By May 29 this year, it will be exactly one year that President Bola Tinubu took over the mantle of leadership as Nigeria’s President. During the swearing in of Tinubu as Nigeria’s 16th President about a year ago, his agenda for the economy was loud and clear- to target a higher Gross Domestic Product growth rate and to significantly reduce unemployment.
To achieve this, one of the things the President listed in his inaugural speech that he would do was to pursue an industrial policy that will utilize the full range of fiscal measures to promote domestic manufacturing,stimulate investments and lessen import dependency.
The energy sector was at the heart of his agenda when the President took over office a year ago.
According to Tinubu “Power generation should nearly double and transmission and distribution networks improved. We will encourage states to develop local sources as well.”
Nigeria is endowed with large oil, gas, hydro and solar resources, and it has the potential to generate 12,522 MW of electric power from existing plants. On most days, however, it is only able to dispatch around 4,000 MW, which is insufficient for a country of over 200 million people.
UnderKyari’s transformative leadership of the Group Chief Executive of the Nigerian National Petroleum Company Limited, the company conceived the idea of monetising Nigeria’s huge gas resources through independent power projects.
For a man who has transformed the NNPCL within the last four years despite the mounting opposition to some of his reforms initiatives, it is gratifying to know that the President believes in his capacity to implement energy policies that will enable the federal government to monetize all available oil and gas resources of today while paving the way for the total exploitation of new and cleaner energy sources of tomorrow.
To demonstrate this commitment to transforming the Nigeria’s power sector, the NNPCL, spearheaded by Kyari entered into a turnkey Engineering, Procurement and Construction (EPC) contract with China Machinery Engineering Corporation (CMEC) to construct the Gwagwalada Independent Power Plant project.
The project which was flagged-off in August by President Bola Tinubu has been described as a game-changer in Nigeria’s power sector.
It is a 1,350MW Combined Cycle Power Plant with auxiliaries and Balance of Plant to be situated on 547 hectares of land already acquired at Gwagwalada, in the Federal Capital Territory (FCT), Abuja.
The project is expected to generate between $700m and $800m annually within the first ten years of operations.
The GIPP was necessitated by the need for delivering gas towards additional power generation capacity in Nigeria. Under the plan, gas supply to the Plant will be through the Ajaokuta- Kaduna-Kano (AKK) Gas Pipeline Project which is currently at its advanced stages of construction.
The GIPP’s fuel requirements will be satisfied under a long-term Gas Sales, Purchase and Aggregation Agreement with Shell Petroleum Development Company Joint Venture (SPDC JV).
The GIPP project consists up of three power train blocks of 450MW each. Each block will include two General Electric (GE) gas turbine generators, two heat recovery steam generators (HRSG), one steam turbine electric generator, one direct air-cooling condenser, balance of plant equipment and a black start diesel generator.
On completion, the GIPP Project will generate an average of 10.3 million Megawatt hour (MWh) of electricity per year for sale to the Nigerian Bulk Electricity Trading Plc (NBET).
The sales of the generated power will be through Power Purchase Agreement (PPA) with the NBET to distribution companies (Discos) under long-term agreements. and direct sale to major off-takers.
Before the GIPP, the NNPCL had commissioned a 50mw Maiduguri Emergency Power plant (MEPP), which is a power generation project aimed at providing reliable and sustainable electricity to the city of Maiduguri, the capital of Borno State, and its environs.
The project was necessitated by the extended power outages experienced in the region in the last nine years. These outages, caused by vandalism and insurgency attacks on power supply infrastructure, had resulted in a decline in economic activities in the region.
The power generation project, aside from providing reliable and sustainable electricity to the city of Maiduguri, and its environs will also be a significant addition to the many initiatives aimed at ensuring domestic gas utilisation.
Under Kyari’s leadership, the NNPC has invested heavily in domestic gas footprint expansion projects through the delivery of the trans-Nigerian gas pipeline projects which includes the escravos project, the Lagos pipelines system, and the Ajaokuta-Kano Gas Pipelines.
As a national oil company, the NNPC is cooperating with its partners to solve the energy challenges facing the country.
The footprints of Kyari in the oil and gas sector was also felt when he led the NNPCL to secure a $7bn fresh investments from India for Nigeria’s petrochemical industry.
Kyari had accompanied President Bola Tinubu to India were the deal was announced
Tinubu had departed Abuja, Nigeria’s capital, for the G20 summit which was held from September 9 to 10 last year in New Delhi, the Indian capital.
The President’s visit to India was focused on attracting investments to Nigeria with lucrative opportunities for investors, but most importantly, jobs for Nigerians and new revenue opportunities for the country.
India is one of the growing markets for Nigeria’s Liquified Natural Gas and through this deal, the government will be able to create job opportunities for Nigerians.
Indian businesses serve as significant investments source in the midstream, downstream and upstream sectors of the oil and gas industry.
In the area of gas infrastructure, Kyari is also leading the NNPC to implement the AKK Gas Pipeline contract.
The AKK Gas Pipeline is an integral part of the Trans-Nigeria Gas Pipeline (TNGP) with a capacity to transport about 2.2 billion cubic feet of gas per day.
The NNPC Ltd had announced that the project’s completion date is now December 2024.
The project, when completed, is expected to ease natural gas transportation from Ajaokuta in Kogi State to Kano through several states.
In demonstration of his support to the agenda of the President, Kyari had, shortly after the removal of fuel subsidy and in line with the directive of Tinubu to provide alternative fuel option, led the NNPCL to enter into partnership with NIPCO Gas Limited to develop Compressed Natural Gas stations across the country.
The move is part of the NNPCL’s commitment to reducing carbon footprint and providing cheaper alternative fuel to motorists.
The current initiative is in addition to the phased deployment of 56 CNG stations planned by NNPC Retail across the country.
This landmark collaboration aims to expand the country’s CNG infrastructure, improve access to CNG, and accelerate the adoption of cheaper and cleaner alternative fuel for buses, cars and Keke NAPEP.
This will significantly reduce the cost of transportation and engender sustainable national economic growth.
Under the NNPC-NIPCO strategic partnership, 35 state-of-the-art CNG stations will be constructed nationwide, including three Mother stations.
Once fully operational, the stations can service over 200,000 vehicles daily, thereby significantly reducing carbon emissions and associated impact on climate.
At the height of the foreign exchange liquidity challenges faced by Nigeria last year, Kyari led the NNPCL to secure a $3bn facility from Afreximbank to enable the Federal Government to stabilize the foreign exchange market and boost the value of the naira against the dollar.
The $3bn emergency loan from the Bank was to ease pressure on the naira. The deal provided the Federal Government with dollars to aid liquidity to stabilise the naira via incremental releases based on the government’s needs.
The funds for the loan were released in tranches based on the specific needs and requirements of the federal government.
One can go on and on to highlight the remarkable impact Kyari’s leadership has brought to Nigeria’s oil and gas sector which appeared to be well known to the president, and which is probably responsible for the president’s seeming confidence in Kyari’s leadership of the NNPCL.
Onuba, a chartered accountant writes from Abuja