Gas-To-Power Supply Chains in Developing Countries: Comparative Case Studies of Nigeria and Bangladesh
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March 2017 Gas-to-Power Supply Chains in Developing Countries: Comparative Case Studies of Nigeria and Bangladesh OIES PAPER: EL 24 Donna Peng Rahmatallah Poudineh The contents of this paper are the authors’ sole responsibility. They do not necessarily represent the views of the Oxford Institute for Energy Studies or any of its members. Copyright © 2017 Oxford Institute for Energy Studies (Registered Charity, No. 286084) This publication may be reproduced in part for educational or non-profit purposes without special permission from the copyright holder, provided acknowledgment of the source is made. No use of this publication may be made for resale or for any other commercial purpose whatsoever without prior permission in writing from the Oxford Institute for Energy Studies. ISBN 978-1-78467-081-8 i Gas-to-Power Supply Chains in Developing Countries: Comparative Case Studies of Nigeria and Bangladesh Contents Abstract ................................................................................................................................................... v Acronyms ............................................................................................................................................... vi 1. Introduction .........................................................................................................................................1 2. Literature review..................................................................................................................................3 2.1 Research agenda definition ..........................................................................................................3 2.2 Conventional research studies......................................................................................................5 2.3 The updated SCPR Framework..................................................................................................10 3. Case description ...............................................................................................................................16 3.1 Country background....................................................................................................................16 3.2 Performance viewed within the political dimension ....................................................................21 3.2.1 Nigeria...................................................................................................................................21 3.2.2 Bangladesh ...........................................................................................................................24 3.2.3 Comparison...........................................................................................................................25 3.3 Performance viewed within the governmental/regulatory dimension .........................................28 3.3.1 Nigeria...................................................................................................................................28 3.3.2 Bangladesh ..............................................................................................................................40 3.3.3 Comparison...........................................................................................................................46 3.4 Performance viewed within the commercial dimension ..............................................................50 3.4.1 Nigeria...................................................................................................................................50 3.4.2 Bangladesh ...........................................................................................................................57 3.4.3 Comparison...........................................................................................................................66 4. Discussion.........................................................................................................................................69 4.1 On three-dimensional regulation.................................................................................................69 4.2 Evaluation of three-dimensional performance ............................................................................73 4.2.1 Reserve addition and extraction ...........................................................................................73 4.2.2 Natural gas transportation ....................................................................................................75 4.2.3 Conversion to electricity........................................................................................................76 4.2.4 Electricity provision ...............................................................................................................77 4.3 Relevance for other countries .....................................................................................................78 5. Conclusion ........................................................................................................................................79 References............................................................................................................................................81 Figures Figure 1: Natural gas-fired generation vs. Electricity access for select world countries.........................2 Figure 2: SCP-based framework proposed by Jamasb et al. .................................................................4 Figure 3: Commercial dimension of the SCPR framework ...................................................................12 Figure 4: Governmental /regulatory dimension of the SCPR framework..............................................12 Figure 5: Political dimension of the SCPR framework ..........................................................................13 Figure 6: Recent trends in Nigeria and Bangladesh population growth ...............................................16 Figure 7: Recent trends in urbanisation in Bangladesh and Nigeria.....................................................17 Figure 8: Comparison of the size of Bangladesh and Nigeria ..............................................................18 Figure 9: Population density distribution of Nigeria and Bangladesh ...................................................18 Figure 10: Oil and gas reserve of world countries ................................................................................19 Figure 11: Total primary energy supply and biomass fuel consumption in Bangladesh and Nigeria...20 Figure 12: Total primary energy supply after deducting biomass fuel ..................................................20 Figure 13: Distribution of major ethnic groups in Nigeria......................................................................22 Figure 14: Composition of Nigeria's federal revenue............................................................................22 Figure 15: Share of the federation account between different government tiers..................................23 Figure 16: Worldwide Governance Indicators for Bangladesh, Nigeria, and the UK for 2015 .............26 Figure 17: Trends in per capita real GDP of Nigeria and Bangladesh .................................................27 ii Gas-to-Power Supply Chains in Developing Countries: Comparative Case Studies of Nigeria and Bangladesh Figure 18: Comparison of GDP structure for Nigeria and Bangladesh.................................................28 Figure 19: Absolute and relative gas flaring in Nigeria .........................................................................31 Figure 20: Clustered view of gas fields .................................................................................................32 Figure 21: Gas use and operatorship for different gas field clusters ....................................................32 Figure 22: Volume of gas use by operator and field cluster .................................................................33 Figure 23: Use of Nigeria's generation capacity ...................................................................................36 Figure 24: Evolution of government and company-owned generation capacity in Nigeria...................38 Figure 25: Estimated electrification rate by state..................................................................................39 Figure 26: Recent trends in Bangladesh gas production......................................................................41 Figure 27: Distribution of gas fields and gas transmission infrastructure in Bangladesh .....................42 Figure 28: Evolution of government and company-owned generation capacity in Bangladesh ...........44 Figure 29: Regional distribution of generation capacity in Bangladesh................................................45 Figure 30: Trends in fiscal revenue and expenditure for Nigeria and Bangladesh...............................47 Figure 31: Trends in official development assistance for Nigeria and Bangladesh..............................48 Figure 32: Reserves to production ratio of natural gas for Bangladesh and Nigeria............................48 Figure 33: Comparison of gas production and use...............................................................................49 Figure 34: Power generation in Bangladesh and Nigeria .....................................................................49 Figure 35: Annual per capita electricity consumption as a function of per capita