Gas Contracts are not different from “novels” in the sense that they tell a story about the agreement that the private parties entered into with an energy company within the ambits of applicable laws. The regulatory framework for the use of natural gas is probably still evolving so model contracts might lie somewhere in the future.

1. As it appeared in THISDAY LAWYER (edited by MS Funke Aboyade SAN) in THISDAY NEWSPAPER on the
9TH of July 2013P a g e | 1
WITH SHALE GAS EMERGENCE, TIME TO UP OUR GAME, AND FAST! i
Oh how I wish my Car would run on gas.
It’s being years and I hope my dream comes to pass.
Then I heard one or two Dangote trucks had switched to “dual”
I am not a dreamer, I am just being factual.
Now it seems my dream has begun to gather mass.
Olufola Wusu Esq. © 2013
Gas has floated into the energy equation in Nigeria, as Sagas Energy Company Limited has
started the conversion of the conversion of Dangote’s heavy-duty trucks to enable them use
gas as fuel. It was reported that 200(two hundred) of the 5,000(five thousand) trucks
belonging to Dantrans, of the Dangote group have been successfully converted to run on
both gas and diesel.
A Memorandum of Understanding (MoU) was signed three months ago between Sagas and
the NGC. Under the said MOU, the Nigerian Gas Company, a subsidiary of the Nigerian
National Petroleum Corporation (NNPC) is to exclusively supply Sagas Compressed natural
Gas (CNG) for 20 years while Sagas converts PMS and diesel engine vehicles to adapt the
engines to use.
Oil And Gas Contracts Are Stories…
In the Dangote/Sangas paradigm, Gas Contracts are not different from “novels” in the sense
that they tell a story about the agreement that the private parties entered into with an
energy company within the ambits of applicable laws. The regulatory framework for the use
of natural gas is probably still evolving so model contracts might lie somewhere in the
future.
PIB and Gas Utilization
The PIB if passed into law will probably continue with the use of DSO’S. Before the passage
of the PIB government has tried to promote the utilization of LPG and CNG as cleaner
alternatives to diesel and petrol.

2. As it appeared in THISDAY LAWYER (edited by MS Funke Aboyade SAN) in THISDAY NEWSPAPER on the
9TH of July 2013P a g e | 2
PIB And The Need for Fiscal Terms...
Fiscal terms in any oil and gas contract enumerate the objectives of the host government,
guide and help ensure profitability for all the parties involved from the host government to
the IOC’S.
Domestic Gas Supply Obligations
In an attempt to jump start the Nigeria Domestic Gas Market, the Federal Government of
Nigeria (FGN) introduced the DSO volumes through its National Gas Supply & Pricing Policy
2008. The National Gas Supply & Pricing Policy 2008 mandates all gas (Associated Gas &
Non Associated Gas) producers to dedicate a specific portion of their gas reserves and
production for supply to the Nigerian domestic market. These DSO Volumes are assigned by
the FGN through the DPR.
Are “Domestic Gas Supply Obligations and Pricing Policies” sufficient?
The Dangote/Sagas paradigm has shown the inadequacy of DSO’S alone. For effective gas
utilization we need demand, we already have that, long term supply, a distribution network
(pipeline, trucks and perhaps ships), technical ability for pro gas conversion, and the legal
regulatory frame work that should include the DSO, incentive and model contracts covering
all the facets of the proposed Gas revolution.
Dangote Paradigm: Fuel-Intensive Fleets Have Been Using Natural Gas For Years.
Fuel-intensive fleets travel far and wide each day and have been using natural gas for years.
Examples include taxicabs, transit (like the ones in Benin) and school buses, airport shuttles,
construction vehicles, garbage trucks, delivery trucks, keke napep and public works vehicles.
Large volume of vehicles makes it more economical to convert vehicles or to purchase them
outright. Fleet vehicles are also centrally maintained, making the refueling process
convenient and reliable.
Gas to Liquids Technology in Gas

3. As it appeared in THISDAY LAWYER (edited by MS Funke Aboyade SAN) in THISDAY NEWSPAPER on the
9TH of July 2013P a g e | 3
Research and operations in the gas industry have thrown up “gas to liquids” as a possible
model for the use of renewable energy sources. Research has thrown up new ideas,
procedures, software and equipment that have succeeded in turning gas into a state
(compressed/liquid) in which it can be easily stored, transported and used.
Long-Haul Trucks And Buses Use LNG Too…
In some countries long-haul trucks and buses run on another form of natural gas called
liquefied natural gas, or LNG. LNG is made by refrigerating natural gas to -260°F, condensing
it into a liquid which is much denser with more potential energy for the amount of space it
takes up.
Gas distribution is a Complex Mix…
LPG and CNG distribution might involve distribution by pipeline, trucks and if need be ships.
The major goal is uninterrupted supply of cleaner fuels.
Where can I get a Natural Gas Vehicle?
Two car companies leading the way in NGV design and engineering are Honda and
DaimlerChrysler.
Is The Emergence Of Shale Gas A Game Changer?
The age long reliance the United States and other Western nations have placed on Africa
and the Middle East for Oil and Gas is about to be threatened OR PERHAPS HAS ENDED with
the shift to shale gas by these countries. It’s time to up our game, we need an energy policy
and fast at that! The Group Managing Director of the NNPC, Engr. Andrew Yakubu, was
quoted as having said that “There is no doubt that shale gas has come and is with us, we
also know that it is posing a challenge to the oil and gas activities in Nigeria. With the coming
up of shale gas there has been a drop of pipeline imports from 16 to 12 per cent while shale
gas has grown from 8 to 32 per cent, and LNG import has dropped from 3 to 1 per cent,
which is mainly Nigerian LNG.” Reports have it that the United States plans to start export
of LNG by 2015.

4. As it appeared in THISDAY LAWYER (edited by MS Funke Aboyade SAN) in THISDAY NEWSPAPER on the
9TH of July 2013P a g e | 4
What Is Shale Gas and Why Is It Important?
Shale gas refers to natural gas that is trapped within shale formations. These are finegrained sedimentary rocks that can be rich resources of petroleum and natural gas.
Sedimentary rocks are rocks formed by the accumulation of sediments at the Earth's surface
and within bodies of water.
Shale Gas and Hydraulic Fracturing
Over the past decade, the combination of horizontal drilling and hydraulic fracturing has
allowed access to large volumes of shale gas that were previously uneconomical to produce.
The production of natural gas from shale formations has rejuvenated the natural gas
industry in the United States and other western countries. (Courtesy of EIA)
Hydraulic Fracturing in Nigeria?
The debate over hydraulic fracturing should commence sometime soon and should not be
silenced, but it should remain based on fact, it should be focused on the protection that is
already in place and what actually is being done to increase that protection or it will have
failed to serve the public interest.
Conclusion
After years of not really talking about it, Nigeria needs to control its own energy future,
(exporting all we produce is far from effective control). We need to produce and refine
more oil and gas at home. We need to double the distance our cars will go on a litre of petrol
while shifting our focus to renewable energy, we need to double/increase the amount of
renewable energy we generate from the elements. The world is shifting its focus to
renewable energy sources; we would do well to restructure our energy industry to begin to
take advantage of the season of plenty by preparing and providing for future generations of
Nigerians.

5. As it appeared in THISDAY LAWYER (edited by MS Funke Aboyade SAN) in THISDAY NEWSPAPER on the
9TH of July 2013P a g e | 5
Olufola Wusu Esq. © 2013
i
TH
As it appeared in THISDAY LAWYER (edited by Funke Aboyade SAN) in THISDAY NEWSPAPER on the 9 of July
2013