These pipelines, essential for the movement of crude oil and petroleum products, are located in various regions throughout the country and are buried underground.
Mele Kyari, the Group Chief Executive Officer of NNPCL, announced this initiative during the Nigeria International Pipeline Technology and Security Conference, organized by the Pipeline Association of Nigeria, with the theme “Pipelines – Critical Assets for National Economic Development and Environmental Sustainability,” held on Thursday in Abuja.
He mentioned that the preliminary phase of the rehabilitation process is currently underway, although he did not reveal the estimated costs involved.
The conference aimed to explore solutions for enhancing technological innovation, addressing security issues, and promoting sustainable practices.
In his speech, the GCEO, represented by Folorunsho Kareem, Managing Director of the Nigeria Pipelines and Storage Company, emphasized the importance of pipelines for energy security and their role in reducing carbon emissions. He pointed out that pipelines account for 5 percent of greenhouse gas emissions, in contrast to trucks, railways, and motorways, which contribute 27, 17, and 22 percent, respectively.
He further highlighted that the company is tasked with transporting crude and refined products across the nation, currently supplying eight pump stations to maintain the required flow rate and pressure, along with 22 Product Depots Terminals, one Crude Oil Terminal at Escravos, Bonny Export Terminal, eight LPG butanization plants, and three jetties located in Apapa.
The national oil company has reportedly developed a sophisticated and comprehensive array of technological solutions that utilize state-of-the-art tools and methodologies, prominently featuring extensive data analytics, advanced sensor systems, automation techniques, and artificial intelligence.
He emphasized the critical nature of pipelines as essential infrastructure that facilitates the transportation of vital resources, including oil, natural gas, and water, over long distances to bolster national economic development.
He remarked, “Pipelines are integral to ensuring the efficient and dependable delivery of energy and resources, which in turn propels economic growth. They also play a significant role in promoting environmental sustainability by minimizing the carbon footprint associated with transportation and enabling the distribution of renewable energy sources.”
Kareem elaborated that the company is undertaking a thorough rehabilitation of its pipeline network, especially in areas identified as high-risk, to secure energy stability.
He noted that this rehabilitation initiative is part of a broader strategy aimed at improving the efficiency, safety, and sustainability of Nigeria’s oil and gas infrastructure, thereby ensuring a more dependable and secure supply of petroleum products for both domestic consumption and international export.
He further mentioned that the firm has implemented a cost-effective, low-risk, and high-utilization approach to minimize security expenditures related to pipeline maintenance.
He stated, “We are a globally dynamic organization engaged in the transportation and storage of products. Our network comprises 5,120 kilometers of pipelines distributed throughout the country, supplying crude oil to state-owned refineries and facilitating product distribution across storage depots. We have two-way pipelines A, B, and C, which are unable to transport products from the Warri refinery to the Kaduna refinery, supporting our ongoing rehabilitation efforts at the Kaduna refinery.”
“On maintenance, we identify segments for the damaged or leaked pipeline, we carry out removal of damaged sections, and replace them. Since 2016, we have put up a contract with a security-based company and signed a penalty clause in the contract.
“If there is any leakage, we penalize the contractor of one person cent. And this has been working for us. As a result of this contract, we have been able to achieve zero losses since we started the movement for both Port Harcourt and Warri refinery.
“Now, the current pipeline system, as you would all agree with me, comes with a high-security cost as well as lower utilization because our refineries are not working, but we are working to make sure that our pipeline has low-security costs, risks and high utilisation because very soon all refineries will be working.”
The NPSC leader stated that the company is implementing a Horizontal Directional Drilling (HDD) technique to enhance its infrastructure security. This initiative, structured as a Public-Private Partnership (PPP), is expected to yield a return on investment that surpasses current security expenditures.
He elaborated that the current strategy focuses on constructing a pipeline that is both high-integrity and low-risk. The HDD method will be utilized to install the pipeline in areas identified as high-risk, particularly along the 500-meter stretch from Warri to Kaduna. This section will specifically feature HDD installation. Additionally, to improve operational outcomes, the company plans to incorporate advanced technology for monitoring and managing the pipeline through fiber optic radio sequencing, building on years of experience in pipeline operations.
The financing for this project will be arranged through a Build, Operate, and Transfer (BOT) model under the public-private partnership framework. The assets have been divided into four categories: the Port Harcourt refinery and its associated infrastructure, the Warri refinery and its related facilities, the Kaduna refinery and its infrastructure, and the Atlas. The BOT partner is collaborating with the company to ensure that the entire network of 5,120 kilometers of pipelines is fully rehabilitated and prepared for transporting crude oil and finished products nationwide.
The anticipated return on investment will be generated through a throughput fee, which is projected to exceed current security costs and losses.
In a virtual address, the Minister of State for Petroleum Resources (Gas), Ekperikpe Ekpo, reaffirmed the government's dedication to leveraging the full potential of gas resources transported via pipelines to stimulate economic growth, enhance energy access, and foster industrial development.
However, the minister emphasized the need to reassess the security measures in place to protect this critical infrastructure, given the ongoing issues of vandalism and sabotage.
He emphasized that, "In light of the significant economic potential of our natural resources, our pipelines are still highly susceptible to vandalism, sabotage, and theft. The repercussions are severe, resulting in revenue loss, environmental harm, and a risk to national security. Consequently, this administration will persist in developing and implementing new strategies to maintain the highest level of pipeline security. This will include the adoption of innovative technologies, enhancement of security protocols, and the promotion of stronger collaboration among stakeholders to effectively address emerging challenges."
He also highlighted the nation's dedication to environmental sustainability.
The minister further stated, "The relationship between operational activities and environmental sustainability is crucial. While oil production is vital to our economic strategy, it must be conducted with a strong emphasis on minimizing environmental impacts, in alignment with Nigeria’s global climate commitments. We are leading an initiative that advocates for sustainable operations, which includes strict adherence to environmental standards and ensuring compliance with internationally recognized environmental health practices."
Additionally, Alhassan Ado Doguwa, the Chairman of the House Committee on Petroleum (Upstream), underscored the necessity of advancing strategies and solutions to enhance oil revenue and foster sustainable business practices within the sector.
He assured the National Assembly's commitment to safeguarding critical national assets and encouraged the association to propose improvements for the effective implementation of the Petroleum Industry Act.
In his opening remarks, Geoff Onuoha, Chairman of the Pipeline Professionals Association of Nigeria, pointed out the significant link between pipeline infrastructure and energy access.
He asserted that achieving this goal requires the establishment of strategic partnerships among the government, stakeholders, and host communities to create a positive impact.
Nigeria has significantly increased its investment in pipeline infrastructure to enhance the sector. I am optimistic that as the government progresses with these developments, there will be an improvement in the quality of life.
Pipelines are essential, and infrastructure plays a vital role. The government acknowledges this importance and has established frameworks to foster a connection between pipelines, energy, economic growth, and overall quality of life.