March 1, 2024

Nigeria to account for 24% of Africa’s oil, gas sector project by 2026 – Report

Solomon Ezeme

With over 400 oil and gas projects expected to commence operations in the African continent within the next 4 years, Nigeria is expected to execute about 109 (24%) within the period. This is according to a report by GlobalData, a data and analytics company, headquartered in London, England.

The report themed: “Africa Oil and Gas Projects Analytics and Forecast by Project Type, Sector, Countries, Development Stage, Capacity and Cost, 2022-2026”, revealed that, out of the 109 projects expected to commence operations in the country, petrochemicals would account for 14, upstream (fields) 26, midstream 31 and downstream (refineries) would have the highest amount with 38.

The report stated that more than 100 oil and gas projects are expected to commence operations in Nigeria in the next 4 years, accounting for 24% of the projected total projects, starting in Africa from 2022 to 2026.

Teja Pappoppula, an oil & gas analyst at GlobalData, said that the 109 projects are expected to help the nation become a net exporter of refined petroleum products, as the country is already considering revamping its dead refineries.

He described the Dangote 650 Thousand bpd (barrels per day) Refinery in Lekki, Lagos as one major refinery project that will help increase the quantity of available refined products in the country and for export whenever it commences operations.

He said, “Nigeria is mainly investing in oil & gas production, storage and refinery projects over the next five years.

“These upcoming projects would boost Nigeria’s economy and help the country to transform from an importer to an exporter of refined products, especially to neighboring countries.”

While noting that gas processing projects constitute the bulk of upcoming midstream projects with ANOH-Seplat, ANOH-SPDC and Brass being the key projects with a capacity of 300 million cubic feet per day each, Pappoppula stated that midstream projects will account for around 28% of total oil and gas projects in Nigeria by 2026.

The report further revealed that Nigeria, in line with its ‘Decade of Gas’ initiative and its decision to adopt gas as transition fuel, has started investing massively in gas projects nationwide, to gradually put to stop its current reliance on fossil fuel which has been largely criticized by the West due to its emission of carbon.

“The country is also making significant investments in natural gas processing, pipelines and liquefaction projects to reduce its dependence on oil, which currently drives the majority of revenue in the country,” the report stated.