15. Session 5 Keynote Address NNPC David Ige Samue Lndukwe

8/19/2019 15. Session 5 Keynote Address NNPC David Ige Samue Lndukwe

1/34

Update on the Nigerian Gas

Master-plan

June 5th 2013

NOG Tech

Lagos, Nigeria

Dr. David Ige

Group Executive Director, Gas & Power NNPC


2/34

Outline

2

Our Scorecard

Gas Industrialization

Overview of the Nigerian Gas Sector

Investment Opportunities

Conclusion


3/34

Overview of the Nigerian Oil & Gas Industry

- Nigerian Oil & Gas Reserves Overview

Nigeria’s abundant oil and gas reserves base creates a robust platform for investment opportunities.

3

Source: BP Statistical Review or World Energy 2011EU Energy Portal; Transparency International, 2011 Report on

Oil and Gas Companies; NAPIMS, Daily Gas Production and

Utilisation Report (August 16, 2011)

0

5

10

15

20

25

30

35

40

R e s e r v e s

( B i l l i o n ) B a r r e l s

Nigeria’s Crude Oil Reserves (1980-2010)


4/34

Overview of the Nigerian Gas Industry

- Undiscovered Potential

Undiscovered potential is ever greater!4

600TCF Undiscovered Potential


5/34

5

Global Context

- Huge Discoveries Globally

SOURCE: EIA; Deutsche Bank; Shale Gas.com; USGS; NPC; company announcements; Team analysis

US natural gasresources have nearlydoubled through Shalefinds

Significant discoveriesin East Africa

Further discoveries inWest Africa

Recent changes in global energy dynamics shift attention to market share particularly in the East.India is a key part of that discussion


6/34

Our Strategic Aspiration for Natural Gas

6

GAS TO POWER

“… By 2014, we would have

positioned Nigeria firmly asthe undisputed regional hub

for gas-based industries such

as fertilizer, petrochemicals

and methanol.”

GAS

BASED INDUSTRIALISATION HIGH VALUE EXPORT

STRATEGIC THEMES OF GAS

MASTER PLAN

Consolidate Nigeria’s position and

market share in high value export

markets

• Regional gas pipelines – consolidatenational footprint and influence

Deliver on President’s Gas

Revolution Agenda to:

• Create regional hub for gas-based

industries – fertilizer, petrochemical andmethanol

• Transform gas sector to value adding

sector

• Deliver Gas for at least threefold

increase in generation capacity by

2015

LNGRegional

Pipelines

We are pursuing a clearly articulated agenda in gas


7/34

Unprecedented Growth in Gas Sector

The strategy paves way for an unprecedented growth potentially making Nigeria’s gas sector

number 5 in Africa in terms of BOE. FGN’s policy thrust through the Gas Master -plan has been toenable this rowth

868,000BOE

926,000BOE

7


8/34

The Gas Master-Plan- 4 Step Roadmap to Full Market Driven Domestic Gas Sector

Willing

Buyer

Willing

Seller!!

8


9/34

The vision is to attain full market status with ‘willing buyer willing seller’ by 2014/2015 9

The Gas Master-Plan- 4 Step Roadmap to Full Market Driven Domestic Gas Sector


10/34

Enabling Policy Framework

10

To support the gas agenda we embarked on an aggressive policy framework revamp to create anenabling investment environment

Bankable commercial framework

reforms in pricing and revenue

securitization to enable

sustainable investment in gas

supplyScalable Gas

Infrastructure

Blueprint

National Blueprint for Backbone gas pipeline

and processing infrastructure that will enable

flexibility in supply delivery

DSO Regulation in place to

jumpstart gas availability in the

short-term. Also legislative

reform through the PIB being

concluded

http://www.sxc.hu/browse.phtml?f=download&id=1147439http://www.sxc.hu/browse.phtml?f=download&id=1147439http://www.sxc.hu/browse.phtml?f=download&id=1147439http://www.sxc.hu/browse.phtml?f=download&id=951425http://www.sxc.hu/browse.phtml?f=download&id=951425http://www.sxc.hu/browse.phtml?f=download&id=951425http://www.sxc.hu/browse.phtml?f=download&id=951425http://www.sxc.hu/browse.phtml?f=download&id=1147439


11/34

Outline

11



Our Scorecard


Conclusion


12/34

12

Current Status of Domestic Gas Supply

We have grown utilizable domestic gas supply capacity to highest ever level of 1500mmcf/d andstill growing

Domestic supply is

growing steadily and

to forecast!

m m s c

f d


13/34

Additional Gas Supply Projects

13

A second wave of supply projects is being developed with planned capacity of 2150mmcfd between 2015 and

2019 effectively doubling the domestic gas market. A total of 6 projects are being progressed at various stagesof development


14/34

Impact on Power Sector

- Gas to Power

Gas to Power (2013-15) Gas to Power (Longer Term View)

Meeting the Power Sector requirement is a focus area for the gas sector and good progress isbeing made


15/34

Domestic Gas Reforms

- Gas Pricing Reform

15

Pricing reform is taking hold, creating a more robust basis for investment in supply


16/34

Progress Update on Gas Infrastructure Development

16

24” x 31km;

Project has been completed

and currently supplying gas

to Olorunshogo power plant

Addresses permanently the

challenge of supply delivery

to Olorunshogo PHCN/NIPP

Plants

36” x 136km; from Oben to Geregu

Project completed in Nov ‘11

Addresses supply deliverability to Geregu

power plant and future expansions

ELPS 2 – Oben-Lagos

Itoki- Olorunshogo

ELPS A Escravos – Warri – Oben

Oben – Geregu

24”/30” x 104km;

Project has been completed

Addresses stranded gas in Escravos – additional

80mmcf/d (300MW) is currently supplied to the

domestic market and a further 70mmcf/d(250MW)

by October

36” x 324km;

Ongoing project will double

capacity from 1bcf/d to

2bcf/d by Early 2014

Project is ongoing

Enable expanded supply to

support all future power and

industry expansion

Steady progress has been made in delivering the critical pipeline infrastructure. This will address many of thegas deliverability challenges

1

2

34

12

3

5

Obiafu/Obrikom - Oben

(OB3)

48” x 127km; Contract was awarded by FEC

in April 2012

Detailed engineering almostcompleted Completion Date – Early 2015

5


17/34

17

ELPS 2 – (Oben – Lagos)

• Project ongoing

• Expected completion

date – Early 2014

Ob/Ob – Oben (Ob3 pipeline)

• Project ongoing,

commenced detailed

engineering

• Expected completion date

– Early 2015

Gas Pipeline Infrastructure

Planned gas supply

availability

AKK and CAP projects• Planned to kick off in

2013

• Expected completion

date - 2017


18/34

Outline

18


Our Scorecard



Conclusion


19/34

19

CENTRAL PROCESSING FACILITY

FTZ BASE INFRASTRUCTURE PORT INFRASTRUCTURE

PETROCHEMICAL PLANT FERTILIZER PLANT

Gas Based Industrialization Agenda

- The Ogidigben Industrial Park

POWER PLANT OTHER SUPPORT SERVICES

Aims to create the largest gas industrial park Sub-Saharan Africa with Fertilizer, Methanol andPower projects.

AnchorInvestors

SupportInvestors

- SPV


20/34

20

Ogidigben Gas Based Industrial Park

- Africa’s Largest Gas City


21/34

Outline

21


Our Scorecard



Conclusion


22/34

22

CENTRAL PROCESSING FACILITY

FTZ BASE INFRASTRUCTURE PORT INFRASTRUCTURE

PETROCHEMICAL PLANT FERTILIZER PLANT


POWER PLANT GAS PIPELINE INFRASTRUCTURE

Aims to create the largest gas industrial park Sub-Saharan Africa with Fertilizer, Methanol andPower projects.

AnchorInvestors

SupportInvestors

- SPV


23/34

Outline

23


Our Scorecard

Conclusion




24/34

Conclusion

24

Reforms are being put in place and holding

Aggressive expansion plans and huge investment opportunities

You can playing a key role by taking opportunities as they come

Contrary to some view, Nigeria is open to business

Now is the time to invest in the gas sector of Nigeria ……just

examine the fundamentals!!!


25/34

25

THANK YOU


26/34

The Domestic Supply Obligation Policy

26

The gas supply to underpin agenda is from the Domestic Gas supply Obligation (DSO)


27/34

Domestic Gas Price Transition

27


28/34

28

Gas Pipeline Infrastructure Blueprint

- Aggressive Expansion in Progress


29/34

Ogidigben Gas Based Industrial Park

- Africa’s Largest Gas City


30/34

Gas Pipeline Investment Opportunities

30

QIT

Bonny NLNG

Uquo

Alscon

Ibom

Power

Calabar

NIPP

Unicem

CementImo River

Alaoji

NIPP

Aba Industries

Indorama

Obiafu/Obrikom

Obite

225mmscfd

Alakiri

100mmscfdGTS 1

Cawthorne

Channel

Geregu

NIPPAjaokuta

ELPS 1

ELPS 2

Egbin

OlorunshogoOmotosho

Ibadan

Jebba

Forcados Yorki

Bonga FPSO

Erha

Ogidigbe

Industrial City

Oben

Odidi1

2

3

Investment Opportunities: East North Gas Transmission System


31/34

Escravos

ELPS 2

Obigbo Node

QIT

Oben

Investment Opportunities: East-North Gas Transmission System

- A Private Public Partnership (PPP) Case


32/34

32

East-North Gas Transmission System- Early Gas Scenario


33/34

NNPC

EPC Contractor /

ContractorFinancing

Proposed Financing Structure

ECA 3rd Party Debt

FGN Annual

Appropriation

3rd Party

Equity

Participation

FGN

EurobondEquity

Debt


34/34


GAS PROCESSING FACILITY /

GAS BASED MANUFACTURING

FINANCIAL SERVICES

UPSTREAM GAS

DEVELOPMENT

GAS TRANSMISSION

PIPELINES

LNG & LPG PLANTS

PIPE MILLING AND

FABRICATION YARDS

$16 Billion

Investment

Opportunity

1

2

3

4

6

OGIDIGBEN FTZ INFRASTRUCTURE,

PORT INFRASTRUCTURE & REAL

ESTATE DEVELOPMENT

5

7
http://images.google.com/imgres?imgurl=http://www.nms2002.com/Route99/Trade%20specific/LNG/Screen%20shots/LNG%20Golar%20Mazo.jpg&imgrefurl=http://www.nms2002.com/Route99/Trade%20specific/LNG/route99_in_lng_trades.htm&usg=__DTG_N_iMDnHi0aNXEDis-6dgrM0=&h=450&w=600&sz=53&hl=en&start=9&um=1&tbnid=hhN_3QSsFGXoBM:&tbnh=101&tbnw=135&prev=/images?q=lng&um=1&hl=en

Documents

15. Session 5 Keynote Address NNPC David Ige Samue Lndukwe