Nigeria’s Mini-LNG Boom: A Defining Moment for the Gas Sector?

Dear Readers,

Welcome to the maiden edition of conversations from the Energy Desk.

The highly anticipated and publicized groundbreaking ceremony for the five mini-LNG projects in Ajaokuta, Kogi State, took place today!

Olufemi Soneye, Chief Corporate Communications Officer of NNPC Ltd, had proudly announced the projects: NNPC Prime LNG, NGML/Gasnexus LNG, BUA LNG, Highland LNG and LNG Arete.

Under the theme “From Gas to Prosperity: Catalysing Nigeria’s Economic Growth,” this landmark event underscores the government’s commitment to leveraging gas as a key driver of economic transformation. The significance? Five Final Investment Decisions (FIDs) taken, and five groundbreaking ceremonies happening simultaneously!

Inside the Mini-LNG Projects

NNPC Prime LNG: A Small-Scale LNG (SSLNG) project spanning 33 hectares in Ajaokuta, implemented through a Special Purpose Vehicle (SPV) owned by NNPC Trading Limited (90%) and Silver Peaks Limited (10%).

NGML/Gasnexus LNG: A phased 20MMSCFD Mini-LNG plant, starting with a 7.5MMSCFD facility. It will liquefy natural gas from the Oben-Ajaokuta pipeline and distribute it via cryogenic trucks to industrial users.

BUA LNG: A 700TPD (35MMSCFD) Mini-LNG plant developed in partnership between NGML and BUA Industries Limited. This plant will supply liquefied gas to BUA’s Sokoto Cement Plant for enhanced industrial efficiency.

Highland LNG: A cutting-edge SSLNG facility designed to supply gas to off-grid industrial and commercial customers, boosting Nigeria’s Presidential CNG Initiative (PCNGi).

LNG Arete Ltd: A fully Nigerian-owned company committed to providing secure and affordable LNG as a sustainable alternative energy source.

What this means for Nigeria?

This milestone signals Nigeria’s evolving gas strategy, driven by strong public-private collaboration. However, its success will depend on seamless execution, contract sanctity, robust security measures, and enhanced transparency and accountability. If effectively implemented, it could mark a transformative shift in the country’s gas sector.

With gas demand projected to grow at a compound annual rate of 16.6% through 2030, the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) warns of a looming supply shortfall of 3.1 billion cubic feet per day (Bcf/d) under the Base Case Demand and Supply scenario.

Could these mini-LNG projects help bridge the gap and strengthen Nigeria’s energy future?

PLEASE NOTE THAT THIS BLOG POST IS FOR INFORMATION PURPOSES ONLY AND DOES NOT CONSTITUTE LEGAL ADVICE.