Nigeria to Establish Gas Processing, Marketing Board

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Nigeria’s Federal House of Representatives has given approval to a bill seeking to establish a gas processing and marketing regulatory board.

The approved bill is to empower the “Board” to monitor operational regulations and management of strategic gas pipelines and supply networks; formulate and implement all policies aimed at ensuring safety and security of gas processing, transportation, distribution, and formulate policies that would enhance the distribution and utilisation of gas for domestic and industrial purposes.

The bill will also regulate the prices charged for downstream gas, distribution, supply and sale of gas to importers; granting domestic downstream licences for construction and operation of processing plants for gas liquefaction; undertake supply of natural gas and owning and running natural gas processing and retail facilities.

According to the proponent of the bill, Agbedi Frederick, the Board when established, will ensure gainful harvest of enormous gas resources, as gas is the new world economic direction in the petroleum/energy industry.

Frederick noted that the regulatory agency when created would be responsible for the supervision and control of the downstream activities of gas marketing and utilisation, would provide Nigeria with maximum benefits from the evolving gas sub-sector of the Nigerian economy.

He said; “Effective gas development is a string catalysts for economic growth, which promises a multiplier effect on the Nigerian economy. As Nigeria is entering into the gas era, the need for a clear legal framework to guide gas exploration, exploitation and utilisation becomes abundantly prominent and that is the basis for the bill under consideration.

“Before this time, gas had been considered a wasteful by-product in petroleum exploration and exploitation that had to be flares. Recently gas has come to be recognised as a valuable product that can be exploited alone or together with crude oil.

“Even with the recognition and the anticipated earnings from gas, enough consideration has not been given in all existing petroleum industry legislation. Even in the petroleum industry bill that has been proposed to the House in which one of the objectives is to create efficient and effective governing institutions with clear and separate roles for the petroleum industry, no institution was created for the management and control of the exploitation and utilisation of gas resources. Rather, it was sparingly included in the functions of the Nigerian Petroleum Regulatory Commission.”

He noted that there have been increasing utilisation of gas in motor engines, generation of power, industries and domestically, that Nigeria would soon rely more on gas for cooking and other domestic heating activities.

Also, Diri Douye, who decried the level of environmental degradation of the oil producing communities across the Niger Delta, emphasise the need to provide legal framework that would regulate gas exploration in the country.

While contributing, Hon. Henry Archibong expressed optimism that gas resources had huge potential of crude oil, just as he stressed the need for the amendment of the existing Act on associated gas with the view to address the challenges of gas flaring, which contributed to loss of huge foreign exchange.

Contributing, Hon. Leo Ogor, minority leader, who expressed regrets over Nigeria’s failure to add value to its crude oil exported for over 60 years, assured that the legal framework would address so many challenges in the gas industry.

In his ruling, Speaker, Hon. Yakubu Dogara referred the bill to the House Committee on Gas Resources for further legislative action.

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