Expert Advocates Creation of Infrastructure Entity in Petroleum Industry

Layi Fatona

Peter Uzoho

Worried by the inability of Nigeria to deliver steady electricity to its teeming population due to paucity of infrastructure for gas-to-power delivery, the Founding Managing Director of Niger Delta Exploration and Production (NDEP) Plc, Dr. Layi Fatona, has called for the establishment of a separate entity and business in the nation’s oil and gas industry that will focus on infrastructure development.

He explained that with the infrastructure entity or business in place, it would lead to the emergence of players who would specialise in investing in and delivering the infrastructure needed to take gas from the reserves to where they would be used for power generation.

Nigerians have been suffering from epileptic power supply attributed by some of the power generation companies’ lack of gas supplies from gas producers.

Speaking at a virtual seminar organised by the Nigerian Association of Petroleum Explorationists (NAPE) recently on the topic: “Impact of COVID-19 on the Nigerian Oil and Gas Sector–Challenges and Opportunities”, Fatona regretted a situation whereby the country has more gas deposits than oil but cannot use it to improve its power situation.

He dispelled the assumption that gas producers were delinquent in the supply of gas to power generation firms and that the gas producers have more capacity to deliver gas needed for power generation.

According to him, the major challenge to realising gas-to-power target was lack of robust infrastructure to enable movement of gas to power generation points, stressing that this could be addressed with the separate infrastructure entity and business in place.

Fatona said: “Every time the argument has come on its head as to why don’t we have power? The very easy scapegoat answer has always been that we didn’t have supply, but that is not true and I think I need to use well the opportunity that I have as a gas producer, a gas processor and a company that delivers gas for power.

“It is not always true that the gas suppliers are delinquent in their capabilities to supply gas.
“Indeed, if any other thing is true it is the fact that there is more capacity to deliver gas in this country than the people who want to take them. Now having said that, where is the infrastructure to deliver gas to the people who will like to use it to generate power?

“That is not robust enough, and that brings me to the very vexing question of infrastructure.
“This is a country that has not invested sufficiently in infrastructure; there is absolutely no need for Nigeria to still be flaring gas because we are still flaring gas till today, sadly so.

“But as a company we have endorsed the World Bank 2030 Initiative, where in all our operations we have actually eliminated gas flaring as part of our business.”

He added: “So the question then remains, the infrastructure to take gas from where it is available in the oil producing states to anywhere it can be used to generate electricity, and it is not all of us who is going to be able to do that.

“So there is need for us to really have an infrastructural entity or an organisation or companies who will take infrastructural development–investment in infrastructure, gas pipelines, very religiously, just like there are people who are taking the act of producing oil and gas as business. So there is a gap between where the gas is and who will take it holistically and use it to deliver electricity.”