Nigeria Requires $20 Billion Annually for Gas Expansion Projects – NEITI

The Nigeria Extractive Industries Transparency Initiative (NEITI) has highlighted the need for an annual investment of $20 billion to accelerate the country’s gas expansion plan and bridge critical gaps in Nigeria’s gas infrastructure. Dr Orji Ogbonnaya Orji, Executive Secretary of NEITI, stressed the importance of infrastructure clarity in the face of shrinking fossil fuel investments. He made these remarks during a policy dialogue on Nigeria’s Decade of Gas Action plan, jointly organized by the African Initiative for Transparency, Accountability, and Responsible Leadership (AFRITAL) and the Natural Resource Governance Institute (NRGI) in Abuja.

Nigeria’s Gas Expansion and Investment Requirements
The Nigerian government launched the National Gas Expansion Programme (NGEP) in December 2020, aimed at promoting the extensive use of natural gas as a cleaner and more affordable energy source for both industrial and personal consumption. Dr Orji noted that Nigeria possesses the ninth-largest global gas reserves, with over 200 trillion cubic feet (tcf) of gas. He highlighted that the Petroleum Industry Act (PIA) has played a significant role in strengthening governance and fiscal frameworks for the gas sector’s growth.

However, achieving the ambitious gas expansion targets will necessitate substantial investment in infrastructure, particularly connectivity across various stages of the gas supply chain, from upstream facilities to processing, power plants, and end uses. To achieve these goals, an estimated $20 billion annual investment is required.

Challenges and Recommendations
Dr Orji emphasized that achieving the desired gas expansion requires deliberate and ambitious investments in infrastructure, given the increasing demand for natural gas. He recommended that the Nigerian government develop and publish a comprehensive gas policy with clear roles for state and non-state actors, along with realistic timelines for tracking progress. Additionally, he called for an integrated approach that aligns the gas policy with Nigeria’s energy transition policies, supported by robust monitoring and evaluation mechanisms.

The Path Forward for Nigeria’s Gas Industry
Dr Louis Ogbeifun, Executive Director of AFRITAL, lamented the irony of Nigeria’s rich gas resources but widespread use of firewood and coal for cooking due to energy poverty. He highlighted the government’s “Decade of Gas Action Plan (DofG)” as a crucial step toward reversing this narrative and achieving energy accessibility, affordability, and sustainability. Notably, the construction of the 614km Ajaokuta-Kaduna-Kano gas pipeline is a cornerstone project to transport significant natural gas volumes per day.

Furthermore, the Nigeria-Morocco Gas Pipeline project aims to extend the West African Gas Pipeline and potentially connect to the European market. While challenges and risks persist, the focus remains on domestic infrastructural development, LPG and CNG adoption, and transitioning away from petrol dependency.

The gas industry stakeholders also emphasized tackling forex and policy challenges, promoting investment and financing access, and fostering the role of indigenous players in the sector. The Ministry of Petroleum Resource reaffirmed its commitment to energy transition, with ongoing efforts to realize the NGEP’s goals and promote compressed natural gas engine conversions to meet growing demand.

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