Gas production in Nigeria has gained more momentum following the completion of a key project in the Niger Delta by the Shell Petroleum Development Company of Nigeria Limited Joint Venture.

The SPDC announced on Wednesday that production had commenced at Gbaran-Ubie Phase 2, which would help to boost gas supply to the domestic market and maintain supply to the export market.

Nigeria is Africa’s top oil producer and largest holder of natural gas reserves on the continent, with about 187 trillion cubic feet of proven gas reserves and 600 Tcf of unproven gas reserves. The country, which has the ninth largest gas reserves in the world, is only the 22nd largest producer of natural gas.

The Gbaran-Ubie Phase 2 followed the success of the first phase of the Gbaran-Ubie integrated oil and gas development, which was commissioned in June 2010.

Peak production at Gbaran-Ubie Phase 2 is expected in 2019 with approximately 175,000 barrels of oil equivalent per day, comprising about 864 million standard cubic feet of gas per day and 26,000 barrels of condensate per day, according to the SPDC.

“The latest development at Gbaran-Ubie is a powerful statement on the continuing commitment of the SPDC and our Joint Venture partners to harness Nigeria’s oil and gas resources for the benefit of the country and stakeholders,” the SPDC Managing Director and Country Chair, Shell Companies in Nigeria, Osagie Okunbor, said.

He said the project was delivered safely through an integrated team with a significant engagement and empowerment of community service providers and Nigerian companies.

According to a statement, eighteen wells have been drilled and a new pipeline constructed between Kolo Creek and Soku, which connects the existing Gbaran-Ubie Central Processing Facility to the Soku Non-Associated Gas plant.

It said first gas flowed from the wells in March 2016, with the facilities coming on stream in July 2017.

The Vice-President, Nigeria and Gabon, Shell, Peter Costello, said, “This is exciting news for Nigeria as it signals Shell’s continued strategy of deploying investment and expertise in our areas of strength.

“Our aim is to continue to explore areas of partnership in Nigeria where the right conditions exist and where we can add best value.”

Shell said the Gbaran-Ubie Phase 2 would help to process the condensate from Kolo Creek, Gbaran, Koroama and Epu fields, thereby assisting in reducing the volume of flaring from its operations, adding that the project had contributed to economic development in the Niger Delta and assisted the local community and Nigerian companies.

The oil major said during construction, members of the community and local sub-contractors provided goods and services in line with the provisions of a Global Memorandum of Understanding.

It said training was also provided to the community in pipeline maintenance, scaffolding, welding and piping fabrication.

The SPDC is the operator of the JV involving the Nigerian National Petroleum Corporation, SPDC, Total E&P Nigeria Limited and Eni subsidiary, the Nigerian Agip Oil Company Limited.

The Group Managing Director, NNPC, Dr. Maikanti Baru, had recently said that the corporation’s strategic plan for gas was to deliver five billion scfd to the domestic market by 2020, without losing focus on retaining and expanding the country’s share of the global market.

He said the recent drive by the Ministry of Petroleum Resources and the NNPC to create an enabling environment for growth of the domestic gas market could not be overemphasised.

He said based on a projected domestic gas supply deficit of three billion scfd, the corporation had identified seven critical gas development projects, which could be delivered in the short and medium term to bridge the impending gas supply shortfall.

Baru said, “So far, over 1000km of major gas pipelines have been laid and commissioned; an additional 470km is currently in construction phase while a further 1400km is intended for construction before the end of 2017.

“Also, along with the development of physical infrastructure, commercial frameworks are being put in place to support the growth of the domestic gas market. Progress has also been made in the reduction of flared gas volumes from a peak of 2.5bscfpd a couple of years ago to about a current volume of 700MMscfpd.”

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