• Tuesday, July 23, 2024
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BusinessDay

Nigeria loses N470m daily from Escravos pipeline attack

Pipeline destruction1

As security agencies intensify the search for culprits behind the recent attack on the Escravos pipeline, latest information from the Ministry of Power, Works and Housing shows that the pipeline owned by the Nigeria Gas Company and connected to Chevron’s facility at Escravos is making Nigeria lose N470 million daily.

The sabotaged gas pipeline, which contributes to the Escravos Lagos Pipeline System (ELPS), has led to a loss of 160mmsfcd of gas daily and will also impact negatively on the 600mw Olorunsogo Power Plant.

“At a cost of $2.50 per thousand scf, this loss means about $400,000 loss to the country on a daily basis (N78, 800,000 daily) in gas volume.

This is in addition to losses to be incurred daily from failed power generation, amounting to $1,988,223 or N391, 680,000 daily,” according to data from the ministry.

This puts the total daily loss to the country at N470, 479,931, even as repairs to be carried out on the damaged pipeline are estimated to cost $609,137 or N120, 000,000.

The real sector of the economy has also been counting its losses as some cement companies around Olorunsogo, such as Ewekoro and Ibese, are similarly affected.

The latest incident occurred just as the Federal Government, through the ministry of power, works and housing and the ministry of petroleum resources along with allied agencies, intensified efforts towards improving gas supplies to the affected power plants.

According to the ministry, such efforts led to previously offline plants like Ihovbor and Sapele, coming back online and subsequently making up for the loss in power.

Available records show that six incidences of vandalism from December 2014 to February 2015, which affected the Trans Forcados Pipeline at Oben, Sapele, Oredo and the Escravos-Lagos Pipeline System, (CNL) led to a loss of 1,100 mmscfd of gas.