- Penalties for gas flaring to also increase
Chineme Okafor in Abuja
The Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, on Monday disclosed that the long-awaited terms that will provide business clarity around Production Sharing Contracts (PSC) in gas will be out for use before the end of 2016.
He also said the federal government has developed a draft national gas policy to be passed to stakeholders for consultation before its finalization.
He said within the policy, new and improved penalties for gas flaring would be adopted to discourage flaring and wastage.
He spoke at the 2016 edition of the Nigerian Gas Association (NGA) annual conference and exhibition in Abuja, and explained that the government plans prioritise gas as a stand-alone business, separate from oil, in the new policy.
Kachikwu said the new PSC gas terms was designed to ensure robust gas production and supply growth over a long-term period for the country.
According to him, government will also clear the bottlenecks in gas production and utilisation as reported in the Petroleum Act, and discourage Greenfield investments without clear-cut plans for gas.
“Government has developed a draft national gas policy which will be released later today to stakeholders for consultation.
“The draft gas policy promotes a competitive business environment for both current and new investors, it articulates our vision for the sector and sets policy goals, strategies and implementation plans for our medium to long term targets for gas,” said Kachikwu.
He added: “In order to ensure robustness in gas supply over a long-term, the following initiatives will be pursued – gas terms for PSCs will be produced before the end of 2016, exploration and development of new gas supply sources from inland and offshore basins will be actively encouraged, a national gas flare commercialisation plan will commence in the first quarter 2017.”