Africa, more specifically Nigeria, faces a transition. After a record high year for crude oil exports, studies show that the nonrenewable resource’s reserves are dwindling. As reporter Zainab Calcuttawala said, “Nigeria will run out of its prized oil reserves in the next 25 to 30 years, which means the country should shift its focus to natural gas production.” That’s not to say Nigerian exports are doomed. Instead, the country shifts focus to natural gas, a new resource with a plethora of revenue opportunities. Afterall, Nigeria sits on 188 trillion standard cubic feet of untapped gas reserves, the seventh most in the world and the largest in Africa.
This untapped promise isn’t necessarily a smooth transition, but few are. Given the ticking clock on crude oil exports, a powerful support to the local economy, Nigeria only has one option. The country needs to develop their gas industry to maintain the earnings.
Although, “Oil and gas experts believed that Nigeria could even earn more from full utilisation of gas resources than what it is currently been realised from crude oil exports,” there is also a host of problems. While the gas industry holds enormous promise for the country, the infrastructure, or lack thereof, currently stands in the way.
This also doesn’t account for vandals that have impeded efforts. The West African Gas Pipeline (WAGP) progressed the industry, but after suffering a series of damages, the WAGP has a gray cloud floating over it. The West African Gas Pipeline Company developed a damages prevention program, but it’s still not perfect. Since much of the pipeline is offshore in highly populated fishing areas, some damages are common but unintentional as a result of anchoring, bottom trawling and dragging anchor. As a result, the company developed a Pipeline Protection Zone that covers a nautical mile on each side of the pipeline and stretches across four countries so far. Adopting measures to improve the system is the first step in genuinely monetizing the reserves.
Looking Down the Road
None of this is to say that Nigeria is not producing. While the industry hasn’t reached its full potential, World Energy found that “Nigeria produced 43.8 bcm of natural gas in 2014, which only made them the world’s 19th largest producer of natural gas globally. However, this natural gas production represented a 6.6% growth compared to the previous year and Nigeria’s proved natural gas reserves illustrate that they have the opportunity to further grow production in the future.” The industry is on the rise. The momentum just needs to continue so that when the inevitable decline hits the economy, the gas industry is prepared to step in.