The Nigerian National Petroleum Company Limited (NNPC) on Thursday said that it plans to replace almost all the over 5,000 pipelines network scattered across the country in the next three years.
Nigeria currently transports a large portion of its fuels through tankers and other inefficient means, considerably raising the cost of production and by extension the pricing of products.
Speaking at the 2024 edition of the Society of Petroleum Engineers Oloibiri Lecture Series and Energy Forum (SPE OLEF) held in Abuja, the NNPC Group Chief Executive Officer, Mr Mele Kyari, explained that pipelines remain the most efficient and cost-effective way of transporting petroleum products.
He stated that a Build, Operate and Transfer (BOT) mechanism had already been kicked off to ensure that the process is completed by 2027, stressing that trucking products by road remains a critical challenge to the oil and gas sector.
“The cheapest way of transporting petroleum is by pipelines and that is why particularly our NNPC network of pipelines permeating all over the geopolitical zones, about 27 locations and over 5,000 kilometres of pipelines across the country, are being revamped.
“We have commenced a BOT process, where nearly all the pipelines will be replaced over a period of three years. As we do this, we are also reinforcing the ability of the network to deliver products to locations. We are already putting these capabilities to work. This is something that must be done.
“Otherwise, we will continue to use trucks which constitute a major challenge to our roads, especially the pressure it places, and it’s already work in progress,” he revealed.
Kyari’s keynote address was themed: “Stability in the Energy Sector: Integrated Strategies for Infrastructure, Transportation and Security.”
To bridge the energy access gap in Nigeria, Kyari said NNPC was working on developing the right infrastructure to deliver oil and gas to drive prosperity for Nigerians.
“We are committed to developing gas infrastructure across the country. We are dedicated to investing in critical infrastructure to enhance economic prosperity by supplying gas to the domestic market, targeting at least 8 billion cubic meters,” Kyari added.
He listed some of the infrastructural projects being undertaken by the NNPC to help bridge the energy access gap in Nigeria to include the Obiafu/Obrikom/Oben (OB3) and Ajaokuta-Kaduna-Kano (AKK) pipelines, adding that they are designed to enhance the nation’s gas supply network.
On the global front, Kyari said NNPC was working on expanding gas supply to the international market primarily through the NLNG Train 7 project, while efforts were also being made to kick off Train 8 as well as the various floating LNG initiatives.
The GCEO called for support in leveraging Nigeria’s abundant gas resources for economic prosperity, emphasising the need to bridge access gaps in electricity and clean cooking fuel.
Also speaking, the Minister of State, Petroleum (Oil), Senator Heineken Lokpobiri, stressed that there is an ongoing robust approach by the government to revamp the energy sector, not only domestically but extending it to the international community through friendly competition of energy supply to the international market.
He opined that integrated strategies for infrastructure development means taking advantage of the abundant fossil fuel to save against the future, while considering transitioning into other renewable energy sources, such as solar and wind, to diversify Nigeria’s energy mix.
Represented by the Director, Upstream at the Ministry of Petroleum, Kamoru Busari, he stressed that there was the need to implement new policy directives that will promote cost efficiency in local content development, eliminate barriers to investments and incentivise foreign investment and partnerships.
“The government is setting the pace as practical steps in infrastructure are being taken to increase local refining capacity by ensuring the existing refineries come on stream, while ensuring that more attention is paid to modular refineries as quick wins to complement the increase in domestic refining capacity towards energy self-sufficiency,” he stated.
According to him, insecurity remains one of the most critical challenges in the oil and gas sector and still poses a threat to ramping up production despite government efforts.
“Over the years insecurity has posed as one of the most pressing challenges to stability in the Nigerian energy sector. There have been cases of pipeline vandalism, oil theft, and sabotage, that have caused significant threat to the sustenance of our energy infrastructure and smooth operations,” he stated.
Chairman of SPE, Nigeria Council, Salahuddeen Tahir, in his comments, said that the programme focuses on contributing to Nigeria’s oil and gas industry policy development in commemoration of the first commercial oil discovery in Nigeria by Shell Darcy at Oloibiri, Bayelsa State, in 1956.
He stressed that energy plays a critical role in the functioning of any modern society, as it powers essential services such as transportation, heating, electricity generation, medical services, security, banking services and communication.
“Security is a fundamental concern in the energy sector. Disruptions to energy supply can have far-reaching implications on national security and economic stability,” he noted.
He stated that while progress had been made in expanding energy infrastructure and enhancing production capacities, significant challenges persist, particularly in areas such as transportation and security.
“The theft and vandalism of pipelines, coupled with inadequate infrastructure, continue to impede the efficient transportation of energy resources, undermining the sector’s stability,” Tahir added.
Besides, the Executive Secretary, Petroleum Technology Development Fund (PTDF), Galadima Aminu, stated that developing a robust infrastructure was fundamental for the efficient functioning of the energy sector.
“Consequently, there is a need to prioritise investments in building and maintaining petroleum and energy infrastructure to ensure a reliable energy supply in the country.
“Investing in road , rail and water transportation infrastructure is required to facilitate the transportation of energy resources, equipment and personnel within the industry.
“There is a need for the adoption of integrated security measures that encompass preventive measures, surveillance technologies and collaboration with security agencies to safeguard critical energy infrastructure,” Aminu, who was represented by the General Manager, Strategy of PTDF, Olayinka Agboola, said.
Emmanuel Addeh
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