The Nigeria Midstream and Downstream Petroleum Regu;atory Authority Authority (NMDPRA)has enumerated steps it is taking to enhance a smooth ‘Energy Transition’ that would not cause any unintended consequences for the Midstream and Downstream sector of the petroleum industry.
According to Farouk Ahmed, the Authority’s chief executive officer who spoke at the ongoing Oil Trading and Logistics (OTL) Africa Week 2022, in Lagos, he said, the NMDPRA is enhancing the regulatory environment in the sector in the following ways to ensure the midstream and downstream sector in Nigerian is strengthened and positioned properly in this era of energy transition
The NMDPRA boss who spoke on “Regulating Downstream Energy Transition in Dynamic Times” said that to reposition the sector in this season of opportunity, “we must be guided by a few pertinent drivers, which can be established from answering the following fundamental market related questions:
1. How do we provide for more “cheap clean/green” energy, within the increased drive for a global decarbonized economic
development?
2. How must innovative technologies for supply of “cheap
clean/green energy” be mainstreamed in the African energy
markets?
3. How must regulation be optimally integrated in the race for
sustainable energy supply in a manner that responsibly enables
businesses / investments .
He said in line with its primary mandates and objectives, NMDPRA is enhancing the regulatory environment in this sector in the following ways to ensure the midstream and downstream sector in Nigerian is strengthened and positioned properly in this era of energy transition.
“In accordance with the Nigeria’s aspirations for the decade of gas, NMDPRA is supporting the accelerated development of all key initiatives and projects that will guarantee optimal supply of gas from the abundant natural gas resource of Nigeria Working with key stakeholders to unlock the huge demand opportunities for use of gas in transforming the economic fortunes of the Country.”
“Leveraging on the provisions of the PIA that would spur gas
development. This would include concessionary royalties on
domestic gas supply, concessionary tax regime for domestic
gas infrastructure and co-financing of strategic gas investments.
Developing an investor friendly economic model for the
domestic gas market
Promoting the use of LPG as a cleaner cooking fuel alternative
to biomass.”
He said NMDPRA will be at the forefront of supporting
programs that prioritize LPG adoption for cleaner cooking fuels
and technologies to support Nigeria’s objectives of achieving
universal access to affordable, sustainable, and modern
energy by 2030 in line with UN Sustainable Development Goal
No. 7 (UN SGD-7).
According to him, recent research has demonstrated that
transition to LPG for clean cooking reduces air pollutants and
overall global temperature reduction by year 2040.
“Furthermore, we are fully aligned with our upstream sector
counterpart (NUPRC) in delivering optimal regulatory service
and driving the use of gas through the Nigerian Gas Flare
Commercialization Program
The Authority’s CEO said in accelerating full implementation of key provisions of PIA 2021, the NMDPRA Plans to emplace a functional governance system for the regulatory
administration of the midstream and downstream sector,
to developed twelve (12) new regulations for the midstream and
downstream and finalizing the process of their issuance /
gazetting. Other relevant regulations are also at different stages of development.
He said his organization is strengthening the domestic gas market for enhanced performance through emplacement of new regulatory regimes for wholesale gas supply, domestic gas market aggregation and open access.
It is also reviewing pricing models for all Petroleum Products in the downstream supply chain
He stated further that the Authority is addressing the issue of fuel quality through strategic collaboration with key stakeholders in the petroleum products value chain such as Netherland Human Environment and Transport Inspectorate (ILT), the NNPC Limited, Standards Organisation of Nigeria (SON) and the Nigeria Customs Service (NCS).
“Of particular importance is our strategic engagement with our Netherlands and Belgian Counterparts, considering that bulk of Nigeria’s petroleum products importation originates from the ARA region.”
4. Our collaboration with the Nigerian Customs Services led to the suspension of Import Licenses for land border importation of
Petroleum Products in order to eliminate sharp practices and
enhance quality control.
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5. Further collaborations with NNPC Limited, SON, NCS, ARDA, Nigerian Society of Chemical Engineers (NSChE) and other key stakeholders on improving the standards of fuel utilized in Nigeria will continue.
6. We shall also continue sustaining deep Collaboration with regional governments, regulatory entities, National Oil Companies and professional associations to improve fuel quality standards and implement the AFRI Clean Fuels roadmap.
Also speaking at the conference Mustapha Abdul-Hamid
CEO of National Petroleum Authority (NPA) Ghana said government regulations play a vital role in ensuring that we implement a just transition where there are no drastic job losses and there are no stranded oil and gas assets on the continent.
Regulations and incentives lead to greater innovation, and in turn, this allows companies to commercialise oil and gas assets. We must therefore steer our countries towards low carbon economies and net zero energy sector but prioritize economic growth and development in the process.
In his remark, Tunji Oyebanji, Chairman Advisory Board
OTL Africa Downstream Week said the organization has remained active over the years, despite strong industry headwinds that have seen some organisations scale down participation.
“But we have remained creative, bullish and consistent in leading advocacy for industry and maintaining a strong platform for individuals, brands and the industry as a whole to promote business, policy and operations.
He said this has attracted new collaborations, more strategic engagement and a wider acceptance of the OTL brand as the centre piece and melting pot for all things downstream, repositioning it for the long-term future.