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NNPC plans to generate 4,000 MW of power from joint venture projects

20 Mar 2017, 06:35 pm
Financial Nigeria
NNPC plans to generate 4,000 MW of power from joint venture projects

News Highlight

- NNPC plans to achieve its power generation target by building independent power plants in the next three to ten years via joint ventures with international power companies and Nigerian investors.

Nigerian National Petroleum Corporation headquarters, Abuja

The Nigerian National Petroleum Corporation plans to generate about 4,000 megawatts of electricity in the next ten years to boost power supply in the country, Saidu Mohammed, NNPC’s Chief Operating Officer (Gas and Power), said in a statement released today.

Mohammed said the corporation plans to achieve its power generation target by building independent power plants in the next three to ten years via joint ventures with international power companies and Nigerian investors. The joint ventures would be structured after the Nigerian Liquefied Natural Gas (NLNG) business model, he said.

“Power generation is a big business,” Mohammed said. “As at today, NNPC has interest in two power plants, one in Okpai, Delta State, and the other in Afam, Rivers State, which were respectively built by our joint ventures with Agip and Shell. These two power plants collectively generate up to 1,000 megawatts and they are the most reliable and cheapest source of power to the national grid in Nigeria today.”

The NNPC executive said plans were underway to commence the development of Okpai Phase 2 Power Plant as well as other JV power plants such as Obite and Agura plants. These new power plants would require the extension of the NNPC’s gas pipeline infrastructure to connect various parts of the country.

“The main base-loads to justify such infrastructure are power plants that would consume the gas and for that, we are planning to build about 2,000 to 3,100 megawatts, combined, in these three cities,” Mohammed said. “The partnership will involve players who will bring in their various capacities as operators, builders of power plants and as investors. NNPC will also bring its strength of being a dominant player in the Nigerian gas value chain.”

Mohammed said that the NNPC, as a stakeholder in the gas value chain, had developed capabilities in processing, transportation, and marketing of gas for exports as well as domestic utilization. These capabilities could help to revitalize Nigeria’s moribund industries, he said.

“NNPC intends to capture 50 per cent of the gas market in Nigeria by growing the Nigerian Gas Marketing Company from the 500 million standard cubic feet/day of gas that it is today to about 3 to 4 billion standard cubic feet/day in the next 10 years,” he said.

According to Mohammed, the NNPC requires about $15 billion investment to realize its gas and power aspirations. He said the corporation is currently discussing with international investors to address Nigeria’s gas deficit by building on the already existing gas infrastructure.

“We are going to unbundle the upstream by delineating the midstream so as to allow other players operate in it while NNPC as the operator of the pipeline network will continue to deliver gas to the downstream sector and ultimate consumers,” he said.


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