In a compelling call for bolstered gas infrastructure and strategic investment, the Nigeria Extractive Industries Transparency Initiative (NEITI) has underlined the necessity for an estimated annual investment of $20 billion to fulfill the ambitious gas expansion projects in the country.
The clarion call was sounded during the ‘Decade of Gas Action Plan Dialogue,’ orchestrated by the African Initiative for Transparency, Accountability, and Responsible Leadership, and convened in Abuja on Tuesday.
Ogbonnaya Orji, the Executive Secretary of NEITI, emphasized the urgency of a deliberate and ambitious approach to gas infrastructure investment to facilitate the realization of the Federal Government’s gas utilization policy.
This envisioned strategy would encompass augmenting connectivity across the spectrum, encompassing upstream facilities to processing units, power plants, and various end users.
Orji noted that while the network code offers a framework for addressing connectivity challenges, bridging Nigeria’s gas infrastructure would necessitate a substantial annual investment of approximately $20 billion.
Addressing the evolving landscape of fossil fuel investments, Orji highlighted the importance of clarity in prioritizing infrastructure projects.
He asserted, “Given the shrinking fossil fuel investment landscape, clarity is required of the infrastructure to be prioritized.”
This emphasis aligns with the imperative to align Nigeria’s gas utilization policy with the nation’s energy transition plan.
Nigeria stands as Africa’s preeminent repository of gas reserves, ranking as the ninth largest globally.
Orji underscored this strategic advantage, stating, “The largest gas reserves in Africa are in Nigeria, as the country’s gas reserves are the 9th largest globally.”
He lauded the strides made by the Petroleum Industry Act in enhancing governance and establishing fiscal frameworks conducive to the sector’s expansion.
Urgent governmental action was urged by NEITI for the formulation of a comprehensive national gas utilization policy.
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This policy, NEITI stressed, should meticulously delineate the responsibilities of various stakeholders – industry, government, and investors – in executing the outlined plan.
Moreover, the policy should transparently present market-driven opportunities to effectively translate gas initiatives into sustainable economic development.
Orji advocated for a meticulously planned approach with pragmatic targets that can be easily executed.
Louis Ogbeifun, the Executive Director of the African Initiative for Transparency, Accountability, and Responsible Leadership, acknowledged the global trend of transitioning away from fossil fuels.
He advised the Federal Government to increase its short-term crude oil production to accumulate the necessary resources for diversification and investment in alternative sources.
While acknowledging the value of natural gas, Ogbeifun emphasized the challenges in shifting entirely from fossil fuels in the immediate future.
He queried, “Therefore, walking off fossil fuel for Nigeria is not immediately foreseeable. The question is, how does Nigeria maximize its hydrocarbon benefits with so much of its assets lost to vandalism, crude theft, and the massive depreciation of its currency?”
The emphasis on gas projects as a sustainable energy alternative is undeniable, albeit capital-intensive.
Observers have estimated that Nigeria’s pursuit of the 2060 zero-emission targets would necessitate over $1 trillion in investments.
In light of these projections, Ogbeifun advocated for meticulous planning and cost-effective strategies to finance these pivotal endeavors.
In summary, NEITI’s resounding call for $20 billion annual investments to catalyze Nigeria’s gas expansion endeavors underscores the imperative of a robust gas utilization policy overhaul.
This strategy, aligned with the nation’s energy transition plan, holds the key to maximizing Nigeria’s gas reserves, ensuring sustainable economic development, and navigating the challenges inherent in transitioning away from fossil fuels.
