TRANS-NIGERIA GAS PIPELINE: MAKING ECONOMIC DECISIONS BASED ON POLITICAL CONSIDERATIONS ALWAYS LEADS TO WASTE AND INEFFICIENCIES
Okenwa Nwosu
Lower Niger Congress
16th July 2020

Not many Nigerians are aware of the Trans-Nigeria Gas Pipeline, whose first phase was stopped at Ajaokuta, Kogi state ostensibly to serve the Russian-designed steel complex that had died in the womb decades earlier. The gas pipeline was supposed to be extended to Kaduna and Kano but was left uncompleted due to its nonviability. The trans-Nigerian segment is supposed to be the southern end of a Trans-Sahara Gas Pipeline that would link the plentiful natural gas reserves of Nigeria with the European market. This was a big dream that looked good on paper. But on a closer look, it possesses all the attributes of a pipedream. The industrialized West countries, which have been the top consumers of fossil fuel, have individually and collectively set up target dates for phasing out their reliance on carbon-based energy sources that, of course, include natural gas. It required no specialized knowhow to appreciate the fact that the notion of committing vast sums of funds to build a gas pipeline from Nigeria to the Mediterranean coast shall never see the light of day.

The initial investment made in building the Tans-Nigeria Gas Pipeline that stops at the abandoned Ajaokuta Steel has been lying idle despite the vast sums of hard cash borrowed for its construction. In this ongoing global economic slowdown when the export price for crude petroleum and natural gas has plummeted to dismal levels, the Buhari administration has seen it as a priority to borrow the sum of $2.8 billion from China to plow into the extension of the northern end of the nonfunctioning gas pipeline to nowhere. According to contract specifications, the pipeline dimensions for this Chinese contract is still based on the outdated design for a grandiose Trans-Sahara Gas Pipeline project that shall never be because of the current global trends.

Business Day correspondents smelt something fishy in all this and aptly raised the alarm. With all the economic woes that stare today’s Nigeria in the face, many would consider the expansion of the country’s debt burden by $2.8 billion to build a pipeline extension into the poorest part of Nigeria without an industrial client base that one can see as a manifestation of economic tomfoolery. Perhaps, the only justification for the AKK-Pipeline undertaking, at this juncture, is the political gratification of President Buhari’s primary constituents in the Arewa North. It should be recalled that similar federal contracts were once awarded in the past to the cronies of political leaders to build electric gas-turbine generators at locations that have no access to natural gas pipeline. These gas turbines, after construction, have since joined the long list of abandoned white-elephant projects that litter the Nigerian countryside.

Piping of Nigeria’s abundant natural gas from the South, where the resource can be more efficiently utilized, into the vast, impoverished expanses of the North with the assistance of a foreign loan is a reliable indicator that the minders of today’s Unitary Nigeria have indeed lost their minds and commonsense. Why in the world do Buhari and his advisers think that the best place to put $2.8 billion of borrowed money in today’s troubled Nigeria is to revisit a white elephant project that was abandoned at Ajaokuta for decades?

To read the Business Day article as republished, go to the LNC USA website homepage and scroll toward the bottom. Share widely with your social media contacts as usual.
Okenwa.


SOURCE:
https://web.facebook.com/lowernigercongress