For Nigeria’s vast natural gas resources to positively impact the economy and citizens, Dangote Industries Limited (DIL) has urged the Federal Government to deploy new strategies to unlock and exploit its potentials and maximise its use.
Speaking at a panel session at Bussinessday’s Energy Series 2020 Virtual Conference, the DIL Group Executive Director, Strategy, Capital Projects & Portfolio Development, Devakumar Edwin, stressed the need for value addition in the sector to transform Nigeria from exporter of raw materials to exporter of finished, value-added products.
Edwin, speaking on the theme of the conference, “Gas Market Development – Opportunities, Drivers & Challenges,” stated that adding value to natural gas would strengthen the petrochemical industry. He added: “In the same vein, it will boost the economy and solve the hydra-headed problem of unemployment with its multiplier employment effect.”
“The industry uses a variety of hydrocarbon feedstock from refinery and natural gas. One of the problems facing the industry is lack of reliable feedstock supplies. Nigeria has the potential to be a major petrochemicals producer.”
However, in spite of the “proven gas reserves, not much has been accomplished with respect to the effective exploitation and utilisation of this resource, as most of the nation’s natural gas production has been liquefied for export.
“In sub-Saharan Africa, we produce raw materials and export to other countries. Our products are refined or manufactured and exported back to the continent. Really, the raw materials are taken out and value added and brought back to the continent.
“Nigeria has done well in respect of reduction in gas flaring to almost 10 per cent and export of natural gas to generate revenue, but our focus at Dangote is how to add value to the natural gas, after all, this Liquefied Natural Gas (LNG) being imported by various countries is used as feedstock.
“They use this natural gas to generate power, fuel and as feedstock. The value-added products are thereby exported to Nigeria.”
More so, “if you look at petrochemicals, we import almost all our petrochemicals. Fertilizer is also being imported. So, if we focus on adding value to natural gas that we produce and export the finished products – fertilizer or petrochemicals, our export revenue will be much larger.”
Edwin explained that to this end, DIL is focused on adding value to the country’s gas resources through the Dangote Subsea Gas Pipeline Project, which is expected to unlock significant gas supply for industrial activities and considerably reduce flaring in Nigeria.
He listed the benefits of the project to include making gas readily available for commercial use, ending gas import, diversifying the economy, increasing government revenue, meeting domestic petrochemical products demand, ensuring FX increase from export, and creating thousands of direct and indirect jobs.
According to him, the gas pipeline will help feed the fertilizer plant, connect the Niger Delta to the Lekki Free Trade Zone (LFTZ) in Lagos and also capture flared gas from offshore platforms to be monetized.
Declaring the conference open earlier, the Minister of State for Petroleum, Timipre Silva, said the Federal Government was providing infrastructure to deepen the gas sub-sector of the oil industry, while efforts have been renewed for the Petroleum Industry Bill (PIB) to be passed without further delay.