Nigeria locks in $3.5bn gas projects as government targets $30bn

Nigeria has secured about $3.5 billion in committed investment in four major gas projects as the Federal Government steps up efforts to turn the country’s vast natural gas resources into a larger source of industrial activity, electricity supply and export earnings.

Minister of State for Petroleum Resources (Gas), Ekperikpe Ekpo, said the Iseni, Ubeta, HI and Ima projects had reached Final Investment Decision, with estimated investments of $122 million, $566 million, $2 billion and $800 million respectively.

The commitments form part of the government’s target of attracting $30 billion in new gas investment by 2030, making the latest FIDs an important test of whether Nigeria can convert its reserves into productive assets.

Ekpo said another $3.5 billion Brass Methanol project had moved closer to execution following the resolution of its Gas Sales and Purchase Agreement.

“These are not merely project milestones. They are evidence that responsible investment can create enduring domestic value, strengthen productive capacity, and generate employment,” he said.

The investment push is being supported by government spending on gas infrastructure. Ekpo said N671 billion deployed through the Midstream and Downstream Gas Infrastructure Fund had attracted about N1.6 trillion in private investment.

The fund covers 31 projects and 205 infrastructure assets, which are expected to deliver about 775 million standard cubic feet of gas per day to the domestic market when fully operational.

The figures are significant because increased domestic gas supply can reduce energy constraints facing electricity generators and industries, while providing feedstock for fertiliser, methanol, petrochemicals and other manufacturing activities.

The government is also trying to repair the financial relationship between gas producers and power generators. Ekpo said the National Economic Council had approved about N185 billion to settle validated debts owed to gas producers, some of which had remained unpaid for a decade.

Clearing the arrears is intended to restore commercial confidence in the gas-to-power market and improve the willingness of producers to supply gas to generating companies.

Nigeria’s gas production has increased from 6.8 billion cubic feet per day in 2023 to 7.5 billion cubic feet per day, with the government targeting 10 billion cubic feet per day by 2027 and 12 billion cubic feet per day by 2030. Domestic gas supply has already exceeded 2 billion cubic feet per day.

The country’s proven gas reserves also increased from 208.83 trillion cubic feet in 2023 to 215.19 trillion cubic feet in the January 2026 declaration by the Nigerian Upstream Petroleum Regulatory Commission.

Infrastructure remains central to unlocking those reserves. Ekpo said the Obiafu-Obrikom-Oben pipeline was fully completed and undergoing pre-commissioning, with the 2 billion cubic feet per day system expected to unlock more than 500 million standard cubic feet per day of additional domestic supply.

The Ajaokuta-Kaduna-Kano gas pipeline is about 95 per cent complete and is expected to be delivered in 2027.

Nigeria LNG’s capacity utilisation has also increased from 59 per cent in 2023 to 87 per cent, while Train 7 is expected to raise annual LNG production from 22 million tonnes to 30 million tonnes when completed.

The government is simultaneously expanding domestic gas use through compressed natural gas, with more than 120,000 vehicles reportedly converted and a target of one million CNG vehicles and 1,000 refuelling facilities.

For Nigeria, the economic importance of the gas investment drive lies in what happens after FID. New projects must translate into higher production, reliable gas for power and industries, more LNG and processed products for export and new jobs across the value chain.

With more than 215 trillion cubic feet of proven reserves, the constraint is increasingly investment, infrastructure and commercial discipline rather than the absence of gas.

The latest $3.5 billion commitments therefore provide another opportunity for Nigeria to turn its gas advantage into sustained industrial growth, stronger energy security and a broader source of foreign exchange.