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PMB Set To Unlock Economic Potential Of Northern Nigeria

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…Flags off Legendary AKK Gas Project Today

As President Muhammadu Buhari, today flags off the construction phase of the Ajaokuta-Kaduna-Kano (AKK) Gas Pipeline project, the initiative can be describe as the nation’s best move towards boosting social economic development of the northern region in particular and the country in general. FESTUS OKOROMADU reports

 

The social economic fortune of the northern region of Nigeria is set to witness a transformation as President Muhammadu Buhari flags off the construction phase of the Ajaokuta-Kaduna-Kano (AKK) Gas Pipeline project.

The project which economic experts has described as legendary will no doubt redefine the developmental status of the region in particular and the nation in general as it will among others improve domestic gas supply, power generation and industrialisation.

According to the Nigerian National Petroleum Corporation (NNPC), the initiators and operators of the project, President Buhari would today, 30th June, 2020, virtually flag off the construction of the project simultaneously in Ajaokuta in Kogi State and Rigachikun in Kaduna State.

Indeed, the AKK Project when completed would provide the domestic market with 2.2 billion cubic feet (BCF) of gas, provide addition 3,600mega watts of power to the national grid and revitalise textile industries which alone can create over three million jobs in parts of the country.

In addition, it will support the development of Petrochemicals, fertiliser, methanol and other gas-based industries that will generate employment and facilitate Balanced Economic Growth.

 

Harnessing Natural Resources For National Benefits

While Nigeria is general described as an oil producing country, Petroleum Industry experts say it is a gas province with little oil. As at last count, Nigeria is said to boast of 202 trillion cubic feet (tcf) of proven gas reserves, ranking 9th in the natural resource globally and first in Africa. For instance, the United States Geological Survey estimates that Nigeria’s gas reserves potentials could be as high as 600 trillion cubic feet.

But unfortunately, the nation’s focus had been on crude oil production and export, hence until very recently, there had not been a deliberate search for gas in Nigeria. Consequently, despite the huge natural gas resources of the country, the domestic gas utilisation is low, with data revealing that, of the Liquefied Natural Gas and Gas to Liquid (GTL) produced in Nigeria, only 47 per cent is consumed in-country, 44 per cent exported, with 9 per cent flared. The low per capita domestic gas consumption is attributed largely to infrastructural deficiencies.

Fortunately, the President Muhammadu Buhari’s administration since assumption of office has shown commitment to investments in gas infrastructure which, sooner than expected, would boost domestic utilisation of natural gas. One of such is the proposed Ajaokuta-Abuja–Kaduna–Kano Gas Pipeline which is a section of the Trans-Nigeria Gas Pipeline (“TNGP”) with a capacity to transport about 2.2 billion cubic feet of gas per day.

 

The AKK Pipeline

The project concept is designed to originate Pipelines from Ajaokuta, in Kogi State then traverse Abuja (FCT), Niger, Kaduna and terminates at Kano. It is expected to be fed from the existing domestic Infrastructure with a capacity of over 1.5 Bcf/d and is being expanded by Escravos-Lagos Pipeline System II (ELPS II) and Obiafu-Obrikom 3 (OB3) gas pipeline (under construction) that will double the capacity to over 3billion cubic gas per day.

The right of way for the proposed AKK gas pipeline is planned to run parallel to the existing Nigerian Pipelines and Storage Company’s 16 inch-crude oil and 12 inch- product pipelines wherever possible.

The Engineering Procurement and Construction Contract (EPC) of the project which was awarded by the Federal Executive Council in 2017 has a completion period of 24months and defect liability period of 12months.

 

Project Scope

The Scope of Work includes Engineering, Procurement, Construction, Installation, Testing and Commissioning of a 40” x 614km class 600# pipeline system from Ajaokuta to Kano with associated intermediate and terminal facilities to supply natural gas to off-takers at Abuja, Kaduna, Kano and Zaria environs and along the environs of the pipeline route.

The scope of work for the EPC for the AKK Gas pipeline segment is as delineated below.

Segment 1; Engineering, Procurement and Construction of 40” X303.4 Km linear pipeline system from Ajaokuta to Kaduna; (Kp 0 to Kp 303.4), Ajaokuta MS/TGS, Abuja IPS and all sectionalizing BVS, inclusive of BVS 12 @ Kp 303.4, with a 20” x 15km spur line

Segment 2; Engineering, Procurement and Construction of 40” X310.6 Km linear pipeline system from Niger State (Kp 303.4 to Kp 614), Kaduna TGS, Kano TGS and all sectionalizing BVS, exclusive of BVS 12 @ Kp 303.4, with a 24” x 15km spur line.

 

Actualising the Nigerian Gas master Plan (NGMC)

The AKK gas project is a component of the Nigerian Gas master Plan (NGMC), a gas infrastructure blueprint, which was approved by the Federal Executive Council in 2008, but which has received serious attention of the Buhari Administration. The other major domestic gas transmission systems are: The Western System, that is, the existing 36” Escravos-Lagos Pipeline I and II with 2.2 billion cubic feet capacity and the On-going East-West connection via the Obiafu/Obrikom-Oben Pipeline (OB3) featuring 2.4billion cubic feet per day capacity.

 

Economic and Social Benefits of the AKK Project

As earlier stated, the AKK Project is expected to unlock the domestic market by providing 2.2 BCF/D Natural gas to the market. In addition to facilitating the development of three (3) base Independent Power Plants (IPPs) in Abuja (1350MW), Kaduna (900MW) and Kano (1350MW) as well as steer the development of gas based industries along its corridor and beyond.

Economic experts has estimated that over 232 industries are expected to be revitalise through the execution of the project. Thus resuscitating the possibility of resolution of job to the over three million persons who lost their jobs in Kaduna alone due to power crisis and closure of textiles industries. This is in addition to jobs expected to be created by establishment of industries such Petrochemicals, Fertiliser, Methanol manufacturing companies and other gas based industries.

Better still the financial benefit are enormous as the AKK Project will translate to the monetization of abundant gas resources hitherto locked up due to infrastructure deficit.

According to estimates by the global financial expert, Goldman Sachs, for every 5,000MW of increased power supply in Nigeria, approximately 1 per cent GDP growth per annum will be added.

By implication, based on current real GDP, this amounts to approximately $1 billion per annum. Given a conservative pipeline useful life of 30 years, this effect alone on the power sector will therefore produce a conservative cumulative gain to GDP of USD 30 Billion.

 

Ready to go

Arriving at today’s presidential flag-off of the construction phase of Ajaokuta-Kaduna-Kano pipeline did not happen overnight. Lots of players, at government, technocratic and at other leadership levels had worked committedly, culminating into the event of today. The glory and euphoria of the day belong to all who have contributed, in one way or another, to the gas development efforts of the Country. The Buhari Administration will ever be remembered for taking the practical step to ensuring energy security for the country by consolidating Nigeria’s aspiration to have a national energy mix that works for the Country and the entire citizenry.

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