…To deliver 350 million standard cubic feet of gas per day
The federal government has concluded a final investment decision (FID) for a $550m million upstream gas project, expected to deliver 350 additional standard cubic feet of gas per day.
The project, BusinessDay gathered, is part of the reforms introduced in Nigeria since June 2023. It focuses on improving energy security, attracting investment and deepening collaboration with key partners, including the United States government.
The reforms also include initiatives to improve cash flows in electricity distribution through smart metering and the payment of outstanding debts owed investors, and to reduce carbon emissions from gas production.
To support the reform efforts, President Bola Tinubu issued five new executive orders aimed at providing fiscal incentives for investment and reducing the cost and time of finalizing and implementing contracts to develop and expand gas infrastructure.
The directives aim to immediately unlock up to $2.5 billion in new oil and gas investments in the country.
Olu Verheijen, special adviser to the president on energy, disclosed this at a luncheon organised as part of the inaugural US-Nigeria Strategic Energy Dialogue hosted by the US State Department, in Washington DC, according to a statement by Morenike Adewumi, stakeholder manager, Office of the Special Adviser to the President on Energy.
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The dialogue was established in June 2023 to create a platform for the US and Nigerian governments as well as the private sector to deepen bilateral cooperation to advance the implementation of shared energy and climate action ambitions.
Olu Verheijen said, “The reforms have since started yielding results, with the recent announcement of Final Investment Decision (FID) on a new $550 million upstream gas project that will deliver 350 million standard cubic feet of gas per day when operational.”
She also disclosed that Nigeria seeks to create a robust regulatory framework and attract new investments for the production of gas for power, transportation and clean cooking.
“I cannot overstate the importance of our longstanding relationship with the US and this inaugural dialogue. ”
“The goal of this dialogue is for us to jointly proffer solutions that will close the energy access gap for close to 100 million Nigerians who still lack reliable power,” said Verheijen. “We want existing and potential partners to better understand our areas of priority so that our collaboration can be better targeted, and with tangible outcomes.”
“The inaugural U.S.-Nigeria Strategic Energy Dialogue [sets] the stage for strengthened energy collaboration between the United States and Nigeria.
“Together, we’re advancing shared energy security, decarbonization, and economic growth goals,” said Geoffrey R. Pyatt, Assistant Secretary of the State Department’s Bureau of Energy Resources (ENR).”
Verheijen highlighted key reforms that the government of Nigeria has launched to improve the viability of the gas-to-power value chain since President Bola Ahmed Tinubu assumed office.
She acknowledged the support of financing and technical partners like the United States government, the World Bank and the African Development Bank towards Nigeria’s ambitious goals to expand electricity access and reliability through grid and off-grid solutions.
Verheijen affirmed her optimism about the bright prospects for Nigeria’s energy sector, especially with the renewed focus on gas as a transition fuel in the race to meet the country’s commitments to the Paris climate agreement.
She said, “We see resilient demand for gas through the energy transition as it is a readily available, cost-effective backup to renewables while cutting emissions by half immediately.”
The Nigerian delegation to the US-Nigeria Strategic Energy Dialogue, which took place on the 11 and 12 September, 2024, was led by the Ekperikpe Ekpo, Minister of State for Petroleum Resources, and included officials from the Ministry of Power, Nigerian Upstream Petroleum Regulatory Commission, Nigerian Midstream and Downstream Petroleum Regulatory Authority, Nigerian Content Development and Monitoring Board, NNPC Limited, and others.
The US delegation included representatives from the Bureau of African Affairs, USAID, the U.S. Department of Energy, the U.S. Trade and Development Agency (USTDA), and the Export-Import Bank (EXIM).
