With the global demand for gas skyrocketing in the wake of the 2022 Ukraine-Russia war, Nigeria has emerged as a critical player for the European Union
“The EU imports 14% of its total LNG supplies from Nigeria,” the deputy director general of the European Commission’s energy department, Matthew Baldwin, told newsmen as the Russia invasion sparked an intense global energy clutch.
Desperate for energy survival after slamming Russia, one of its biggest gas suppliers, with severe economic blockades, Nigeria, the African largest gas reserves quickly became a bride caught in the global politicization of gas supply. “After it invaded Ukraine in 2022,” the International Energy Agency stated on its official website, “Russia cut 80 billion cubic meters (bcm) of pipeline gas supplies to Europe, plunging the region into an energy crisis.”
‘Oil giant. Gas giant’
Nigeria, the largest African gas reserve, has an estimated 202 trillion cubic feet (tcf) of untapped proven gas reserves. According to NNPCL, the country’s estimated recoverable gas stands firmly at 139.4 tcf, making the most populous nation in Africa the 9th largest proven gas reserve globally.
Despite its remarkable capacity to become a leading global energy player, the country’s shortage of gas gathering and distribution infrastructure, fiscal and regulatory policy, funding, and security volatility in the Niger Delta has remained clogs in the wheel of the sector’s progress and potential.
But the recent deal between NNPCL and Total Energies seems to offer some rays of hope. The deal, estimated at $550 million, will see the exploration of the nation’s extraordinary and untapped proven gas. Experts posited that Nigeria gas has the potential of attracting $14 billion in foreign direct investment while creating over 2 million jobs and adding $12 billion to the federal government’s revenue
According to reports, the two oil giants signed a memorandum of understanding (MOU) for the final investment decision (FID) on the Ubeta Field Development Project on Thursday in Abuja.
“I am very convinced that many more projects will come alongside this as we progress,” NNPCL group chief executive officer Mele Kyari said at the meeting. “No doubt, this project will create opportunities, jobs, and everything you can imagine, including making our energy investment much more productive.” Mike Sangster, senior vice president of Africa, exploration, and production at TotalEnergies, expressed his satisfaction with the firm’s launch of the gas project, which he attributes to the government’s recent incentives for non-associated gas developments.
“Ubeta is the latest in a series of projects by TotalEnergies in Nigeria, most recently Ikike and Akpo West.” Sangster stated, “Ubeta fits perfectly with our strategy of developing low-cost and low-emission projects and will contribute to the Nigerian economy through higher NLNG exports.” While speaking, Heineken Lokpobiri, minister of state for petroleum resources (oil), asserted that the president has significantly rekindled investor confidence in the oil and gas industry. He added that one of the country’s biggest challenges, on the assumption, was a lack of investment and trust in Nigerian policies in the last 12 years, positing that the government has changed the narrative in the previous nine months.
‘CNG-Powered Vehicles’
“In line with his commitment to ensure energy security, drive utility, and cut high fuel costs, President Bola Tinubu has directed the mandatory procurement of compressed-natural-gas-powered vehicles by all government ministries, departments, and agencies,” a statement by Ajuri Ngelale, Special Adviser to the President on Media and Publicity, noted. The statement added that the CNG adoption by public officials will set an example across the country”.
Energy experts contend that the country’s newfound drive towards energy sustainability will remain a pipe dream without investment in the sector, adding that more investment will be needed to truly unlock and unleash the giant within its oil and gas sectors.
