Refinery projects will outnumber all other projects in upcoming oil and gas investments in Nigeria by 2026, a new report published by GlobalData, a UK-based Data and Analytics Company has said.
According to the report, more than 100 oil and gas projects will begin operations in Nigeria over the next four years, accounting for more than a quarter of all projects expected to begin during that time.
Data from the report showed that petrochemicals will account for 14 of the 109 projects set to begin operations in Nigeria, upstream (fields) will account for 26, midstream will account for 31, and downstream (refineries) will account for 38.
Teja Pappoppula, an Oil and Gas Analyst at GlobalData, said that Nigeria is mainly investing in oil & gas production, storage and refinery projects over the next five years.
“These upcoming projects would boost Nigeria’s economy and help the country to transform from an importer to an exporter of refined products, especially to neighbouring countries.”
Similarly, an expert believes that this development is also necessary because it will usher in more jobs and lead to technology transfer in the economy, given that the country is already preparing for full operation of the 650,000 barrel per day (bpd) Dangote refinery, and also that the country still struggles to meet the Organisation of Petroleum Exporting Countries (OPEC) quota.
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Emmanuel Iheanacho, Former Interior Minister said, “The fact that we have Dangote refinery that produces 650000 barrels per day, we still need more than that, maybe one billion barrels and then, we are able to refine 1billion barrels and add full value to it.
“Then we will have additional jobs, we will have a technology transfer and addition to our economy which improves the lives of people who are on the receiving end.”
Meanwhile Pappoppula added, “Midstream projects account for about 28 percent of all oil and gas projects in Nigeria by 2026. Gas processing projects comprise the majority of upcoming midstream projects with ANOH-Seplat, ANOH-SPDC and Brass being the key projects with a capacity of over 300 million cubic feet per day each.”
In addition, the country is heavily investing in natural gas processing, pipelines, and liquefaction projects in order to reduce its reliance on oil, which currently accounts for the majority of the country’s revenue. According to the report, Nigeria will account for 24 percent of oil and gas projects by 2026.
Speaking about the project’s potential challenges, Emmanuel said, “It will cost money to build more refineries, and there is a need for a creative policy.
“These challenges will make it impossible to achieve any goal you have set for the development of a refinery.” “Because everything is dependent on how well you articulate and stick to your business plan,” he explained.
