Nigeria/benin power deal on shaky grounds as French oil giant, Total signs LNG agreement with Benin
Nigeria/ Benin power deal on shaky grounds as Total, the French oil giant has entered the picture with the aim of supplying Liquefied Natural Gas to Benin to meet its power demand.
If the agreement scales through it means that Benin would soon cease to depend on Nigeria for power supply.
Energy resources are limited and Benin depends on Nigeria and Ghana for energy. GDP growth averaged close to 6 percent in 2012– 2015 but declined to 4.6 percent in 2016 due to a slowdown of exports to Nigeria and a drop in agriculture production.
Nigeria, Niger, and Benin have a long tradition of intergovernmental agreements for exchange of electricity that build on the cooperation between the countries that share the waters of the Niger River. Nigeria has exported electricity for decades, in exchange for Niger and Benin refraining from damming the waters up
stream. The current amounts traded are small in relation to its overall capacity, 180 MW to Niger and 200 MW to Benin.
Electricity exported from Nigeria to Benin is transported through 70 km of 330 kv line between Ikeja and Sakété in Benin, with a, contracted the amount under intergovernmental agreements of 260 MW. In December 2017, a separate contract for 60 MW was signed between the Société Béninoise d’energie Electrique (SBEE) and Parras, a Nigerian independent power producer (IPP), using a oneyear renewable PPA. Given the capacity constraints of the transmission line between Nigeria and Benin, the total amount traded is 200 MW, with priority given to the electricity sold by Parras despite the higher price for this power.
Total, the Republic of Benin and the Société Béninoise d’energie Electrique (SBEE) signed the Gas Supply Agreement and the Host Government Agreement for Total, while the Republic of Benin and the Société Béninoise d’energie Electrique (SBEE) signed the development of a Liquefied Natural Gas (LNG) import floating terminal and the supply of up to 0,5 million tonnes per annum (Mtpa) of regasified LNG from Total’s global portfolio to Benin for 15 years, starting in 2021.
Total will develop and operate the regasification infrastructure that will comprise a floating storage and re-gasification unit (FSRU) located offshore Benin and an offshore pipeline connexion to the existing and planned power plants in Maria Gléta.
This project is in line with Total’s strategy to develop new gas markets by unlocking access to LNG for fastgrowing economies. We are very pleased to have been entrusted by the Benin authorities to develop LNG imports and support a broad adoption of natural gas in the country, said Laurent Vivier, Senior Vice President Gas at Total.
“Access to LNG will help Benin to meet growing domestic energy demand and add more natural gas to the country’s current energy mix, hence reducing its carbon intensity”.
The interconnection between Nigeria and Benin was inaugurated in 2007 with the line to Sakété in Benin. The initial agreement with for Benin the agreements were between CEB and defunct Nigerian Electricity Power Authority.
The Federal government had just renegotiated new terms for the supply of electricity to both Benin and Niger Republics a few days ago. The renegotiation, which was consummated by the Nigerian Bulk Electricity Trading Plc (NBET), was to ensure that the international sale of electricity by Nigeria to the Société Nigérienne d’electricité (NIGELEC) and Communauté Électrique du Bénin ( Togo/ Benin Bi- national Electricity Company) (CEB), reflected appropriate commercial terms.