Clean energy is gaining momentum as several countries are intensifying their climate change policies with a target to go carbon-neutral by 2050 or 2060, a development with dire implications for oil-dependent economies, including Nigeria. In this exclusive interview, Eberechukwu Oji, CEO of ND Western, shared insights on implications for Nigeria and how his company plans to respond with Dipo Oladehinde, Excerpts:
Can you tell us about your innovation-first strategy in Nigeria and the outlook for the future?
In line with our vision of becoming the energy company of choice in Africa, we have taken strides to become a fully integrated energy company by having a stake in the entire value chain of the industry, from the upstream which we currently deliver gas to the domestic and regional market, to midstream with the birth of Optimera Energy FZE, in partnership with Falcon Corp, and First Hydrocarbon Nigeria Ltd, to deliver gas within the Lekki Free zone and, the downstream with the development of a 10,000 bpd refinery which is at the Final Investment Decision stage.
We have the Utorogu Industrial Park being developed to deliver gas to industries within the Niger-Delta corridor. We are also looking at LNG, and CNG opportunities that want to develop in the long term. The future looks very bright for us as a company and Nigeria with the enhancement of the gas potential we have in our assets.
How can Nigeria’s decarbonisation policy contribute to economic growth, and what is the role of industry players to achieve this?
The decarbonisation policy would enhance investment in the development of R&D in technologies that would maximise emission reduction across different industrial sectors in the country and in turn create job opportunities as we can see in the Solar energy space.
For us in the industry, we must ensure that we necessitate the required technological and ideological training for our workforce by re-skilling and up-skilling both current and potential personnel for them to have the required technical expertise to achieve the common goal of transiting to a decarbonized economy. There is a need for collaboration between industry stakeholders to achieve this common goal.
During the 21st edition of the NOG conference, you highlighted the roadmap for Nigeria’s energy mix and decarbonisation policy. Can you expand on the elements critical to a sustainable roadmap for the country?
The key elements critical to achieving a sustainable road map for Nigeria’s energy mix can be actualized through 3 key factors;
Abundance/Availability of Gas, Solar Power, and Hydro Power, with a Proven gas reserve of 209.5Tcf, an assumed solar power potential of 427,000MW, and Hydro Power of about 14,120MW, Nigeria has the capacity to harness these resources, driven by gas to meet the energy demand in the country with current peak electricity demand around 20,000MW.
Affordability – with an average electricity cost of $0.139//kwh (about N65/kwh), Nigeria ranks 24th in terms of the low cost of electricity tariff in Africa and 7th in West Africa. In view of this, there is a need to produce affordable power for Nigerians and other regional markets.
Acceptability – With gas being accepted by the UN and EU as a cleaner source of energy and environmentally friendly amongst other hydrocarbons produced, There is a need to take advantage of our abundant gas coupled with renewable sources like solar to drive the cost of electricity down and also reduce our carbon emissions as it is expected that by 2030, 30percent of our energy has to be generated from renewable sources.
The need for sustainable growth is the availability of affordable and dependable energy. How can this be accomplished with the help of technical innovation and how does ND Western contribute to this?
As mentioned earlier, adequate funding in R & D and collaboration is required by both public and private players within the industry to see the best and most affordable technological innovations available to enable us to deliver affordable, sustainable, and reliable energy supply to the entire country and also other regional markets.
NDW is taking steps towards achieving this and adding our quota to the development in R & D, and workforce capacity building by collaborating with some of our institutions like FUPRE and also, a milestone achievement of revitalizing the Shell Industrial Training Programme (SITP) before the End of the Year 2022 (Hopefully by the end of September).
What sustainability-related difficulties are challenging the industry, how can they be addressed and how can progress be measured?
Being a major energy producer, Nigeria should drive the narrative for the energy transition in Africa. Nonetheless, gas represents the most sustainable and efficient way to meet our energy demand but, Nigeria currently lacks gas-related infrastructure due to a lack of investment. Nigeria should continue to advocate that a just energy transition means that immediate investment is still needed to develop gas infrastructure, combined with funding, and developing other renewable energy sources potential that is available. The progressions can be measured by the statistics set with the 2030 Nigeria Electrification Agenda with projections of adding 30GW of electricity by 2030 and 30 percent of this from a renewable source. Currently, about 80 percent of Nigeria’s power generation is through gas, and about 11 percent from renewables, so we can see where we are presently and see what is needed to be done to achieve our projected targets by 2030.
Nigeria is blessed with abundant resources of fossil fuels and other renewable energy resources. How do you think the country can effectively utilise this?
The ability to utilise our fossil fuel resources lies in our refining capacity. There is a need and urgency for more investment in our refining capacity with technologies that will capture or neutralise carbon emissions and we hope the existing ones can be turned around on time for operationalisation. The government cannot afford to continue paying for petroleum subsidies with dwindling revenue and as a country, we cannot continue to import refined products. There is an investment needed to sufficiently develop our gas infrastructure, a holistic approach to curb crude theft and vandalism, and more investment in other renewables. With all these put in place, Nigeria will become a fully independent energy country, generate adequate FX earnings and improve the lives of its citizens.
What is the ideal way to integrate national and local initiatives to increase the mix of renewable energy sources, and how will renewable energy affect and be influenced by climate change?
With adequate collaboration, public-private strategic partnerships are required that will increase the energy mix and stimulate more investment in renewable sources because there is immense power generating potential from gas, solar, hydro, wind, and other sources than can be looked at with R & D, to meet our demands and influence the net-zero GHG emissions by 2050. That is why ND Western Limited is committed to playing its part in the energy transition by developing an ESG policy. Looking at our gas potentials, we have put in a plan to effectively track and reduce our scope 1 and scope 2 emissions.
The level of development in the oil and gas industry is progressively being caught up by the regulatory environment. To achieve collective advancement, how has ND Western adhered to regulations and collaborated with authorities?
ND Western has always maintained a good relationship with our regulatory agencies as we adhere to industry standards and policies. Furthermore, with the implementation of the Petroleum Industry Act (PIA), there is a need to consolidate the provisions of the PIA regarding investments in the energy sector.
We commend the Govt on some of its initiatives and we also implore that they address the gaps that exist in the implementation of the PIA and other statutory regulations in the energy sector as these policies should encourage and provide comfort for foreign investment in the energy sector.
Looking at the next ten years in Nigeria, what is the future like for the oil and gas sector and what level of advancement do you expect the sector in Nigeria to have achieved?
The opportunities are enormous for us to position ourselves as a major producer of LNG within the next couple of years. With the Russia-Ukraine war, which has disrupted gas supply in Europe leading to the high demand for gas from Africa, we need to sufficiently invest in developing our gas infrastructures to meet both domestic and global gas demand. This will be of great economic advantage as there will be FX liquidity and it would also create jobs in the country. So, there are expectations for a lot of development in the gas space with industrial parks like the Utorogu Industrial Park, and many others coming up. These are developmental projects that will create thousands of jobs for our host communities and, scale-up production in the manufacturing and industrial sector.