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Delta partners NNPC to access new gas opportunities

By EMMA AMAIZE Regional Editor, SouthSouth
EVIDENTLY, not many Deltans   understood the unusual energy their governor, Dr. Emmanuel Uduaghan has been exerting lately on any matter that had to do with gas exploration in the country until the Monday, July 20 stakeholders’ meeting that was held at Asaba, the state capital, by the state government to sensitize the people on the   National Gas Master Plan and the expected benefits to both the government and people of the state.

Gov. Uduagham
Gov. Uduagham

The scale fell from the eyes of those who viewed the governor’s earlier trips to Abuja , London and Singapore for gas “road shows” as frittering away of meagre resources, as they came to the realization that gas, and not oil, is the in-thing for an economic breakthrough for the state.

In fact, there is a gradual drop in the consumption of fuel by the world’s major users, as gas is a cheaper source of power, and in no distant future, countries relying on petroleum for survival would be begging for buyers. Group managing director of the Nigeria National Petroleum Corporation (NNPC), Mr. Mohammed Sanusi Barkindo, who was represented by his technical adviser and general manager (upstream), Dr. David Ige told the people of the state that it takes a visionary to see the future and do what the governor is doing ahead of other Niger-Delta states in tapping into the National Gas Master Plan.

The totality of it all is that gas is going to become the new top revenue earner in the country soon, and that Delta state, which accounts for 40 per cent of the 185 trillion cubic feet (TCF) of proven gas reserve and 600 trillion cubic feet potential in the country can fast track its development beyond imagination if the right things were done at the right time. At the last check, investors were waiting for approval from the NNPC to come in with about $10 billion investments in gas gathering facilities, which ripple economic effects, will be transforming for the people of the Niger-Delta at large. The NNPC is also jump-starting new three central gas processing hubs in the region, one in Delta state, the other in Rivers state and the third in Akwa-Ibom state, which it hopes to be completed in 2011.

Foundation for a greater Delta: Governor Uduaghan is widely travelled; he knows the gas story of Trinidad and Tobago, which was later, told the people by Dr. Ige and consultant, Dr. C.B. Alalade of Petro Consult Energy Limited; he also knows what the state government and people stand to benefit from the National Gas Master Plan and that is why he quickly sort a partnership with the NNPC to leverage on its expertise. Speaking at the meeting, he said, “I welcome you all to this epoch event. Today’s event is a further affirmation of the desire of the present administration to harness every resource towards the building of a greater Delta state”.

“First, the significance of this project is that it strives to develop a strategic partnership between NNPC and Delta state. This strategic partnership offers many solutions to a range of our challenges namely: peace and development, youth restiveness, economic integration, unemployment, lack of skilled personnel etc. It will also provide an opportunity for strong business partnership to be developed and entered into, leveraging on the expertise of our partners.

“With Delta state being the pioneer of this strategic partnership, it is not out of place that the first meeting is taking place here today. The Delta state Gas stakeholders’ meeting on the Nigerian Gas Master Plan is to sensitize everyone about the Nigerian Gas Master Plan, inform our people about the opportunities for the State, and to communicate the economic value of natural gas and how the state can position itself in order to ensure maximum benefit for our development”, he asserted.

Inspiration: “In fact, it  was the people’s    interest that first fascinated us and formed the basis for our quick alignment, support and commitment for the Nigerian Gas Master Plan.

Our enthusiasm has also been marched by the support and willingness of NNPC to collaborate with us. This is further demonstrated by the Group Managing Director’s approval for the concept of the strategic partnership framework for the Niger Delta States. Apart from being the first to host the stakeholders meeting on the Nigerian Gas Master Plan, we are the first to inaugurate its own joint working group.

There are other Niger Delta States covered by the Gas Master Plan, however, I do believe that Delta State’s position today, as the pioneer of this approach, arose from our keen interest, having participated openly at the Road Shows that took place in Abuja on the 15th, London on the 19th and Singapore on  May 23, 2008.

Therefore, the greatest work ahead of us is to structure our strategic partnership framework with NNPC in a way that business opportunities can be developed, and that Delta State is a State of choice for would be investors. “To underscore our seriousness and to ensure that we derive the maximum benefit from the Gas Master Plan, I shall inaugurate our one stop shop centre to be called: Delta State Joint Advisory Committee on the Gas Master Plan. This Committee will consist of members from Delta State Government and NNPC”, he said.

Investors’ preference: “To be the destination of choice for investors we know that as a government we need to meet certain needs and requirements of the investor. Issues like land, community needs and skill requirements, government incentives, peace and security are on top of the table. I wish to assure everyone that the government has put in place structures that can assist the investor to settle in quickly and conduct his business. “We are also considering seriously the skills needed by the companies.

The state is home to Petroleum Training Institute (PTI) Warri, which we shall tap into, at the same time as we are in collaboration with UNDP to set up skill acquisition centres as well as using our polytechnics to train Deltans in electrical and wielding skills, which I know these companies will require when engineering work begins and the investments mature. In summary Delta state is ready.

Our body, hearts and mind are fully charged to make a success of this opportunity over the next three to four years when these projects would come on stream fully. Delta state remains one of the safest states in the Niger Delta, if not the country. Our crime rate is low and our communities are peaceful.

The challenge of the Niger Delta struggle is a peculiar one, but I can say that the worst is over. Actually, it is when projects like this are initiated taking the people along that you make it impossible for those who want to disrupt public peace and social order fail, because they would have no base to pursue their action. And more than that, they would be on the wrong side of history. Finally, I wish to emphasize that our three- point agenda of Peace and Security, Human Capital Development and Infrastructure Development are well on course; and I call on every Deltan to work with us to make this project a reality”, he added.

Gas will topple oil: NNPC’s GMD commended Uduaghan’s three-point agenda, saying that he has been watching the steady progress of his government in the last two years and was fascinated by the well-thought out policies and programmes, starting with the international airport project in Asaba, the Asaba Township Stadium, youth empowerment and agricultural schemes, micro-credit programmes, roads and bridges, novel peace and security strategy, streetlight project, engagement approach, adding, it was obvious Dr. Uduaghan knew that infrastructure is the core of development.

He said Nigeria produces about three million barrels of gas per day and is in the top 10 league in the world but gas, with a proven reserve of 185 trillion cubic feet and a potential of 600 trillion cubic feet is what is going to catapult the country to the next level. According to him, the details have been carefully worked out in the National Gas Master Plan and the NNPC, having learnt from the mistakes of the past concerning oil exploration, was not going to allow extraneous forces to sabotage the policy. He confirmed that over 45 global investors applied for the $10 billion worth of gas opportunities out of which 15 have been pre-qualified.

Trinidad and Tobago  story: NNPC   general manager (upstream), Dr. Ige who presented one of the key papers at the session told the Trinidad and Tobago story. It is a story of the transformation of a small Island in the Carribean with a population of about 1.5 million persons, which is not up to the 4 million or so of Delta state from grass to grace with a proven gas reserved of 15 trillion cubic feet and 30 trillion cubic feet potential. Nigeria, as stated before, has a proven gas reserve of 185 tcf and 600 tcf potential and you will be shocked that Trinidad and Tobago, which started what the NNPC is trying to do 14 years later in 1996, is the world’s largest exporter of methanol, ammonia and  fertilizer, all based on natural gas. It is also a leading exporter of liquefied natural gas to America with just 30 tcf of gas, which is not up to Nigeria’s 185 tcf, which Delta state alone accounts for 40 per cent, that is more than 40 tcf.

The people’s fears answered: By the time Governor Uduaghan, Dr Ige and Dr. Alalade ended their presentations, the people that were present had no little or no doubt any more on the viability of the project if well handled.. The major question that arose was how the host communities would benefit, as the oil companies cheated the communities in the past.

The Orodje of Okpe, Major-General Felix Mujakperuo (retd.) vocalized the worry. Governor Uduaghan agreed with him, saying he had taken up the matter with the foreign investors and NNPC even before the stakeholders’ meeting. While the NNPC, representing the Federal Government is grabbing 60 per cent of the shares, he said the state government had made it clear that it will not take anything less than 10 per cent, five per cent for the government and the other five per cent for the host communities through special purpose vehicles.

Virtually all the questions asked  by the people were on the   ownership structure and Uduaghan, who asked those that have questions to write them down on papers said they be photocopied by the NNPC and shown to Mr.. President for a better appraisal of the concerns of the people. Dr. Ige, however, assured the Orodje of Okpe who raised a poser on the dominance of oil companies, which could use their power to sabotage the new gas venture that the new Gas Master Plan has taken care of such inherent flaws and that the dominance would be broken with the entrance of more players. Already, Gazprom from Russia, British Gas, British Centrica (Britain), Em Rhuges (Germany), Statoil Hydro (Norwegian), Shell (Anglo-Dutch), Chevron (USA0, Gas National (Spain), Union Fenosa (Spain), Gain (India) and others have shown interest in the gas project.

Support Uduaghan to unshackle Delta – Osakwe
Deputy chairman of the Senate Committee on Gas, Senator Patrick Osakwe who presided at the stakeholders’ meeting called for the liberalization of the oil sector.

Senator Osakwe condemned the “over involvement” of the Federal Government in the oil and gas sector and, therefore, sought the removal of the Petroleum Ministry from the Department of Petroleum Resources. He urged Deltans to support the administration because the governor is a man of vision. The NNPC managing director also spoke of the governor’s visionary traits, saying he was impressed with his Asaba International Airport project, peace and security agenda, micro-credit scheme, agricultural empowerment and street light projects. He enjoined Niger-Delta youths to shun militancy, saying it was because of lack of jobs that the youths went into armed struggle and that with the jobs that were bound to come with the new gas initiative, the involvement of Delta youths in unwholesome activities often associated with militancy would reduce.


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