Top 3 Presidential Candidates in Nigeria Have These Plans for the Oil, Gas, and Power Sectors

By Omono Okonkwo

The Independent National Electoral Commission (INEC) has said that 93,469,008 Nigerians are registered for the upcoming general elections in February 2023. Those who pick up their permanent voters cards (PVCs) will have the chance to vote for a new president to take over from Muhammadu Buhari.

Currently, Atiku Abubakar of the People’s Democratic Party (PDP), Peter Obi of the Labour Party, and Bola Ahmed Tinubu of the All-Progressives Congress (APC) are currently dominating the political space.

A look at their manifestos shows that the oil, gas, and power sectors are high on the priority list of these candidates. Here are some of the promises the top three candidates have pledged to do in these sectors: 

Availability of fuel, gas, and other petroleum products 

Peter Obi plans to review and enforce the mandatory National Strategic Reserve of premium motor spirit (PMS), diesel (AGO), aviation fuel, and cooking gas to reduce the country’s national vulnerability to sudden disruptions to the supply of these petroleum products.

Atiku Abubakar wants to create a dynamic oil and gas sector that is fully integrated into the economy through linkages with agriculture, manufacturing, and micro small, and medium enterprises (MSMEs).  

Fuel subsidy removal 

Tinubu plans to phase out the fuel subsidy yet maintain the underlying social contract between the government and the people by dedicating the money that would have been used on the subsidy to fund targeted infrastructural, agricultural, and social welfare programs ranging from road construction to boreholes, public transportation subsidies, education, and healthcare funding programs.  

Peter Obi wants to eliminate the petrol subsidy regime, which has become a huge burden on the budget. He also plans to incentivize the mid-stream segment of the petroleum sector by facilitating gas processing plants and privately-owned small and medium-scale boutique refineries, with a view to reducing the importation of refined petroleum products. 

Oil production/refining capacity 

Nigeria currently produces 1.2 million barrels per day of crude oil, meanwhile, the country’s current local refining capacity is zero to none. Atiku Abubakar of the PDP plans to increase oil refining capacity to 2 million barrels per day by 2027 through the development of modular refineries all over the country.  

Atiku also plans to deploy modern technology in pipeline surveillance and other security enhancements as well as intensify engagement with local communities in the oil production zones. He also wants to encourage transparency and accountability in the operation of NNPC Limited and associated enterprises. 

Meanwhile, Bola Tinubu of the APC wants to increase oil production to 2.6 million barrels per day by 2027 and 4 million barrels per day by 2030 by deterring crude oil theft and preventing vandalism of pipelines, crude infrastructure, and assets. 

Although Peter Obi of the Labour Party does not outline a target for increased oil production, he wants to deter perpetrators from engaging in crude oil theft which has undermined crude oil production. Obi wants to support modular refineries priced in Naira.  

Obi also plans to preserve the country’s environmental integrity, using a carrot-and-stick approach to ensure that industrial production and oil production do not damage the environment and livelihood systems.  

Elimination of estimated billing 

Bola Tinubu plans to streamline and accelerate the National Mass Metering Programme and the Meter Asset Provider Scheme to ensure that all electrical connections are properly metered within the shortest possible time frame. New connections will not be permitted to be energized from the grid unless a meter has been installed. Distribution companies (DisCos) will be required to ensure that new connections are metered during the construction phase.  

Meanwhile, Peter Obi plans to put an end to estimated billing which is an untenable and opaque way to measure and sell energy to consumers. Obi will take action steps to complete the National Mass Metering Program (NMMP) and will require DisCos to replace all damaged and obsolete meters under the NMMP, in strict compliance with the Metering Code and other extant regulations by the end of 2023. 

Increased power supply 

All top three candidates have their own plans on how to approach Nigeria’s power supply deficit. Peter Obi wants to complete the 2019 Siemens power deal with renewed deadlines. Peter Obi plans to successfully complete the $2.3b Nigeria-Siemens network improvement deal (technical upgrade and strengthening) to achieve 7,000MW stable capacity by 2023, 11,000 megawatts by 2024, and 25,000 megawatts by 2025. He also wants to enhance the technical availability of the transmission network, and grid stability through “bankable” performance contracts. 

Meanwhile, Tinubu plans to implement further reforms to enable sufficient on-grid generation, transmission, and distribution to power the country. He also plans to undertake off-grid and renewable power generation options and solutions in collaboration with private sector participants as well as provide access to low-cost finance for power projects.  

Tinubu also says he will streamline and relax regulations to enable the private sector, and local and state government actors to electrify rural Nigeria in a safe and secure manner with reasonable tariffs. 

Atiku plans a 10,000 to 25,000 megawatts (MW) capacity over time, targeting a capacity mix of non-renewable energy (hydro, solar, nuclear) and other thermal fuels (coal, biofuel) in addition to natural gas. He also plans to promote the gas-to-power sector and gas industry linkages and open up the power sector from generation to transmission for private investments. 

Clean energy 

Renewable energy technologies adoption has been on the rise in Nigeria, it just makes sense that the top presidential candidates have some plans for the sector.

Tinubu wants Nigeria will stay committed to carbon neutrality by 2060. He also wants to provide the enabling environment, institutional, legislative and regulatory reforms required to attract foreign and domestic private sector investors, as well as support from donor agencies.   

Meanwhile, Peter Obi plans to launch a solar power revolution across Northern Nigeria, with a view of ensuring that all cities and industrial parks in Northern Nigeria have uninterrupted power by the end of 2024 by urgently re-engaging the 14 Independent Power Producers (IPPs), who had in 2016, initialed PPAs worth $2.5 billion to build a total 1,125 megawatts of installed solar capacity for delivery to the national grid, by removing the main structural impediments to reaching financial closure. 

Obi also has the following plans for clean energy: 

  • Invite experienced local and international developers to sign new power purchase agreements (PPAs) for 8,000MW of solar and wind plants, including offshore wind farms in the Lagos, Warri, and Port-Harcourt coastal areas with a mandatory latest commercial operation date of December 2025. 
  • Within 3 years, each of the southern states will develop and construct embedded power plants of capacities ranging from 5MW to 30MW up to a total of 300MW per state from locally-sourced gas in and around the states. This can be achieved quickly by locating the power plants close to natural gas lines that traverse the states. 
  • Complete and commission the Mambila hydroelectric power (HEP) project, which is planned to deliver 3,050MW; the Kashimbila Dam project, planned to deliver 40MW; and the 40MW Dadinkowa HEP plant. 
  • Develop 100,000 mini-grids across the country by the end of 2024 which will provide reliable power supply for up to 750,000 rural SMEs; provide uninterrupted power supply in all federal universities and university teaching hospitals; support the private sector to deploy 15 million solar standalone systems for residential and SMEs use by end of 2025; deliver on the government’s climate change obligations under the Paris Agreement, with respect to promoting renewable and reducing carbon emissions. 
  • Support the current efforts by the Nigerian Nuclear Regulatory Agency to procure build, operate, own, and transfer (BOOT) contracts for top international nuclear companies to construct nuclear power plants to generate 4,000 MW of electricity at acceptable PPA terms over 40 years. 
  • Establish a Green Army tasked with identifying all opportunities to tap into the $3 trillion international climate finance to engineer economic growth and employment for millions of our youths and transition our country to the green epoch. 

Energy investments 

Atiku Abubakar plans to give private investors a larger role in funding and managing the oil, gas, and power sectors. He also wants to privatize all government-owned refineries and issue new licenses for greenfield investment in crude oil refining.  

Bola Tinubu wants to strengthen partnerships with key producers in order to modernize the country’s oil infrastructure. Tinubu’s manifesto cites Saudi Aramco’s Tera Powers Reservoir modeling platform, which could aid the industry in finding additional oil and gas deposits. Saudi Aramco’s master gas system has been successful in establishing low-cost and clean fuel gas.  

Meanwhile, Obi plans to establish public-private partnerships and entrepreneurial public sector governance for the efficiency of the Nigerian Electricity Supply Industry (NESI) and pipelines network. He also wants to cut technical and commercial losses as well as bottlenecks across the value chain, to deliver adequate, accessible, reliable, and affordable power for Nigerians. 

Natural gas sector plans  

It is no longer news that the Buhari administration has initiated the National Gas Expansion Program (NGEP), targeted at gas for automobiles, cooking, captive power supply, and industrialization. This is because Nigeria is a gas-rich country and is in need of revenues.

Peter Obi plans to release gas assets to provide power for the nation and fast-track the Nigerian Gas Flare Commercialization Programme (NGFCP). He also plans to enact policies and measures to enable embedded power generation to access pipeline gas where available at input pricing to equal the current gas-to-power price plus transportation of $2.50 + 80cents, or some more affordable pricing, as opposed to the current $7.00 – $8.00 per million standard cubic feet (mscf). 

Meanwhile, Tinubu wants to achieve full deregulation of midstream gas prices within 6 months, increase gas production by 20% and complete critical gas infrastructure projects by 2027. Tinubu also plans to accelerate the implementation of the Nigeria Gas Master Plan and fully develop and modernize the regulatory framework for natural gas production. His plan also involves enforcing gas flaring penalties, and at the same time, offering tax credits or similar incentives to companies that achieve reasonable flare reduction targets. 

Market reforms 

Atiku Abubakar states his plan to break government monopoly in the country’s refineries, rail transportation, and power transmission, and intensify engagement with local communities in the oil production zones. Atiku also wants to allow the market greater leverage in determining oil, gas, and electricity prices, to eliminate the persistent price distortions caused by interventionist exchange rate management policy.  

Bola Tinubu plans to work with the National Assembly to review the Electric Power Sector Reform Act of 2005 and reform the regulatory and governance structure of our nation’s power sector. He also wants to expand the existing regime for off-grid power generation and explore new ways to exploit clean coal, solar, hydro, and other sustainable energy technologies, following international best practices.  

Peter Obi, on the other hand, wants to reform and restructure MDAs across the power sector value chain to achieve optimum delivery on set targets, create jobs, and enhance capacity, local manufacturing, and knowledge base.  

Obi also wants to implement adequate financing mechanisms and ensure cost-reflective tariffs for the power sector, while maintaining stable and delivery-oriented power distribution companies.

Obi maintains that power distribution companies (DisCos) investors will need to demonstrate the adequate capacity to improve their network, improve quality of service and customer satisfaction as well as demonstrate the adequate capacity to continue to operate their franchises satisfactorily, including investments in technology, human capacity, and customer offerings. 

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