Abuja: The Presidential Compressed Natural Gas Initiative (P-CNGi) and LNG Arete Ltd. have signed a Memorandum of Understanding (MoU) to initiate a $27.3 million gas plant project aimed at enhancing Compressed Natural Gas (CNG) infrastructure investment, expansion, and availability.
According to News Agency of Nigeria, the Programme Director and Chief Executive Officer of P-CNGi, Mr. Michael Oluwagbemi, stated that the partnership focuses on constructing a Liquefied Natural Gas (LNG) plant with a processing capacity of seven million standard cubic feet per day (MMSCFD). This endeavor involves a co-investment where P-CNGi will contribute six million dollars alongside LNG Arete's $12 million investment, with additional support from the Midstream Downstream Gas Infrastructure Fund under the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA).
Oluwagbemi highlighted that the project is expected to employ over 100 Nigerians and will accelerate CNG infrastructure development in the north, securing a 25 percent equity stake in LNG Arete's seven MSCFD mini LNG facility located in Ajaokuta, Kogi State. The gas plant is projected to become operational in the next 12 to 16 months, establishing a critical supply hub for CNG across Northern Nigeria and beyond.
He emphasized the project's role in ensuring a stable, cost-competitive CNG supply for industry and residential users in the underserved northern regions. The initiative aligns with the President's determination to leverage abundant gas resources to provide affordable transportation programs and boost a steady supply to end users. Oluwagbemi noted that gas is cheaper, safer, and more reliable, and that both the current and previous administrations have been committed to expanding gas infrastructure across the country.
The project will focus on a liquefaction plant and implant storage at Ajaokuta, with eventual pipeline trucks capable of transporting gas over long distances across the north. The LNG, which will be transformed into CNG, is intended for use by power plants, vehicles, and various industries, thereby boosting industrialization.
The P-CNGi CEO also mentioned that the project will significantly benefit industries across the north, including textile, agriculture, processing, and manufacturing sectors. Additionally, the logistics of moving goods and food items from the north to the south will be more cost-effective, enhancing the competitiveness of Nigerian products and creating jobs.
Hajara Pitan, Project Director at LNG Arete, expressed gratitude to President Bola Tinubu, the management of P-CNGi, and other stakeholders for making the agreement a reality. She noted that the expensive nature of infrastructure has historically hindered gas sector development, but the mini LNG technology allows greater participation in the sector. LNG Arete aims to support the Federal Government in deepening gas utilization across Nigeria, particularly in the underserved northern regions.