The Nigerian National Petroleum Corporation (NNPC), has said that Nigeria’s effort at attracting investors into its gas utilisation drive and creating value for the economy is responsible for different gas prices in the domestic market.
Bello Rabiu, chief operating officer, NNPC Upstream, disclosed this at the just concluded annual conference and exhibition of the Society of Petroleum Engineers (SPE) in Lagos on Wednesday.
He explained there are different gas prices for various sectors of the economy, including power, which is different from that of industries and gas-based entities like fertilisers and petrochemicals.
“Investors in various sectors of the economy are encouraged to take advantage of these differentials.
“Part of the reason for the gas master plan is to make the domestic gas market viable and reduce entry barriers.
“As incentives, we have one gas price for power, another for industries, so that they can have cheaper energy.
“Also, there is a different price for gas-based industries such as fertilizers and petrochemicals. This is aimed at arriving at a willing buyer, willing seller model of pricing,” he said.
The NNPC chief, who did not specify the exact amount for the various categories of gas product, said the end goal was for Nigerian companies to compete favourably with companies that produce similar products around the world.
“In this sense a Nigerian fertiliser manufacturer should be able to compete with other fertilizer makers around the world.
“To ensure there is willing buyer, willing seller model in the domestic gas market, the NNPC decided five billion standard cubic feet of gas daily will be able to sustain supply and sufficiency of gas to the domestic market,” he said.
Jeffrey Ewing, the Managing Director, Chevron Nigeria Limited, said“gas is a big source of economic diversification which can transform agro based industries through the use of fertilizers.
“But to attract the needed investment, we need fiscal terms as incentives to investors.
“Some companies have supplied gas but have not been paid. We also need fiscal terms that encourages small and medium term projects