Gas Outlook: Stakeholders propose financing strategies for development of Nigeria’s gas projects amidst global push against fossil fuel

Oredola Adeola

Stakeholders have proposed various financing options and strategies essential for the successful development of gas projects for Nigeria’s economic development and energy security, amidst a global push against fossil fuel financing and the country’s vast untapped gas reserves.

These options available for the development of gas projects in Nigeria were part of the suggestions shared by the experts at the Nigeria Oil and Gas Outlook, #nigeriaoilandgasoutlook held in Lagos on Thursday.

Ololade Shenbanjo, Oando Energies Business Development Manager, Commercial, while speaking during the panel session with the theme, “Nigeria in Focus; Making A Case for Funding Oil & Gas Projects in The Current Climate” emphasized that investment is coming into Nigeria despite corresponding access to funds to address investors’ appetite.

She also stated that Nigeria has an abundance of gas, and there is still fossil fuel funding.

According to her, oil and gas investors needed to be innovative with their project portfolio, in order to access the hydrocarbon-based funds.

She said that oil and gas projects must have a decarbonization angle, that is an environmental, social, and governance (ESG) angle, to ensure it is attractive for investors.

Shenbanjo, Oando Business Development Manager, Commercial also suggested that investors must focus on finding collaborative ways to continue their operations via joint development of assets, transport lines, etc, which will help them to spend less on capital investments.

Mr. Effiong Okon, the Director of New Energy at Seplat PLC, in his comment during the panel discussion on “Smart and Secured Energy Transition: Heading Towards Gas,” emphasized the pivotal role of the private sector in driving investment in the oil and gas sector.

He underscored the importance of the private sector taking the lead in investment, while urging the government to focus on policy development and ensuring compliance with environmental principles.

Sharing Seplat Energy’s transformative acquisition strategy, Okon stated that the company has been actively involved in driving Nigeria’s energy transition towards cleaner and more reliable energy sources.

This, according to him, has positioned itself for operational efficiency and strategic adaptation in the energy sector.

He noted that the company is presently building a new $250 million gas in Sapele, Delta state as part of the ongoing investment in the downstream sector to deliver Liquified Petroleum Gas (LPG) into the domestic market.

The Seplat Energy Director of New Energy also confirmed that the company’s JV gas processing facility in Imo will be completed by December and will be ready for commissioning by January 2024.

Felix Ekundayo, Managing Director, Asiko Energy Holding Ltd, during the session on his part expressed apprehensions regarding the dependability of foreign investments for downstream gas projects in Nigeria.

Ekundayo highlighted the necessity for investors to stimulate domestic institutional investment in order to enhance private sector funding for sustainable oil and gas ventures in Nigeria.

The MD Asiko Energy Holding Ltd therefore emphasised that the increased local currency capital will ensure the long-term viability for oil and gas investments in the country.

He further highlighted the importance of gas, which can be distilled into natural gas and LPG, comprising propane and butane.

According to him, “When we say gas, we are very blind about what we mean. Everybody understands petrol and diesel. kerosene but we don’t have that of gas.

“Gas can be distilled into two components, natural gas, and LPG, and within the LPG component, we have propane and butane, Nigeria needs to develop a policy for which one of the components. A kerosene policy does not work for gasoline,” Ekundayo said.