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Natural gas

Nigeria's Gas Expansion: A Pivotal Opportunity for Regional Development

Strategic Insights

— 1 min read

Nigeria, endowed with vast natural gas reserves, is poised to reshape its economic landscape through the expansion of gas utilisation to the Northern region. Domestic gas consumption has surged to a 10-year high, with power generation accounting for 45% of the total. However, most of this growth has been concentrated in the South and West, leaving the North with limited access to natural gas infrastructure. The strategic expansion of gas utilisation to Northern Nigeria is expected to drive industrialisation, address energy deficits, and promote regional equity.

Key Takeaways:

  • Nigeria's domestic gas consumption hit a 10-year high in 2023, rising by 13.2% to 518.42 billion cubic feet, with power generation accounting for 45% of the total.
  • The Ajaokuta-Kaduna-Kano (AKK) Gas Pipeline, a 614-kilometer project, is designed to deliver pipeline-quality gas from the South to the North, catalysing industrial clusters, power plants, and commercial ventures.
  • The AKK pipeline project has made significant progress, with over 90% of the 303-kilometer stretch of the pipeline successfully laid by Oilserv Nigeria Limited.
  • The project's completion is expected to boost regional equity and national energy security, while promoting economic diversification.
  • Security challenges have been a major issue, with incidents leading to pauses in work and intensified security measures.
  • The project has employed over 2,000 workers at its peak, with a consistent record of respecting communities and maintaining positive relationships.
  • Oilserv Nigeria Limited has developed partnerships with various stakeholders, including the Nigerian military, police, and Department of State Services, to tackle security challenges.
  • The African Export-Import Bank (Afreximbank) has been a dependable ally, honouring Oilserv Group with the award of 'African Champion.'

Statistics:

  • Nigeria's domestic gas consumption: 518.42 billion cubic feet (2023)
  • Increase in domestic gas consumption: 13.2% (2023)
  • Power generation's share of domestic gas consumption: 45%
  • Length of the Ajaokuta-Kaduna-Kano (AKK) Gas Pipeline: 614 kilometers
  • Kilometers of pipeline laid by Oilserv Nigeria Limited: 303 kilometers
  • Number of workers employed by Oilserv Nigeria Limited at the project's peak: over 2,000

Sources:

  • Gas Exporting Countries Forum (GECF), Annual Statistical Bulletin 2024
  • ENR Advisory, Nigeria Report 2023 Gas Regulation
  • 24th NOG Energy Week (NOG) held in Abuja
  • Oilserv Group, African Champion award from Afreximbank

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