Assessing the Implications of Low Carbon Emissions on Future Oil Production in Nigeria

Abstract

Nigeria economy solidly depends on fossil fuels, which serve as the major source of energy and revenue. Fossil fuels, especially petroleum, are readily available to meet the increasing energy demand of a growing population. The aftermath of consuming fossil fuels has globally become a concern, therefore long-term projections of energy demand and supply for proper energy management have become a necessity. Hence, this research focus on forecasting energy demand, predict oil production, projecting GHG emissions from energy demand and supply, and perform cumulative cost-benefit analysis from 2018 to 2060 of demand and supply of energy, under two energy scenarios; Low carbon (LOW) and Reference (REF). The LEAP modelling results show that the demand of energy would continue to increase under the REF scenario, reaching 24.68 billion BOE in 2060 from a base year value of 2.85 billion BOE. While under the LOW scenario, there would be instability in energy demand growth, but from 2031 there would be continuous growth attaining 10.91 billion BOE by 2060. Also from the results obtained, if Nigeria would employ the low carbon scenario policies, the cumulative oil production by 2060 would reduce to one-fifth of the REF, and the cumulative GHG emission from demand and supply is expected to be one-fifth of the REF, resulting to GHGs saving of 30.41 billion MtCO2e in the LOW scenario. Also, LOW scenario relative to REF scenario shows cost of avoided GHGs of 7963.83USD pre MtCO2e, which implies that over 7000USD would be saved for every one MtCO2e that was supposed to be emitted in the LOW scenario. However, if the low carbon scenario will be implemented, there would be urgent need for more technical knowledge and skills to aid effective management of these low carbon energy systems.