NNPCL’s Pipeline Infrastructure Strategy
The Nigerian National Petroleum Company Limited (NNPCL) is formulating a plan to create a nationwide network of high-integrity crude oil and gas pipelines. This initiative aims to lower security costs. The company will invest heavily in technology to upgrade existing oil and gas transportation infrastructure to meet modern standards.
Upcoming Upgrades
At the 2024 Nigeria International Pipeline Technology and Security Conference (NIPITECS) in Abuja, NNPC’s Group CEO, Mele Kyari, discussed these upgrades. They will incorporate technologies such as fiber optics, geo-tagging, and radio frequency systems.
Importance of Pipelines
The conference, organized by the Pipelines Professionals Association of Nigeria (PLAN), had the theme: “Pipelines: Critical Assets for National Economic Development and Environmental Sustainability.” NNPC operates over 5,120 kilometers of pipelines across the country. These pipes are intended to transport crude oil to state-owned refineries and distribute refined products. However, many have suffered from vandalism, sabotage, and aging, with some in use for over sixty years.
Strategy for Reliability
Kyari, represented by NPSC Managing Director Folorunso Kareem, mentioned that NNPCL has eight pump stations to maintain flow rates and pressure. They also have 22 product depots and one crude oil terminal in Escravos. NPSC has initiated a program to improve pipeline reliability, including repairs and security maintenance contracts.
Since 2016, NNPC has partnered with a security firm to manage these aspects. Contractors are responsible for minor repairs and can face penalties for leakages over one percent. Current pipelines to Warri and Port Harcourt maintain leakage rates below this threshold.
Addressing Security Costs
Kyari pointed out that the current system incurs high security costs. However, the new pipeline network will address these challenges. The strategy includes constructing high-integrity, low-risk pipelines and using innovative engineering solutions, such as deep burial in high-risk areas and advanced monitoring technologies.
Funding will come from private investments through a Build Operate and Transfer (BOT) model. This will generate a return on investment via a throughput fee, which will exceed current security and loss costs. Kyari emphasized that pipelines are crucial for national economic growth and environmental sustainability. They are essential for safely transporting key resources, contributing to energy security and industrial development.
The Role of Government
Minister of State for Petroleum (Gas), Ekperikpe Ekpo, highlighted the importance of pipeline assets for economic growth and energy access in Nigeria. He noted the vulnerabilities these assets face from vandalism and theft, leading to revenue loss, environmental damage, and national security issues. The administration is committed to enhancing pipeline security through innovative technologies, improved protocols, and stronger stakeholder cooperation.
PLAN’s Commitment to Quality
Geoff Onuoha, Chairman of the Board of Trustees of PLAN, stated the organization aims to promote professionalism and best practices in the pipeline industry. PLAN will influence standards, funding, and regulations regarding pipelines in Nigeria. This will ensure visibility for pipeline issues and promote safe installation and operational practices.4o24Upgrade
