Shell pledges more domestic gas supply, 600mmscfd coming

The Shell Petroleum Development Company Joint Venture (SPDC JV) has said it is committed to working with the Federal Government and the energy companies to increase gas supply to the domestic market while reducing flared gas volume.

The oil giant said it is developing new gas projects, which will boost domestic gas supply. It cited as example, the Assa North/Ohaji South project in Imo State, which is a joint development involving SPDC, the Nigerian National Petroleum Corporation (NNPC), Total, Agip, and Seplat Plc, a leading indigenous producer, to have the potential to be one of the largest domestic gas projects in the country.

SPDC is expected to supply 600 million standard cubic feet per day (mmscfd) of gas to two plants – a new SPDC JV processing plant and a new proposed Seplat processing plant. The combined volume translates to almost 2,400megawatts (mw) of potential electricity generation when it comes into fruition.

SPDC said it continues to make progress in close collaboration with its JV partners and the Federal Government towards the objective of ending continuous flaring of associated gas. Associated gas is found in association with oil within a reservoir.

According to Shell, since 2000, all new SPDC JV facilities have been designated to eliminate continuous flaring of associated gas. In parallel, a multi-year programme has been successfully implemented to install equipment for capturing associated gas from older facilities.

“As a result, flaring volume from SPDC JV facilities was reduced by 90 per cent between 2002 and 2017 and flaring intensity (flare divided by total hydrocarbon produced) decreased by 78 per cent over the same period.

“Divestments also resulted in a further reduction, however, flaring from SPDC JV’s operations in 2017 increased by 61 per cent compared to 2016 and flaring intensity also increased by 28 per cent from the previous year. The increase in 2017 is partly attributed to the restart of certain SPDC JV facilities, for example, Forcados export terminal that was offline for most of 2016.

“There are several SPDC JV facilities where flaring still take place. Some only have non-routine operational flaring such as Soku, Bonny, Gbaran-ubie and Agbada projects because they have fully functional solutions to address routine flaring.

“Others have routine flaring and the SPDC JV has identified solutions by capturing the associated gas and commercializsing it for the domestic market. For example, the Bonny Associated Gas Solutions(AGS) facility was commissioned in 2016, while Adibawaand Otumara/Saghara AGS projects came on stream in November and December of 2017 respectively.

“However, the planned start up dates for two gas gathering projects have historically been delayed due to lack of adequate joint venture funding. Nevertheless, with funding restored, the projects are planned for completion in 2018-2019. The remaining sites are located in remote areas with low volume flares.

“Since late 2016, the SPDC has been working with third parties to develop small scale projects to capture the associated gas from these remaining sites for domestic utilisation.The SPDC JV is currently in discussion with Federal Government to launch the Nigeria Flared Gas CommercialisationProgamme, which is expected to address these remaining sites,” the company said.

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