Ambitions in Nigeria’s energy sector

Nigeria

Akintoye Akindele, managing director of Adamantine Energy, talks to The Energy Year about the latest on the company’s gas and energy parks and its ambition of developing energy infrastructure in Africa. Adamantine Energy is developing energy parks in Nigeria’s Edo and Bayelsa states, as well as a gas park in Ajaokuta.

How do you evaluate the recently announced Petroleum Industry Act (PIA)?
The PIA prescribes long-awaited and far-reaching reforms for the local oil and gas industry designed to stimulate foreign investment into the sector, enhance transparency and accountability and encourage the existing players by easing their business operations and introducing policies designed to ensure a more positive impact on the local and host communities, among several other reforms.
The government, by implementing the PIA and successfully concluding the 2020 marginal field bidding round, sent a strong signal to industry stakeholders about a new wave of increased efficiencies within the sector. The PIA saw the creation of two new industry regulators, Nigerian Upstream Petroleum Regulatory Commission (NUPRC) and the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) to superintend the upstream and downstream oil sectors, respectively.
Both regulators are successfully transforming the sector with the introduction of visionary policies and incentives that have inspired the confidence of new and existing players and investors, resulting in a much more robust and fast-growing energy sector in Nigeria. Their amazing work is already recording massive benefits to both the oil companies and their host communities.

Can you give us an overview of the Ajaokuta Gas Park?
The Ajaokuta Gas Park is a project designed to deliver gas to the presently unserved and underserved parts of northern Nigeria, where the huge demand for gas-to-power solutions continues to increase. The park is strategically located less than 14 metres from both the existing AKK pipeline and Nigeria Gas Company-pipeline infrastructure. The park will tie in to one or both pipelines to receive its natural gas supply. Phase 1 will see the construction of an 8-mcf [226,560 cubic metres] CNG plant alongside a 2-mcf [56,640-cubic-metre] LNG plant.
The plant is designed to inject natural gas and produce both CNG and LNG in a continuous process with products evacuated immediately via truck to their final offtakers and consumers with little or no need for on-site storage. While CNG delivery is limited to a transportation radius of about 300 kilometres before loss of pressure occurs, the delivery and reach of LNG delivery via skid- mounted LNG trucks is limitless.
This enables us to access the entire northern market as well as international markets within the West African sub-region up to and beyond 1,500 kilometres. The demand for our gas includes residential communities, local industries and power plants.
In our Phase 2 development, we will construct an LPG plant and increase the capacities of the existing 2-mcf [56,640-cubic-metre] LNG plant and 8-mcf [56,640 cubic metre] CNG plant to 10 mcf [283,200 cubic metres] and 20 mcf [566,400 cubic metres] respectively. Using our existing 2-MW gas generator infrastructure, we fully intend to provide power to our host communities as part of our commitment to impact them in meaningful ways, with diverse and strategic developmental programmes.
The Ajaokuta Gas Park sits on a 28-hectare [280,000-square-metre] acreage. Our first phase utilises 5 hectares [50,000 square metres], with the balance being earmarked for future expansion and setting up of additional industrial development, which has already been identified. We are able to successfully deploy cutting-edge modular technology that supports incremental growth in our operations in a structured and efficient manner.

How is the Atlantic Energy City structured?
We are developing an energy city on a 24-hectare [240,000-square-metre] acreage in Okpoama, Brass, Bayelsa State. The complex comprises a 10,000-bpd modular refinery (commencing with 2,000 bpd), five large commercial jetties supporting up to 30,000-dwt vessels, 30,000 tonnes of feedstock and product tank farm storage, a 5-MW power plant facility (commencing with 2 MW) a Tier 4 data centre providing data security and storage services to the oil industry and industrial park facilities that have today attracted a tyre pyrolysis processor, waste recycling facility, cylinder manufacturing factory, bitumen manufacturing and equipment fabrication for the oil and gas industry.
The Atlantic Energy City is also a free trade zone. This tax-free status makes it a very attractive destination for industries and manufacturers to take advantage of the financial benefits and incentives to site and develop their businesses within the city. It has significantly opened up the hinterland, providing jetty access to accommodate large vessels. There are also plans to revamp an unused airstrip, further opening the area up to international visitors and investments.
The Atlantic Energy City is expected to evolve into a small community, thanks to the residential and entertainment facilities planned during its expansion phase. The free trade zone status also attracts international banks to provide financial services without any foreign currency restrictions and, as such, continues to attract high-profile clientele seeking an exciting, safe and modern environment.

What are the main updates regarding the Duport Energy Park?
The Duport Energy Park is scheduled to commence test commercial operations in September of 2022. We have received the approval of the NMDPRA to inject hydrocarbons into our refinery following the successful completion in July of 2022 of the pre-start-up audit, a rigorous safety and security exercise conducted by a team of regulators designed to certify our preparedness and compliance with all regulatory and environmental requirements. Accordingly, operations will commence at an initial 80% capacity for an initial 90-day test phase period, after which we will be issued with a licence to operate, and then move to our installed capacity and full-scale commercial production.
The Duport Energy Park consists of a modular refinery with 10,000-bpd installed capacity (commencing with 2,500 bpd), a 60-mcf [1.70-mcm] gas processing facility, a 5-MW power plant, 12,000-tonne feedstock and product storage facilities, a 6-mcf [169,920 cubic metres] per day compressed natural gas (CNG) plant, a Tier 4 data centre and several associated utilities.
This enormous and strategic project has benefited from the direct support of the NCDMB [Nigerian Content Development and Monitoring Board], the federal government through the Ministry of Petroleum Resources and agencies invested in developing local capacity and attracting serious investors into the sector. Finally, Duport has been able to successfully reduce the risk of the operations of the refinery by identifying and developing a diverse feedstock and inventory base beyond the present pipeline injection of crude and condensate.

What is the role of digitalisation in your energy park?
Our energy park has a Tier 4 data centre, the first of its kind in Africa, enabling us to provide data storage and communications facilities in a secure manner. We can access cloud services and enhance connectivity for operators, especially in the oil and gas industry, allowing for safe and secure storage of their data on the continent. It is amazing to imagine that some of these data were being stored offshore because of the lack of reliable local alternatives. We have partnered with Huawei, a respected industry operator. This is the first time a major global company agreed to design a modular mobile data centre in Africa. These facilities will ultimately be highly beneficial to industries in the oil and technology sectors, and we have already received significant interest and requests for collaboration in our energy park.
The key comparative advantage lies in the nature of cloud technology being deployed, providing remote access for companies to both store and access their data virtually and securely. Our plan is to roll out a stream of data centres around Africa with endless opportunities for global connectivity.

What are the comparative advantages of modular solutions in the energy industry?
Modular solutions such as refineries, gas plants and power plants are a great way to convert our natural assets into a commonwealth for Nigerians. Our energy poverty is caused by an asymmetry between consumption and production. Modular solutions enable us to produce more and bridge that gap. They also bring employment and social impact to host communities.

How is Adamantine Energy reducing its carbon footprint?
We are building a solar farm in the Atlantic Energy City. We are also building a pyrolysis plant to foster waste-to-power solutions in our facilities. We are very proud to announce that we are currently in advanced talks to establish a carbon exchange market in Nigeria, which has never been done before. Our aim is to be an energy company with a negative carbon footprint.

What is the company’s growth strategy?
Our ambition is to build 10 energy parks by 2025 across Africa. We plan to have a total refining capacity of at least 100,000 bpd, a gas processing capacity of about 500 mcf [14.2 mcm] per day and be able to generate 500 MW of power. We also plan to establish at least 300 data centres to foster African digitalisation. The end goal is to create an African ecosystem that builds competencies to lead in the modern era of engineering. We are trying to build an African future by becoming the biggest and most respected energy company on the continent.
Finally, we are developing our marginal field, having just received our PPL [petroleum prospecting licence] and further deepening our footprints in the upstream oil and gas sector.

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