Oando is set to increase gas production by 20 million cubic feet with the construction of three gas-compression plants in Aba, Abia State; Port Harcourt, Rivers State and a third to be located in central Nigeria worth about $36 million (N7.2 billion).
In an interview in Lagos, Bolaji Osunsanya, chief executive officer, Oando gas and power, said with domestic gas demand projected to reach 5 billion cubic feet daily in the next two years, Oando is targeting big energy users such as cement and steel plants, who currently rely on diesel to generate at least 1.5 megawatts of power per factory, to switch to gas.
Osunsanya noted that compressed to become more than 200 times smaller than its original volume, gas could be delivered to companies connected to pipelines during supply disruptions.
He further said that the company is building a business to truck natural gas to industrial users whenever they are cut off from pipeline supply. “We’re basically creating a market for the future, markets that otherwise you won’t have been able to use pipelines to serve. Today, it is possible to truck compressed natural gas there. The technology can be utilised on all modes of transportation. Today it is trucks, but there is a future for rail and for barges, so we can wheel compressed natural gas through the rivers upstream,” he said.
Another subsidiary, Oando Energy Resources, OER, a couple of weeks back expressed optimism of meeting its medium-term new production targets of 100,000 barrels of oil equivalent per day (boepd) and reserves of 500 million barrels of oil equivalent (MMboe) by 2017.
OER, said such high expectations is being driven by its reserves, exploration drive and vision of becoming a leading exploration and production player in the Nigerian oil and gas sector.
The company further said that it is well on track to meeting these production targets with its recent announcement of an 82 percent increase in reserves despite the downturn in the sector. The company’s proved and probable net reserves, 2P reserves were significantly increased from 230.6 million barrels of oil equivalent, MMboe to 420.3 MMboe at an economic value of $545 million to $1.8 billion.