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Gas economy: FG declares taxes waiver, others for companies involved in gas pipeline construction — Minister

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By Matthew Denis

The Minister of State for Petroleum Resources (Gas), Ekperikpe Ekpo has disclosed that the Federal Government has outlined special incentives to boost gas production in large quantities to meet the demands of Nigerians.

The Minister in a speech at the 8th edition of the Sub Saharan Africa International Petroleum Exhibition and Conference held in Lagos said the incentives includes include 3-year tax waivers for Companies that build and operate gas pipelines, and could be extended to five years at the satisfaction of the Ministry of Petroleum Resources, and recently Mr. President approved the zero duty and VAT for imported CNG and LNG. This is in addition to the existing tax waivers on imported Gas equipment.

He noted that all these are geared towards deepening gas penetration in Nigeria.

He said, “This event is significant for the energy sector especially at a period when energy transition and security is at the top of our minds. Let me start by expressing my deepest appreciation to the organizers of this conference for continuously promoting ideas and collaboration among African oil and gas players.

“In Nigeria, gas is not just a transition fuel but it is strategic to achieving a more secured energy future and as a catalyst for other national development goals.”

According to him, the Ministry of Petroleum Resources has identified finance and Investment in infrasructure as critical to the deelopment of the Gas sector.

“As part of the tools to addrss this problem, the Midstrem and Downstream Gas nfrastructure Fund was put in place to enable the Governmnt make equity investent in Gas Infrastructure.

“As e gather to harness ideas o develop our energy sector, let us not forget the variou incentives put in place by te Government to encouage the Gas Sector development.

“These include 3-year tax waivers for Companies that build and operate gas pipelines, and could be extended to 5 years at the satisfaction of the Ministry of Petroleum Resources.”

He revealed Mr. President approved the zero duty and VAT for imported CNG and LNG. This is in addition to the existing tax waivers on imported Gas equipment. All these are geared towards deepening gas penetration in Nigeria.

“The responsibility of developing our energy resources does not depend on the Government alone. It calls for collaboration, knowledge sharing, and commitment on the part of the private sector industry players too as the Government makes the right policies and creates the enabling environment for businesses to thrive.

“As we anticipate the kick-start of critical infrastructure such as the AKK, and the expansion of the Lagos-Escravos pipeline to Morocco and further to Europe, we call for collaboration to support existing Government initiatives. There is a huge demand for Gas in Nigeria, and the sector is large enough to accommodate everyone.”

He stressed that the Ministry of Petroleum Resources welcomes ideas and ventures that could help bridge the gap existing between demand for gas and the low level of development of our enormous natural gas reserves.

“I hereby reiterate the readiness of the Government and the Ministry of Petroleum Resources, in particular, to foster fruitful collaborations and partnerships that will aid achievement of the national goals for domestic gas utilization and export.”

Energy

Nigeria’s Adekeye emerges Chairperson, APPO Training Directors

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Nigeria’s Folashade Adekeye has emerged as the Chairperson, Forum of the Directors of Oil & Gas Training & Vocational Education Institutes of the African Petroleum Producers Organization (APPO).

Adekeye, who is the Director, NNPC Academy, took over from the former chairperson, Mr. Abdelkader Guenone, the Managing Director of the Algerian Petroleum Institute (API), during the second meeting of the Forum, in Abuja, at the weekend.

Adekeye, who heads the NNPC’s oil and gas training arm, brings into the role over 30 years of experience, and is expected to work with her colleagues from APPO Member Countries in order to foster more collaboration towards addressing the challenges of competences, skill gaps, infrastructure, and poor funding in the organization’s training institutions.

Earlier in his keynote address at the opening ceremony of the meeting, the Group Chief Executive Officer of NNPC Ltd., Mele Kyari, represented by Inuwa Danladi, Executive Vice President (Business Services), emphasized the importance of a standardized educational and training approach to meet the changing demands of the oil and gas industry.

Also in his keynote address, APPO’s Secretary General, Dr. Omar Farouk Ibrahim, charged the Member Countries to work towards further enhancing collaborative efforts to establish Oil & Gas Centres of Excellence across the African continent.

Dr. Ibrahim, also from Nigeria, said having good knowledge of the Forum’s challenges would enable APPO Member Countries to make recommendations and provide solutions in areas such as Oil & Gas project funding, technology adoption, and the formation of Africa Energy Bank.

He concluded that such collaboration by all member countries will guarantee Africa’s energy accessibility, affordability and sustainability, which overall, will strengthen her economies and bring prosperity to its citizens.

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FG may fund installation of CNG pumps as marketers lament high cost

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The Federal Government may consider assisting independent fuel marketers with funding to install Compressed Natural Gas sales pumps at filling stations across the country, newsmen has learnt.

This followed the lamentation of the Independent Petroleum Marketers Association of Nigeria that its members were unable to finance the installation of CNG sales pumps at their filling stations in line with the presidential directive promoting the CNG initiative.

The marketers said the cost of installing CNG pumps was prohibitive for its members, adding that the high-interest rate charged by banks also made borrowing money for the project an unattractive option.

President Tinubu had announced an end to the fuel subsidy era during his inauguration on May 29, 2023, a move that triggered a hike in the cost of the product.

The President, however, promised to roll out measures, including CNG-powered mass transit buses and tricycles, to cushion the impacts of the subsidy removal. After almost one year in office, that initiative is set to come to life.

According to presidential aide, Bayo Onanuga, the Federal Government planned to launch its compressed natural gas initiative in May ahead of President Bola Tinubu’s first anniversary.

“In all, over 600 buses are targeted for production in the first phase that will be accomplished this year,” he said in a statement.

“A new plant on the Lagos-Ibadan Expressway will assemble thousands of tricycles. The SKD parts manufactured by the Chinese company, LUOJIA, in partnership with its local partner to support the consortium of local suppliers of CNG tricycles are set for shipment to Nigeria and are expected to arrive early in May. About 2,500 of the tricycles will be ready before May 29, 2024,” he added.

Onanuga said the Federal Government was targeting the purchase of 5,500 CNG vehicles (buses and tricycles), 100 electric buses and over 20,000 CNG conversion kits, in addition to spurring the development of CNG refilling stations and electric charging stations.

“With necessary tax and duty waivers approved by President Tinubu in December 2023, the Presidential CNG Initiative committee is partnering with the private sector to deliver the promise of the initiative. The private sector has responded with over $50m in actual investments in refuelling stations, conversion centres, and mother stations,” he said.

Also, the FG, through the Chief Executive Officer of the Nigerian Midstream and Downstream Petroleum Regulatory Authority, Farouk Ahmed, had issued a directive mandating oil marketing companies to instal CNG pumps in filling stations across the country.

Ahmed, who described the push by the Federal Government to encourage the use of CNG as an alternative to petrol as a revolution, said the government was determined to reduce the burden of petrol on the economy. As such, the government said intending retail licensees would now be required to establish CNG points in their filling stations before getting final government approval.

He said, “We want to reduce the burden of the importation and consumption of PMS. We explored the possibility of converting the energy requirement of retail outlets and depots by the stakeholders here going into solar, but there is a high entry cost. We have discussed that, and it is going to be in phases. By doing so, we will reduce the demand for diesel in terms of powering our generators by utilising solar options. Once we are done with consultations, we will require that CNG add-ons be put in petrol stations and for new applications, one of the requirements will be that you must have a CNG add-on in the petrol station.”

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ANOH gas project can provide electricity for five million homes — Seplat Energy

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The board chairman of Seplat Energy, Udoma Udoma has announced that the newly inaugurated Seplat Energy ANOH Gas Processing Plant can generate electricity for 5 million Nigerians.

Udoma stated this at the commissioning ceremony of the plant, held in Ohaji, Imo State, by President Bola Tinubu.

Built by the ANOH Gas Processing Plant Company (AGPC), the plant is a joint venture equally owned by Seplat Energy and the Nigerian Gas Infrastructure Company (NGIC), a subsidiary of the Nigerian National Petroleum Corporation (NNPC).

The plant achieved mechanical completion in December 2023, recording no Lost Time Incidents (LTIs) over 12 million man-hours.

With a Phase One processing capacity of 300 million standard cubic feet per day, the ANOH plant is set to deliver dry gas, condensate, and LPG to both domestic and international markets.

Tinubu praised Seplat Energy and its partners for their efforts, stating, “Today is a great day of achievement demonstrating teamwork, commitment, and dedication to duty. I congratulate you for all you have done for the country and for fulfilling this in only 11 months.

“The ANOH gas project strongly aligns with Seplat Energy’s mission of leading Nigeria’s energy transition with accessible, affordable, and reliable energy that drives social and economic prosperity.

“As a testament of our pledge to Nigeria, in partnership with the NNPC Ltd, we have delivered this project that will support the current administration’s drive for industrialization and growth of the economy through low-cost reliable power.

“To put this into context, if all of the gas from this plant went into the power sector, it would produce enough electricity to transform the lives of over 5 million people. Given that Nigeria’s population is growing at a rate of over 5 million per annum, we need one of these plants a year every year just to meet the demand of our new arrivals.

“We appreciate the unwavering support of our partner NNPCL, the cordial relationship with our host communities, Imo state government and the support of all stakeholders that are too many to mention,” Udoma added.

CEO of Seplat Energy, Roger Brown, remarked, “Seplat Energy is pleased with the progressive reforms by President Bola Ahmed Tinubu and his administration. In March 2024, the President signed executive orders to enhance investments in greenfield gas development and midstream capital projects.

“Also, the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) recently improved gas prices under the DSO, to trigger further investments to the domestic gas sector – our ANOH gas plant will benefit from these reforms and incentives. No doubt, the ANOH’s gas will further reduce Nigeria’s carbon intensity and increase energy supplied to the Nigerian domestic market.”

The commissioning ceremony was attended by Seplat Energy’s board members, management and staff, government officials, institutional partners, traditional rulers, and industry players, among others.

Group CEO of NNPC, Mele Kyari, commented on the collaborative efforts, stating, “The ANOH Gas Processing Plant being commissioned by NNPCL and our partner is in line with Nigeria’s decade of gas agenda and particularly consistent with the administration’s efforts to boost gas supply in the domestic market.”

Imo State Governor, Hope Uzodinma, represented by Deputy Governor Chinyere Ekomaru, congratulated Seplat Energy on the timely completion of the project and expressed optimism about the opportunities it brings to the state.

Minister of State Petroleum Resources (Gas), Ekperikpe Ekpo, added, “With a capacity of 600 million standard cubic feet per day, the ANOH Gas Processing Plant is a shining example of advancement. This plant will greatly advance the availability of domestic gas which will boost power generation and hasten industrialisation.”

The ANOH Gas Processing Plant, which is situated in Ohaji, Imo State, is poised to emerge as one of Nigeria’s most important gas initiatives. It would speed up the switch from diesel generators to cleaner, more affordable fuels like natural gas for power generation and enable higher gas production.

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