The idea of bringing Nigerian gas by pipeline across the Sahara to Europe is looking ever more attractive as Europe, whose gas requirements are set to rise, seeks to lessen its reliance on Moscow.
The European Union is “interested in the Trans-Saharan Gas Pipeline project,” Ferran Tarradellas Espuny, the European Commission’s spokesman for energy, told AFP.
“The number of suppliers is limited, and global demand is rising too, so the development of new infrastructures is important for Europe.”
Brussels is not about to forget any time soon how a big swathe of Europe was deprived of gas at the height of winter in January amid a supply dispute between Moscow and Kiev.
“Our gas demand is expected to grow by 1.7 percent a year, and domestic production is declining, so up to 85 percent of Europe’s gas may come from imports by 2030, as opposed to 50 percent in 2000,” Tarradellas Espuny added.
“Furthermore, since natural gas is a relatively clean technology, increasing its use for energy production is also in line with our battle against climate change.”
The Trans-Saharan Gas Pipeline (TSGP), which is currently still just a drawing on paper and whose cost is estimated at between 10 and 12 billion dollars (8-9 billion euros), will link the southern coast of Nigeria to northern Algeria, passing through Niger on the way. The gas will then transit to Europe under the Mediterranean.
A feasibility study indicated the pipeline, whose annual capacity will be between 0.71 trillion cubic feet and 1.06 trillion cubic feet (20 and 30 billion cubic metres), should be up and running by 2015-2017.
Industry sources tend to consider that timeframe over-optimistic and point out that gas infrastructure normally takes around 10 years for construction.
“The recent Russia-Ukraine gas crisis has definitely demonstrated the vulnerability of the EU in gas security,” Tarradellas Espuny said.
Nigeria’s gas reserves, estimated at 187 trillion cubic feet (5.29 trillion cubic metres), are the seventh largest in the world.
These reserves could prove to be much bigger, for until now there has been no real gas prospection. All the proven reserves so far have been discovered during exploration for oil, Emmanuel Egbogah, special adviser to President Umaru Yar’Adua on petroleum matters, said at a recent conference.
He quoted a US Geological Survey (USGS) study as estimating Nigeria’s reserves could be as high as 600 trillion cubic feet.
“It is… not unlikely that with focused gas exploration, the USGS estimate can be realised. This will easily put Nigeria in the league of the top four gas reserves holders in the world,” Egbogah said.
After a visit to Nigeria in September 2008 by the EU commissioner Andris Piebalgs, Egbogah travelled to Brussels in March to follow up on energy cooperation.
“There’s been significantly more interest (in the TSGP) in recent months, including (on the part of) some of the international companies operating in Nigeria,” junior Oil Minister Odein Ajumogobia told AFP.
Total Nigeria head Guy Maurice, speaking at the same conference as Egbogah, said the French group is ready to play a role in the TSGP, but said it is too early to talk numbers.
The head of Gazprom in Nigeria, Vladimir Ilyanin, at the same meeting, said the Russian company already has experience of running similar large-scale projects.
Despite its oil wealth Nigeria is woefully short of power. Its power stations, mostly powered by gas turbines, are highly erratic.
In view of this situation, some analysts question whether it makes sense to export gas elsewhere, when the country, whose needs are expected to rise, is short of the commodity itself.
Ajumogobia defended the pipeline project, saying that it will not only bring in revenue, but because of its route will also make it easier to supply gas to the north of the country.
The southern Niger Delta, where the gas will come from, is regularly the scene of violence carried out by armed groups targeting the oil sector. In late February one group said it was determined to sabotage the project as soon as it started.