FG loses N470m daily in Escravos pipeline attack

 

The attack last weekend on the Nigeria Gas Company’s (NGC) pipeline connected to Chevron Nigeria Limited’s facility at Escravos has been estimated to cost the nation about N470 million daily.

The attack which disrupted gas flow on the pipeline caused damage to the Olorunsogo NIPP plant with 600MW generating capacity, among other power plants.

The Federal Ministry of Power and the NGC disclosed this to the media in Abuja yesterday.

The destroyed gas pipeline supplies gas to the Escravos-Lagos Pipeline System (ELPS) and its vandalism led to a loss of 160mmsfcd of gas daily. At a cost of $2.50 per thousand scf, this loss amounts to $400,000 loss to the country everyday or N78.8 million daily in gas volume, the authorities lamented.

However, in order to arrest the situation and stop further losses, the NNPC is setting up a committee with the Police, JTF, that includes the Army, Air Force and Navy, as well as  community vigilante groups charged with the task of securing the pipelines.

The authorities indicated that this estimated loss is not inclusive of those incurred daily from affected power generation “in the sum of $1.9 million or N391.6 million daily. The total daily loss to the country is therefore estimated at N470.4 million. Repairs of the damaged pipelines would cost $609,137 or N120 million.”

The agencies also lamented that: “The real sector of the economy has also been counting its losses as some cement companies around Olorunsogo like Ewekoro and Ibese are also affected.

“The latest incident occurred as the Federal Government through the Ministry of Power, Works and Housing and the Ministry of Petroleum Resources along with other agencies were making concerted efforts to improve gas supplies to the power plants. Such efforts led to previously offline plants like Ihovbor and Sapele coming back online and the subsequent output making up for the loss in power. The pipelines are actively monitored for further attacks or other unforeseen impacts.

Between December 2014 to February 2015, six incidences of vandalism which affected the Trans Forcados Pipeline (at Oben, Sapele, Oredo) and Escravos Lagos Pipeline System (CNL) were recorded and they led to a loss of 1,100 mmscfd. According to industry experts, a loss of 200 mmscd is equivalent to power reduction of 700mw.

“While the industry is currently generating about 4120mwh/h on average as at last week data, it is without doubt that performance would have been better without the additional setback caused by the weekend’s Incident.

During the monthly meeting of the Minister of Power, Works and Housing, Mr. Babatunde Fashola with operators in the power sector last week, the NGC, NNPC and the GACN led by the Minister of State of Petroleum, Dr. Ibe Kachikwu shared information on significant gas projects that would improve gas supply scheduled for completion in the second quarter of 2016.