Abstract
Since the late 1960s, the Government of Nigeria has sought both to exploit the country’s natural gas resources and to reduce the environmental impact and economic cost of the gas that is associated with oil production. Key initiatives have included legislation prohibiting gas flaring and venting, the introduction of fiscal incentives for gas utilisation projects, the development of international and regional gas export markets, the promotion of the re-injection of gas in petroleum exploration and production processes, the use of natural gas in power generation and as an industrial feedstock and, more recently in 1997, the proposal to adopt compressed natural gas (CNG) as an automotive fuel. These efforts have yielded mixed results – ranging from the outright failure of legislation to abate gas flaring, as reported in Ogunlowo et al. (2015), to success in becoming a leading exporter of liquefied natural gas (LNG) (EIA, 2013) and as a supplier of piped natural gas to parts of West Africa (West African Gas Pipeline Company, 2012). In addition, the Nigerian National Petroleum Corporation (NNPC, 2016) indicated that around 12% of the associated gas encountered during exploration and production processes in 2016 was re-injected, compared to near zero in 1990. Onolemhemhen et al. (2017) observed that the domestic gas supply obligation introduced in 2008, which mandates oil and gas companies to make a portion of the gas they produce available to the local market, has further boosted national gas utilisation by over 40% between 2008 and 2017. The impact is especially in the power and industrial sectors – evidenced by 23 gas-powered plants, with another two under construction, improved utilisation of liquefied petroleum gas (LPG), and a resurgence in cement and fertiliser production. Yet, the adoption of CNG as a transportation fuel has been slow, despite the fact that the country continues to experience transportation energy shortages (Ezea, 2018). The country has a natural gas vehicle (NGV) penetration of just 0.1% – that is, 6000 NGVs out of a national fleet of more than six million vehicles (NGV Global, 2017).