Nigeria seeks private sector support for gas infrastructure

Nigeria is taking steps to secure further public-private partnerships in order to develop infrastructure in the energy sector.

 

Nigerian Minister of State for Petroleum Resources Timipre Sylva held a meeting on October 15 with the Infrastructure Concession Regulatory Commission’s (ICRC) director general Chidi Izuwah on the topic. The primary area for such co-operation would be on gas pipeline construction.

“Everybody, the world over has come to realise that government is a bad manager and so everybody is … moving toward the private sector and PPP,” Sylva was reported as saying by the News Agency of Nigeria.

The country is working on the Abuja-Kaduna-Kano (AKK) pipeline and the more ambitious – and much less likely – Trans-Saharan Gas Pipeline (TSGP). Nigeria had been holding talks with Chinese investors on the AKK but Sylva said progress on this had slowed and the government appears to be losing faith. China National Petroleum Corp. (CNPC) had agreed to help secure funds for the $2.8 billion gas pipeline plan from Chinese lenders.

The minister will accompany Nigerian President Muhammadu Buhari – who also serves as the senior oil minister – on planned visits to Russia and Saudi Arabia, Sylva was reported as saying by ICRC. These foreign visits will include discussions on the AKK plan.

ICRC’s Izuwah was reported as mentioning that private capital could help play a role in restoring Nigeria’s four refineries.

The TSGP and a proposal to extend the West African Gas Pipeline (WAGP) to Morocco were also discussed as potential projects for ICRC. The TSGP has been on the drawing board for more than 10 years and involves the construction of a pipeline through Niger to Algeria. A front-end engineering and design (FEED) contract was awarded to Penspen on the proposal to build a 5,700 km gas pipeline to Morocco.

Nigeria has substantial gas resources and is working on plans for local expansion. A final investment decision (FID) is expected this month on a seventh train at Nigeria LNG (NLNG).

Chevron Nigeria signed a gas sale and aggregation agreement on the supply of feedstock to the Olorunsogo generation plant last week. A statement on the deal noted the importance of gas as a means to tackle Nigeria’s power challenges.

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