TotalEnergies and NNPC to Invest $550 Million in Nigeria Gas Facility.
TotalEnergies and Nigeria’s state oil company, NNPC Ltd, are set to invest $550 million in the development of a gas processing facility in southern Rivers State. The move aims to enhance both export capabilities and domestic gas supply, according to a source familiar with the agreement who requested anonymity due to the lack of authorization to speak publicly on the matter.
The investment will fund the construction of a gas processing plant and an associated pipeline. The facility will be located on the Ubeta onshore gas field, a site jointly owned by TotalEnergies and NNPC, and will supply gas to the Nigeria Liquefied Natural Gas (NLNG) plant. NLNG is a consortium that includes NNPC, Shell, TotalEnergies, and Italy’s Eni.
When completed, the plant is expected to produce 350 million standard cubic feet of gas per day and 10,000 barrels per day of associated liquids, significantly boosting Nigeria’s processing capacity.
Nigeria, which possesses Africa’s largest natural gas reserves of over 200 trillion cubic feet, has historically faced challenges with gas flaring due to insufficient processing infrastructure and capital constraints. This new investment could signal a turning point, aligning with President Bola Tinubu’s efforts to attract investment into the country’s energy sector.
Analysts see this development as a positive step towards improving Nigeria’s energy landscape. Clementine Wallop, Director of Sub-Saharan Africa at political risk consultancy Horizon Engage, noted, “The government will hope this offers confidence not only in the quality of the Nigerian resource base, but also in the government’s pledge to improve ease of doing business.”
Related Posts
Despite holding substantial natural gas reserves, Nigeria has struggled to increase its exports to the European Union, which has been seeking alternatives to Russian gas due to the Ukraine conflict. Domestically, the country also faces challenges in supplying gas to its power plants, which are crucial for generating the majority of its grid electricity.
An official announcement regarding the investment is expected later this week.
