The P-CNGi will invest $6 million, LNG Arete Ltd. will contribute $12 million
The partnership aims to expand CNG infrastructure investment
The Presidential Compressed Natural Gas Initiative (P-CNGi) and LNG Arete Ltd. have signed a $27.3 million Memorandum of Understanding (MoU) to develop a Liquefied Natural Gas (LNG) plant in Ajaokuta, Kogi State.
Eko Hot Blog reports that the partnership aims to expand CNG infrastructure investment, increase accessibility, and create over 100 jobs for Nigerians.
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With a processing capacity of seven million standard cubic feet per day (MMSCFD), the project seeks to accelerate CNG infrastructure development in the northern region.
The P-CNGi will invest $6 million, LNG Arete Ltd. will contribute $12 million, and the Midstream Downstream Gas Infrastructure Fund, managed by the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), will provide additional funding.
According to P-CNGi Programme Director and Chief Executive Officer, Michael Oluwagbemi, the plant will establish a critical CNG supply hub for industries and residential users in the underserved northern region.
The collaboration will ensure stable, cost-competitive CNG supply, addressing the needs of sectors such as textiles, agriculture, and manufacturing. The project is expected to be operational within 12 to 16 months.
Mr Oluwagbemi said due to increasing demands to access gas for transportation and industrialisation, the President was determined to bring affordable transportation programmes by leveraging abundant gas resources and boost steady supply to the end users.
“Gas is cheaper, it is safer, and more reliable.
“Of course, the previous administration and this administration have been committed to moving gas from the region where it is primarily produced today, which is the southern part of the country, to the rest of the country.
“That is why the Nigerian National Petroleum Company Limited (NNPC Ltd.) and its partners have been investing in the Ajaokuta-Kaduna-Kano (AKK) gas pipeline.
“From the producing fields, the project will focus on a liquefaction plant and implant storage at Ajaokuta, and eventual pipeline trucks which will be able to move gas over further distances across the north of Nigeria,’’ he assured.
He said the conversion of LNG to CNG will present a wealth of opportunities for power plants, vehicles, and various industries in Northern Nigeria.
The project is poised to have a substantial positive impact on industries spanning textiles, agriculture, processing, and manufacturing
“The logistics, of course, of moving goods and food items from the north down to the south, especially, processed and manufactured products, will also be cheaper because of this project.
“And even more importantly, is that even when the north gets piped by natural gas in a few years’ time, this plant is still going to be very critical to enable LNG trucks that run more efficiently on LNG, even better than CNG.
“Those LNG trucks will begin to move Nigerian products from Nigeria to Ghana, and to Senegal, ensuring Nigerian products are very competitive and creating jobs,’’ he said.
Also speaking, Hajara Pitan, project director, LNG Arete, expressed appreciation to President Bola Tinubu, the management of P-CNGi and other enablers that ensured the reality of the agreement.
“A major reason for the lack of development of the gas sector has been the fact that infrastructure and gas is expensive, but with the mini LNG technology, we’re able to participate as Nigerians in this sector in a major way.
“Our aim is clear in LNG Arete to support the Federal Government in deepening gas utilisation across Nigeria, and especially in the underserved regions of northern Nigeria.
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“LNG is liquefied natural gas, and so what that means is that we take gas from where it originates, we liquefy it by reducing the quantity and allow it to move around more easily,’’ she said.
