The adoption of options including establishing mini-liquefied natural gas (LNG) projects, purchase of spot cargoes of LNG and encouraging the development of oil and gas discoveries in the state would go a long way in the quest to deliver adequate gas to power Lagos, Nigeria’s commercial nerve centre, energy experts have said.
According to the experts who spoke at the ongoing 7th Lagos Economic Summit on Wednesday, there are gas resources in the offshore region of Lagos, with recent oil and gas discoveries capable of boosting gas supply to power plants in the state.
Afren and Lekoil recently made a significant light oil discovery at the high-impact Ogo-1 well located at Oil Prospecting Lease 310 adjacent the Lagos shoreline. Oil was also discovered at the Aje field located at Oil Mining Lease (OML) 113, which lies in the Benin Basin, about 43 kilometres offshore Lagos, by Yinka Folawiyo Petroleum and Chevron Nigeria.
“We must think of regasification. LNG must find their way into Lagos. The storage and the regasification are things that can be done. Barge-floated mini LNG will help to bridge the gas deficit,” said Bolaji Osunsanya, managing director and chief executive officer, Oando Gas and Power, adding that Lagos has gas resources that can generate 2,000 to 3,000 megawatts (MW) of electricity in the next three years.
“The resource is not enough, we must explore it. We must backwardly integrate. Lagos can set up a commodity purchase framework that will guarantee gas producers an uptake of their gas and make uptake bankable. There is need to expedite infrastructure to ensure gas supply,” he said.
Osunsanya stated that the quickest way to ramp up gas supply to power plants in the state was a mini-LNG dedicated to a plant close to berth.
Fisayo Delano, senior vice president, gas and power, CAMAC International Corporation, stressed the need to have adequate delivery mechanism for gas, adding that the completion of the Escravos-Lagos Pipeline System (ELPS) would bring about increase in gas supply to Lagos.
“There is nothing holding up the setting up of mini-LNG in Lagos. We have the molecules. NNPC has 49 percent stake in NLNG. We can establish floating storage and regasification units (FSRU), place them in Lagos, with shuttle tankers to deliver gas to the state from Bonny Island. We should also build an LNG regasification plant offshore,” he further said.
Lagos State can negotiate with the sponsors of LNG, like NNPC, to purchase spot cargoes of LNG since the markets in the United States have almost disappeared, according to Delano.
Femi Asu
