Economic Analysis of Natural Gas Reserves Addition from Coal Bed Methane in Nigeria


  •   Ibim Abba Green

  •   Kelechi Uchenna Ugoji

  •   B. Ndukam Igbere


The aim of this project is to economically analyze Coal Bed Methane (CBM) development in Nigeria. This will offer an opportunity to use gas from the Nation huge coal reserves for domestic and exportation purposes to boost the economy of Nigeria. CBM can be used to generate power as well as manufacture alternative products. The profitability of coal bed methane (CBM) project depends on factors such as seam thickness, gas content, methane content, coal rank and permeability. Its economics are influenced by other variables, such as fiscal policy, depth of coal seam, volume of water disposal, access to market and price of gas. Potential and existing sites for coal bed methane extraction in Nigeria were identified. Kim’s equation was used to estimate the gas content. The gas-in-place was derived with Volumetric method. Methane quantification was estimated using Eddy curve. It is observed that the ultimate reserves, the capital costs, and the gas price have significant effect on the net present value (NPV) and internal rate of returns (IRR) and thus the economic viability of the project.  Economic analysis of LNG and Pipeline projects for gas transmission were comparatively examined. It is observed that the gas price and demand at the market hub depend largely on the mode of transmission.

Keywords: Coal Bed Methane; Kim’s Equation; Net Present Value; Volume.


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How to Cite
Green, I., Ugoji, K. and Igbere, B. 2019. Economic Analysis of Natural Gas Reserves Addition from Coal Bed Methane in Nigeria. European Journal of Engineering Research and Science. 4, 4 (Apr. 2019), 31-34. DOI: