Nigeria is anticipating fresh investments valued at over $500 million from investors who have indicated interest to invest in the domestic value chain of the Nigerian gas sector.
This development comes one year after the formal launching of the Nigerian Gas Transportation Network Code (NGTNC) on August 10, 2020, which have allowed the Department of Petroleum Resources (DPR) to record a number of achievements including a half-billion dollars worth of investments now in consideration resulting from improving investors’ confidence in Nigeria’s gas network code.
The investment value, according to DPR’s executive director Sarki Auwalu, was derived from investment proposals for power generation, ammonia for fertilizer, domestic LNG, methanol, virtual gas pipeline systems, new gas hubs, and the establishment of Nigeria gas trading exchange.
DPR’s CEO highlighted six major game-changing effects the new code will have on attracting more investment into Nigeria’s pipeline infrastructure.
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According to Awulu, the new structure will provide a set of rules that govern the gas transportation system, ensure non-discriminatory access to the pipeline system, and guarantee a secure, available, reliable, and safe gas transmission system.
“The code will attract more investors into pipeline infrastructure,” Awulu said.
Awulu noted the new code will ensure cost-reflective tariffs for pipeline services, support the development of matured gas markets and provide a mechanism for effective handling of contractual disputes.
“The new code will also support the development of matured gas markets, and provide a mechanism for effective handling of contractual disputes,” Awulu said.
Most stakeholders say the new NGTNC initiative has increased the activities of investors like gas shippers, suppliers, agents on the network and had further promoted gas availability, accessibility, affordability, and awareness.
They noted that the new network code had improved transparency and predictability in gas trading, thereby stimulating the growth of the gas business and deepening the performance of the Nigerian gas value chain.
The federal government is currently targeting 40 billion barrels of oil reserves by 2025, increasing its gas reserve to 210 trillion cubic feet (tcf) by 2025 and 220tcf by 2030.
