Ernest Obiejesi, chief executive officer, Nestoil Limited, has said that power sector holds the key to stimulating growth in the Nigerian market, adding that the gas supply industry in Nigeria will experience a boom if the liquidity issues in the power sector are fixed.
Obiejesi, who spoke at the 4th Nigeria Gas Conference in Abuja, said the power sector accounts for over 80 percent of the domestic gas off take market. Liquidity issues in the power sector means that gas producers are owed huge sums of money for gas they have supplied.
He said this situation is a huge disincentive for gas producers to invest heavily in any form of gas gathering infrastructure. He commended the federal government for the recent Gas Flaring Regulation embedded in the 2017 gas policy. The policy is an audacious and innovative step by government to discourage gas flaring.
This initiative was, however, not far reaching enough. According to him, a permanent solution would be to address the liquidity issues in the downstream and power sectors to encourage much needed investments in gas gathering infrastructure that would eliminate gas flaring.
“Everyone agrees that a willing-buyer-willing seller arrangement is what will ultimately unbundle the gas industry in Nigeria and across the West Coast but government must be ready to make the right seed-investments and take the tough decisions that will enable the gas supply market grow into maturity,” he said.
– Oct. 19, 2018 @ 18:39 GMT |