The federal government of Nigeria has reiterated, on October 16, its ambitious target of 10 billion standard cubic feet (SCF) daily gas production by 2030. The target is part of Nigeria’s aspirations for energy security and industrial development.
Wale Edun, Finance Minister and Coordinating Minister of the Economy announced the target during a Strategic meeting in Abuja with Nigeria LNG Limited (NLNG) Edun further explained how the administration was working to improve the risk-reward equation and creating a conducive enabling environment for investors., specifically note how the government is reforming the market to create a transparent marketplace for gas. Other considerations included the creation of digital trading systems, and tax and incentive proposals that minimize inefficiencies and restore investor confidence in Nigeria’s energy sector.
According to the Nigerian Upstream Petroleum Regulatory Commission, Nigeria produces approximately 7.6 billion SCF daily gas which indicates that the 2030 target will require some capital investments in infrastructure, followed by some assurance of stability and reliability of gas supply in Nigeria. The Government recently entered into significant agreements with international oil companies including a deepwater agreement with TotalEnergies where Edun pointed out the deepwater agreement is evidence of improved investor confidence in Nigeria.
Dr. Philip Mshelbila, Managing Director at NLNG detailed the potential improvements in the supply and security of gas along critical pipelines, the plants utilization rates are also better than the 70% target. NLNG also has continuing strategic projects (the completion of the Bodo-Bonny Road) which should facilitate logistics; Edun indicated grievance in extending the east-west tax credit to support gas operating companies.
Also, in an industry-wide perspective, stakeholders cited achieving the target of 10 billion SCF/day will improve power generation, increase fertilizer and petrochemical production and improve a chronic energy deficit in the Nigeria economy. They do maintain some hurdles are in play, particularly, the pipelines, processing facilities and continual need for protecting against security risks and endemic crime challenging essential assets.
Increasing gas output is central to President Bola Tinubu’s Renewed Hope Agenda to boost the economy with reforms in the sector and associated infrastructure. Stakeholders overall expressed collective views that the 2030 target represents a game changer for Nigeria’s energy and economic agenda, which is now evolving and in better alignment with fair operational governance.