Open AccessECONOMIC FRAMEWORK FOR GAS PIPELINE DEVELOPMENT IN NIGERIA
Author(s) -
Henry Biose,
Adewale Dosunmu,
Chijioke Nwaozuzu
Publication year - 2020
Publication title -
international journal of engineering technologies and management research
Language(s) - English
Resource type - Journals
ISSN - 2454-1907
DOI - 10.29121/ijetmr.v6.i12.2019.474
Subject(s) - internal rate of return , net present value , payback period , natural gas , discounted cash flow , profitability index , present value , pipeline (software) , economics , natural resource economics , economic evaluation , investment (military) , cash flow , business , finance , engineering , macroeconomics , waste management , production (economics) , political science , mechanical engineering , politics , law , microeconomics
The paper present an economic model and framework for the development of natural gas pipeline for sustainable economic development in Nigeria. The study reviewed the economics of natural gas pipeline development in Nigeria. The research formulated an economic model for a case study of Calabar to Ajaokuta 417km gas pipeline project and a discounted cash flow for an economic life of 40 years. The project economics indicates a Net Present Value (NPV) of 12.5 billion USD with a discounted payback period of 7 years and 9 nine months, Profitability Index (PI) of 7.30, Internal Rate of Return of 23.05% and Growth Rate of Return 26.97% and these project economic indicator shows that the gas pipeline investment is viable. This study provides an economic model that would guarantee security of gas supply, provide access to clean energy and provides an economic framework to support long term natural gas pipeline development in Nigeria