be supplying the Delta State Economic Zone (DSEZ) from an integrated supply node within the manifold at the hub.
The NDCL is a 100% Nigerian company with a proven interest in innovating and deploying cleaner energy solutions for Nigeria’s growth and economic development.
The NCDMB’s equity investment in NDCL is one the strategic projects geared towards actualizing the Federal Government’s aspirations in key areas of the oil and gas industry.
Most of the NCDMB’s third-party investments are targeted at actualizing the Federal Government Decade of Gas programme. The investments are in line with the Board’s mandate to build capacity and catalyze local projects in the Nigerian oil and gas industry as enshrined under the Nigeran Oil and Gas Industry Content Development (NOGICD) Act.
Prior to now, NDCL’s precursor, Xenergi Limited, developed a novel approach to providing cleaner energy sources which resulted in the birth of Nigeria’s first inland Integrated Power, Propane and LPG Modular Plant in partnership with Energia-Oando JV, located in Ebendo in Delta State, Nigeria.
The Nedogas Natural Gas Fractionation Plant, produces high-quality LPG and propane and with the capacity to process over 25 MMSCFD of associated natural gas.
The capacity of the plant is currently being expanded to 60 MMSCFD.
The Executive Secretary NCDMB enthused that the success story of NEDOGAS at Kwale, Delta State could be replicated in other oil- and gas-producing communities to minimise gas flaring.
He declared the Board’s readiness to continue collaborating with the company. “Their model should be extended to other parts of the country where gas flaring is continuing. They have shown that with the modular system, we can quickly remove flaring from our operations in Nigeria.”
The Managing Director of NDCL, Mr. Debo Fagbami explained that with the completion of the first phase of the KGG Facility, the proof-of-concept to readily monetize gas has now been established to the extent of eradicating the pain of seeing an invaluable resource being wasted.
Rather than just being concerned about ending gas flaring – he sees opportunities to harness the potential of the flare sites from these oilfields which will ultimately convert a “wasting” resource into an economic asset used to generate cleaner energy.
With an estimated 180 billion cubic feet of proven Natural gas reserves, Nigeria has the ninth largest concentration in the world, but sadly enough, the country continues to flare significant quantities of Associated gas which has relegated the health and environmental well-being of Nigerians to the background for over 60 years.
Natural gas remains a relatively clean fossil fuel and represents a viable transition to renewable energy which plays a pivotal role in powering the growth of developing economies like Nigeria.
The KGG facility is set to create hundreds of direct and indirect jobs for indigenes of the host and nearby communities.
The Independent Petroleum Marketers Association of Nigeria (IPMAN) has projected a significant reduction in petrol prices once the Dangote Petroleum Refinery begins direct sales to oil marketers.
Speaking in an interview with Channels Television, IPMAN spokesperson Chinedu Ukadike said the association is in talks with the Dangote Refinery to secure direct lifting rights for Premium Motor Spirit (PMS), commonly known as petrol.
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This move comes after the federal government directed the refinery to sell exclusively to the Nigerian National Petroleum Company Limited (NNPC), with other marketers required to buy from the national oil firm.
He explained that bypassing middlemen by allowing marketers to source petrol directly from the refinery would cut unnecessary distribution costs, leading to lower prices at the pump for consumers.
Ukadike said, “We have written to Dangote, and he has responded positively, indicating readiness to discuss with us. We believe that these discussions will soon yield results, and whatever agreement we reach will be shared with Nigerians. We want to take our products directly to cut off all these unnecessary price hikes.”
Addressing public concerns about independent marketers being driven by profit, Ukadike reaffirmed IPMAN’s commitment to ensuring fair and affordable fuel prices for Nigerians.
He also expressed optimism that the collaboration with the Dangote Refinery, alongside the anticipated reopening of the Port Harcourt Refinery, would help resolve bureaucratic bottlenecks and stabilize petrol prices across the country.
The $550 million upstream gas project between the NNPC Ltd and TotalEnergies on the development of the Ubeta field has taken off, the Presidency announced on Tuesday.
This was contained in a statement in Abuja, on Wednesday, by the Chief Corporate Communications Officer, NNPC Ltd, Olufemi Soneye.
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According to Soneye, the Special Adviser to the President on Energy, Olu Verheijen, made the disclosure during an inaugural US-Nigeria Strategic Energy Dialogue, hosted by the U.S. State Department in Washington, DC.
“The signing ceremony of the 550 million USD Final Investment Decision (FID) on the Ubeta Field Development Project took place in Abuja in June, this year,” he stated.
The Ubeta field, which was discovered in 1964, is located northwest of Port Harcourt, Rivers State.
It was gathered that at a luncheon organised as part of the inaugural US-Nigeria Strategic Energy Dialogue, Verheijen revealed that the upstream gas project would deliver 350 million standard cubic feet of gas per day when operational.
Verheijen added that major energy reforms introduced by President Bola Ahmed Tinubu since June 2023 focused on improving energy security, attracting investments, and deepening collaboration with key partners, including the US government.
She said the key reforms had improved the viability of the gas-to-power value chain of the country.
The reforms, according to her, included initiatives to improve cash flows in electricity distribution through smart metering and the payment of outstanding debts owed investors and to reduce carbon emissions from gas production.
She added that the President issued five new executive orders to support the reform efforts, aimed at providing fiscal incentives for investment and reducing the cost and time of finalising and implementing contracts to develop and expand gas infrastructure.
The presidential aide said the directives are aimed to immediately unlock up to $2.5 billion in new oil and gas investments in the country.
Responding, the U.S. Assistant Secretary of the State Department’s Bureau of Energy Resources, Geoffrey Pyatt, said the dialogue was apt and strategic.
“The inaugural U.S.-Nigeria Strategic Energy Dialogue has set the stage for strengthened energy collaboration between the United States and Nigeria. Together, we’re advancing shared energy security, decarbonisation, and economic growth goals,” he said.
Minister of State for Petroleum Resources (Gas), Ekperikpe Ekpo, led the Nigerian delegation to the event.
Officials from the Ministry of Power, Nigerian Upstream Petroleum Regulatory Commission, Nigerian Midstream and Downstream Petroleum Regulatory Authority, Nigerian Content Development and Monitoring Board, and NNPC Limited were also in attendance.
The U.S. delegation included representatives from the Bureau of African Affairs, USAID, the U.S. Department of Energy, the U.S. Trade and Development Agency, and the Export-Import Bank.
Joe Ajaero, the President of the Nigeria Labour Congress (NLC), has criticized the Nigerian government for its role in the current pricing dispute between the Nigeria National Petroleum Corporation Limited (NNPCL) and the Dangote Refinery, attributing it to erratic government policies.
In a press briefing at Murtala Muhammed Airport Terminal Two on Wednesday, Ajaero condemned the situation as fraudulent and argued that a deregulated market should encourage competition and consumer choice, not impose restrictive pricing.
He asserted that the attempt to regulate Dangote’s pricing or influence private sector costs undermines fair market practices.
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Ajaero called on Nigerians to voice their concerns, claiming the government’s actions are undermining the private sector’s ability to set prices.
He said, “For a product produced here, he didn’t import with dollars, there was no landing cost, and they want him to sell it at the same cost as what they are bringing from abroad. That is fraudulent and unacceptable.”
Additionally, Ajaero criticized the government for not repairing the refineries as promised in August of the previous year, noting that no progress has been made as of September 2024.
On the subject of the N70,000 minimum wage, Ajaero assured that implementation is on track according to the agreement made on April 18, 2024.
He confirmed that the National Assembly has approved the bill, and the committee on consequential adjustments is actively working on its rollout.
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