Ademiluyi: Nigeria Should Boost LPG Production from Marginal Oil Fields

The Chairman Autogas committee of Nigeria LPG Association, Bambo Ademiluyi has called on government to enhance the production of Liquefied Petroleum Gas (LPG) by tapping into marginal oil fields.

In an interview with ARISE NEWS on Thursday, Ademiluyi emphasised the importance of capturing and utilising all gas resources from these fields, suggesting that a portion of the funds earmarked for gas development should be allocated to these marginal oil operations to facilitate gas extraction.

“Government should encourage more production of LPG through the marginal oil fields. Make sure that every marginal oil field captures all its gas and is ready to produce. Part of the funds that they have for gas development, should be given to these marginal oil fields to get their gas out. CNG is more volatile, more expensive to deploy and difficult to get it to use.

“This CNG that we are talking about in my opinion, should be channelled towards power generation and industrialization. If we have captive power all over, fired by CNG, propane and all, we can use electric vehicles because electric vehicles need regular power. So, if there is power, electric vehicles are very good. 

“Following up on gas use, CNG in my own opinion should be more used for power generation. If we get our technology right, we will have enough gas to use.”  

He also called for a reassessment of Nigeria’s energy strategy, citing significant challenges in the deployment of Compressed Natural Gas (CNG) infrastructure and advocating for a more diversified approach to fuel sources.

“They have not kept their promise but I will not say they are deceiving us. They probably made that promise and found out that the obstacles that stand between them and the promise were not what they expected. 

“This is because when they made that announcement, we knew that it would be difficult because CNG is not available all over. You cannot make it available all over. If it was available all over like the LPG, you can achieve that. 

“Unfortunately, LPG is more expensive than the CNG, although it is more available. There is no local government you will go to that you will not find LPG. So, the problem is availability all over. You find out that the states that are talking about CNG are states that have access to pipelines and all that.

“To deploy a CNG station, we will need about 150,000 to 200,000 dollars and that for most marketers is not viable. So, if i am going to spend that amount for CNG, i have to find a way to make the money back in two or three years. 

“If you deploy an LPG station that is going to do the same thing, you can make your money back in two years or three and you will be spending for a mini station, 30 million to 40 million naira and you can make your money back. So, cost of deployment is a major problem for CNG and will be something the government has to look at. That is why we are saying, look at other sources of fuel.”

He further called for the adoption of modular refineries to enhance Nigeria’s oil production, highlighting the ingenuity of local crude oil producers operating in the creeks and criticising the Nigerian preference for large-scale projects.

“I have been talking about modular refineries for more than 25 years. All those guys that are producing crude in the creeks, if they are producing with bamboo and drums, that means they have something up their heads. but we go and start killing and shooting them. 

“Yes, they are bursting pipelines which is not good, but give them crude officially and give them a space and they will produce and we have them scattered all over. But we like grandeur and big projects in Nigeria and that is what is killing us.”

Chioma Kalu

Follow us on: