The group managing director of Nestoil Limited, Dr. Ernest Obiejesi, has called for initiatives that would boost the domestic gas supply market. Obiejesi made the call at the fourth Nigeria Gas Conference held in Abuja, saying that the power sector holds the key to stimulating growth in the domestic market. The Nestoil boss said the gas supply industry in Nigeria will experience a boom if the liquidity issues in the power sector were fixed. He explained that the power sector accounts for over 80 per cent of the domestic gas market. According to him, liquidity issues in the power sector means that gas producers are owed huge sums of money for gas they have supplied.
Obiejesi 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, describing it as an audacious and innovative step by government to discourage gas flaring. He said 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.” The GMD of Nestoil urged government to continue to encourage indigenous players in the Oil and Gas industry.