State of the Nation (Power)

I'm not an expert on the power industry, but having had electrical engineering, Oil & Gas industry & financial training, I can opine.

There are technical, financial/commercial & regulatory impediments to our goal of generating sufficient electricity.

Regulatory impediments impact on everything, but take a close look at our National Assembly, will they put national interest about personal?

I will do a series on the power industry value chain. It starts from gas exploration, then moves to generation & finally distribution.

The most difficult impediments to remove are the regulatory impediments. They are closely linked with our political economy.

Nigeria is swimming with gas, but gas field development is a complex and expensive endeavor.

Extracting crude from the ground is relatively easy, if you understand secondary school level physics & chemistry, you can understand it.

Crude oil extraction is mainly overbalanced drilling, passed on to a separator, gas is flared, moves to flow station, then export terminal.

Natural gas engineering is a more complex, & regulation means investors prefer to invest in crude field development & simply flare the gas.

If you study the power value chain, the question you'd ask is "where is the  clear line of sight between investment & profits"?

Telecommunications (especially GSM) was relatively straightforward. Power is NOT "the new Telecommunications", it is more complex

I haven't gone into other aspects like generation, transmission & distribution. But should the price of an SCF of gas be regulated?

If the price of an SCF of gas is regulated, how profitable will gas field development for internal use (opposed to export) be?

What tariff/tariff regime will make investment in distribution/transmission worthwhile? Should this be revisited?

One thing I know about our politicians is this; they are not Margaret Thatcher, they simply don't do the hard intellectual work required.