Stranded Gas Resource Development: Challenges, Opportunities AkaChidike Kanu

Gas Province ~185 Tcf proven reserves Enviable sweet gas resource base Unenviable resource flaring records Fast growing export market Comatose domestic gas market Domestic supply security issues Strategy in place – the Gas Master Plan

~185 Tcf proven reserves

Enviable sweet gas resource base

Unenviable resource flaring records

Fast growing export market

Comatose domestic gas market

Domestic supply security issues

Strategy in place – the Gas Master Plan

Econometrics ~40% of total reserves not available in the near-term (i.e considered stranded) Gas available in the near-term mainly NAG Short-term availability < Short term demand

~40% of total reserves not available in the near-term (i.e considered stranded)

Gas available in the near-term mainly NAG

Short-term availability < Short term demand

Define Stranded Gas Uneconomic for monetization Small volume reserves Gas caps Remote reserves AG reserves Impacts on macroeconomics

Uneconomic for monetization

Small volume reserves

Gas caps

Remote reserves

AG reserves

Impacts on macroeconomics

Stranded gas This Paper: Reviews techs & economic issues Highlights opportunities & Strategic focus items

This Paper:

Reviews techs & economic issues

Highlights opportunities &

Strategic focus items

Challenges Relatively low VIR i.e. uncompetitive Hi risk, lo return opportunity! Development economics & investment decision novel tech, downstream Risks bundled, disincentive Fiscal terms Market factors / demand Gas price Access, gathering, ops surveillance & intervention CAPEX, OPEX RSG Factor

Relatively low VIR i.e. uncompetitive

Hi risk, lo return opportunity!

Tech Concepts Distance - a main factor of concept selection Pipeline: principal near-market solution LNG: principal distant-market solution Recycling: alternative to flaring

Distance - a main factor of concept selection

Pipeline: principal near-market solution

LNG: principal distant-market solution

Recycling: alternative to flaring

Concepts / Opportunities P/L: large volumes over shorter distances LNG: large volumes for longer distances Challenges with major tech solutions

P/L: large volumes over shorter distances

LNG: large volumes for longer distances

Challenges with major tech solutions

Concepts/ Opportunities Tailored Concepts: CNG smaller gas volumes, shorter distances lo energy density, special carriers, unproven. Methanol wide prod value-chain, fits existing infrastructures metOH market/utility is still limited

Tailored Concepts:

CNG

smaller gas volumes, shorter distances

lo energy density, special carriers, unproven.

Methanol

wide prod value-chain, fits existing infrastructures

metOH market/utility is still limited

Concepts/ Opportunities FLNG smaller units, cheaper concepts, unproven, operational concerns. GTL (Diesel, synfuels, naphtha) cleaner fuels, wide product range, hi capex, O 2 extraction, catalysis GTW direct to electricity & transmission unproven

FLNG

smaller units, cheaper concepts,

unproven, operational concerns.

GTL (Diesel, synfuels, naphtha)

cleaner fuels, wide product range,

hi capex, O 2 extraction, catalysis

GTW

direct to electricity & transmission

unproven

Strategic Focus Items Gas flaring Strict regulations are imperative Consider gas recycling/injection options R&D need in-country collaborative R&D modeling and optimisation of value mix, etc. resolve government versus investor goals Good examples from Norway and Trinidad & Tobago

Gas flaring

Strict regulations are imperative

Consider gas recycling/injection options

R&D

need in-country collaborative R&D

modeling and optimisation of value mix, etc.

resolve government versus investor goals

Good examples from Norway and Trinidad & Tobago

Strategic Focus Policy guidelines for new techs: FLNG, GTW, etc. remove uncertainty/ambiguity road blocks encourage domestic market development encourage competitive fiscal regimes focus on local capacity building for gas tech

Policy

guidelines for new techs: FLNG, GTW, etc.

remove uncertainty/ambiguity road blocks

encourage domestic market development

encourage competitive fiscal regimes

focus on local capacity building for gas tech

Thank You! Questions? [email_address]