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Boosting Natural Gas Utilization in Nigeria

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Andrew R. Michaud

• December 06, 2023

*IBADAN, Nigeria - *Nigerian National Petroleum (NNPC) announced on Wednesday that it has signed agreements for two liquefied natural gas (LNG) projects aimed at enhancing Nigeria's gas revenue and promoting the utilization of natural gas.

Floating LNG Project: Targeting the International Market

NNPC has signed a memorandum of understanding (MoU) with Wison Heavy Industry, a Chinese company, for the development of a floating LNG project in Nigeria. This project aims to tap into the international LNG market, as stated by NNPC spokesman Olufemi Soneye. The MoU was signed during COP28 in Dubai, signifying the collaborative effort between the two parties to outline a roadmap for project development and ultimately make an investment decision.

Small-Scale LNG (SSLNG) Project: Meeting Domestic Demand

Additionally, NNPC Prime LNG, an arm of NNPC Trading, has entered into a supply, installation, and commissioning agreement with SDP Services, an independent oil and gas company. This agreement pertains to a 421 tons per day LNG project targeting the domestic market. The SSLNG Project will be situated in Ajaokuta, in Nigeria's north-central Kogi state. Its primary aim is to ensure an efficient supply of LNG to Autogas/Compressed Natural Gas and industrial/commercial customers nationwide. The project is anticipated to commence operations by December 2024, delivering approximately 420 tons per day of LNG to meet domestic demand.

Unlocking Nigeria's Abundant Gas Resources

"We perceive both projects to have a significant impact across the country since they are fundamental to commercializing Nigeria's vast gas resources and enabling our nation to generate much-needed foreign revenue from these abundant assets," stated Olalekan Ogunleye, a senior NNPC official during the signing ceremony.

Nigeria possesses substantial natural gas reserves, currently estimated at 206 trillion cubic feet, with the potential for expansion to 600 trillion cubic feet. Utilizing gas resources has become a priority for Nigeria as it drives its energy transition forward, according to Kele Kyari, NNPC's group managing director.

-By Obafemi Oredein; Dow Jones Newswires