Economic Analysis of Natural Gas Pipeline Construction and Electricity Transmission Loss Consideration.

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International Journal of Research and Innovation in Applied Science (IJRIAS) | Volume VII, Issue I, January 2022 | ISSN 2454–6194

Economic Analysis of Natural Gas Pipeline Construction and Electricity Transmission Loss Consideration

Agboola O.P., Uhunmwangho, R.
Dept. of Electrical & Electronic Engineering, University of Port Harcourt, Nigeria, Nigeria

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ABSTRACT
The site of electrical power plants has been a subject of interest due to the advent of electricity and the distance between energy sources (mines, oil and gas fields, and water bodies for renewable energy) and distance load (cities and industrial hubs) centers. The quest for sufficient energy infrastructure to propel Nigeria’s huge and growing population of about 190 million and also to power the much-anticipated industrialization and economic growth and development made government embark on unprecedented investment in natural gas and electricity generation, transmission and distribution infrastructure. The Geregu gas turbine project, located in Geregu, Kogi State consist of a FGN 414 MW open cycle gas turbine commissioned in 2007 and a NIPP 444 MW open cycle gas turbine commissioned in 2013. These turbines are fed with atural gas from Oben gas fields in Edo state through 36 inches, 196 km pipeline whose construction cost is $228,317,572.65 and with revenue form current transportation charges of $0.80/MSCF, has a payback period of sixteen years. However, if the power plants were to be sited in Edo State and a 330 KV transmission line constructed from the power plant to Kogi state, the construction cost would have been $123,426,000.00 and with revenue from current tariff charges of $8.76/MWH, the payback period is 12 years. Hence it is cheaper to construct the power plant in Edo state and evacuate the generated energy via 330 kV transmission lines to Kogi state than to construct the plant in Kogi state and supply natural gas to it via pipeline. Nevertheless, the Oben-Geregu pipeline has throughput capacity of about 1.2 billion scf/d of gas and since the maximum gas requirement by the power plants is 210 MMSCF, the pipeline can serve additional installation requiring natural gas feed along its route thereby raking in additional revenue and thus reduction in its payback period.

Keywords: Natural Gas, Pipeline, Electricity, Transmission line, Transmission loss, Cash Flow Analysis,

I.INTRODUCTION

The aim of the research work is to determine the best approach in deciding whether to site a gas fired thermal generating station close to a source of natural gas (a gas field) and evacuating the generated power to a distant load center via a transmission link or to site the thermal generating station close to the load centre and then construct a gas pipeline and its ancillary facilities to connect a distant gas field to the location of the thermal generating plant.
The objectives of this study include;
• Evaluation of the requirements, cost and benefits of pipeline construction from a gas field to a gas fired thermal plant sited at distance (from Oben gas fields in Edo state to Geregu in Kogi state)
• Evaluation of the requirements, cost and benefits of construction of a transmission link (330 kV and 132 kV) from a thermal power plant assumed to be sited close to Oben gas field in Edo state to a distant load centre Federal Capital Territory (FCT), Abuja.
• To carry out an economic and investment analysis of the two approaches and compare their cost and benefits toward the determination of the best electrical power and gas infrastructural developmental approaches.