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Tag: Compressed Natural Gas (CNG)

  • MAN Raises Alarm Over US-Iran Crisis, Warns of Severe Impact on Nigeria’s Manufacturing Sector

    MAN Raises Alarm Over US-Iran Crisis, Warns of Severe Impact on Nigeria’s Manufacturing Sector

    The Manufacturers Association of Nigeria (MAN) has expressed deep concern over the escalating geopolitical tensions involving the United States, Israel, and Iran, warning that the crisis poses significant risks to Nigeria’s manufacturing sector and broader economic stability.

    In a position statement, MAN noted that the intensifying conflict in the Middle East has already sent shockwaves across the global economy, disrupting energy markets, shipping routes, and supply chains. The association cautioned that although the conflict is geographically distant, its economic consequences could have direct and far-reaching implications for Nigeria’s industrial base.

    According to MAN, the crisis comes at a delicate time for Nigeria’s economy, just as inflation had begun to moderate to 15.10 percent and manufacturing capacity utilization showed signs of recovery above the 60 percent threshold. The association warned that these gains are now under threat from rising global uncertainties.

    MAN highlighted that disruptions in critical transit corridors, particularly around the Strait of Hormuz and the Red Sea, have triggered sharp increases in global oil prices, freight costs, and war-risk insurance premiums. Brent crude prices have surged beyond $84 per barrel, while shipping vessels are increasingly rerouting, leading to higher logistics costs and longer delivery timelines.

    The association stressed that for Nigerian manufacturers, global geopolitics now translates directly into increased production costs. It explained that while higher oil prices could theoretically boost Nigeria’s foreign exchange earnings, the country’s limited crude production capacity—currently between 1.3 and 1.4 million barrels per day—means it is unable to fully capitalize on these gains.

    MAN further warned that the crisis could disrupt Nigeria’s trade relationship with the United States, one of its key trading partners. With exports to the US valued at $5.91 billion in 2024 and imports at $4.33 billion, any disruption in trade flows could exacerbate supply chain challenges and increase the cost of imported raw materials.

    The association outlined several immediate implications for the manufacturing sector, including escalating energy costs, rising freight expenses, and increasing imported inflation. Manufacturers, it said, are already grappling with soaring diesel and gas prices, which are eroding operating margins. At the same time, declining consumer purchasing power is reducing demand, leaving companies with unsold inventories.

    MAN identified the chemical and pharmaceutical sector as the most vulnerable, noting its heavy dependence on petroleum-based inputs and its dominance in manufactured exports to the United States. The basic metals, iron and steel sector, as well as the food, beverage, and tobacco segment, were also highlighted as particularly exposed due to their reliance on energy and imported inputs.

    Drawing parallels with the economic fallout from the US-Iraq War, MAN recalled that Nigeria’s manufacturing sector experienced severe setbacks during that period. Manufacturing exports fell sharply from $901.35 million in 2002 to $496.87 million in 2003, while sectoral GDP growth plunged from 17.74 percent to -10.8 percent.

    The association warned that a similar trajectory could unfold if proactive measures are not taken, emphasizing Nigeria’s continued vulnerability to external shocks due to its dependence on imported raw materials.

    To mitigate the impact, MAN called on the Federal Government to urgently implement targeted interventions. These include accelerating the adoption of compressed natural gas (CNG) for industrial use, establishing a dedicated foreign exchange window for manufacturers, prioritizing domestic supply of refined petroleum products to local industries, and suspending logistics and haulage levies to ease transportation costs.

    MAN stressed that the current crisis presents a critical opportunity for Nigeria to strengthen its manufacturing base and reduce dependence on external inputs. It urged policymakers to act decisively to protect jobs, sustain production, and safeguard economic stability.

    “The time for reactive measures has passed. This moment calls for deliberate and strategic action to fortify Nigeria’s manufacturing sector against external shocks,” the association stated.

  • Driving Africa’s Low-Carbon Future: Dangote Cement Commits to 100% CNG Fleet

    Driving Africa’s Low-Carbon Future: Dangote Cement Commits to 100% CNG Fleet

    … targets 29% emissions cut, invests ₦12.4B in Community Development in 2024

    As part of its bold moves aimed at reducing greenhouse gas emissions and improving energy security, Africa’s leading cement manufacturer, Dangote Cement Plc has disclosed it has so far co-processed over 1.5 million tonnes of alternative fuels in the four years thus significantly lowering its carbon footprint.

    The move underscores the company’s commitment to cutting carbon emissions, enhancing energy security, and setting a benchmark for sustainable industrialization across Africa.

    Speaking to global audience at the Africa CemTrade Summit which just ended in Accra, Ghana, the Group Managing Director of Dangote Cement, Mr. Arvind Pathak said since 2021 when the Company embarked on energy diversification, it has successfully deployed 15 alternative fuel systems across its plants, achieving up to 40 per cent thermal substitution in operations across its plants in sub-sahara Africa especially in Senegal, Zambia, and South Africa.

    Pathak who spoke on the theme, theme “Sustainable Innovation in the Sub-Saharan Africa Cement Distribution Value Chain,” said with the shift to Alternative Fuel, his cement Company has been converting industrial, agricultural, and municipal wastes into energy, noting that the initiative forms part of the company’s broader decarbonisation target aimed at cutting carbon emissions by twenty per cent by 2030.

    He emphasized that Dangote Cement which has expanded its footprint across eleven countries, with a production capacity of 55 million tonnes annually, is leading a transformative shift towards sustainability in Africa’s cement distribution sector, combining environmental stewardship with profitability pointing out that sustainability sits at the core of the company’s business model, influencing every aspect from production to logistics.

    Pathak explained that central to its green transition programme was the Investment in compressed natural gas (CNG) logistics which have seen Company acquired over 3,000 CNG trucks and 1,000 dual-fuel vehicles deployed, significantly reducing emissions and transport costs. The company aims for a fully CNG-powered fleet in Nigeria by 2026, targeting a 29 per cent reduction in carbon emissions per energy unit consumed.

    Dangote Cement’s sustainability strategy is further supported by its digital transformation drive, which has introduced systems such as the Distributor Management System (DMS), Transport Management System (TMS), and Electronic Proof of Delivery (e-POD), enhancing transparency, route optimisation, and supply chain efficiency.

    According to him, the company has mapped more than 65,000 retail outlets in Nigeria and continues to expand across key regional trade corridors. Through its Customer Truck Empowerment Scheme (CTES), Dangote Cement has distributed over 4,000 trucks to transport partners, creating jobs and improving reliability in cement delivery.

    In 2024 alone, the company invested over N12.4 billion in community development projects across its host countries, a fourfold increase from the previous year, covering education, healthcare, infrastructure, and youth empowerment.

    As Dangote Cement continues to invest in low-carbon operations and innovative technologies, it sets a benchmark for sustainable industrialization across Africa.

    “Dangote Cement Plc has taken the lead in driving sustainable transformation across the Sub-Saharan Africa’s cement value chain. We are reaffirming our commitment to innovation and responsible growth. Sustainability has never been an afterthought for us; it is central to how we grow, innovate, and operate,” he stated. For Africa’s industrial future to remain viable, sustainability must make economic sense. Our strategy ensures profitability while protecting the planet.”

    The Dangote Cement CEO said the Company has over the past two decades, Dangote Cement expanded from a local producer into a continental leader, operating in eleven countries with an installed capacity of 55 million tonnes per annum. Beyond scale, Pathak said, the company’s distinction lies in its deliberate shift towards lower-carbon operations, contributing to Africa’s sustainable industrialisation.

    Said he: “We recognised early on that sustainability would shape the future of manufacturing. Our investments in process optimisation, cleaner fuels, and advanced energy systems are helping us reduce waste, improve efficiency, and build stronger competitiveness. We are proving that economic performance and climate responsibility can move together.”

    Dangote Cement continues to play an active role in global and regional partnerships for sustainable construction as a founding member of the Global Cement and Concrete Association (GCCA) and a partner of the United Cities and Local Governments of Africa (UCLG Africa) to promote low-carbon cement standards, including the Limestone Calcined Clay Cement (LC3) initiative.

    In her remark at the event, Dangote Cement’s Deputy Head of Sustainability, Oyekemi Oyelola said the company’s model demonstrates that industrial progress and environmental responsibility can coexist.

    “We see a future where Africa’s cement industry becomes a benchmark for sustainable industrialization globally. Our mission is to ensure that Dangote Cement leads that transformation, driving innovation, creating value, and helping Africa build not only stronger structures but a stronger, greener future.”

  • Seplat Energy Ties Africa’s Prosperity to Domestic Gas Development

    Seplat Energy Ties Africa’s Prosperity to Domestic Gas Development

    Seplat Energy Plc, a leading Nigerian independent energy company, says that domestic gas remains the engine of prosperity for Nigeria and Africa in general – from powering homes, to fuelling industry and providing a cleaner alternative for cooking and transportation. This informed the company’s heavy investment in gas processing capacity devoted to the domestic market, including the ANOH gas plant, which is expected to come on stream before the end of the year. 

    The Director, New Energy at Seplat, Mr. Okechukwu Mba, said this at the 2025 Africa Energy Week (AEW) held in Cape Town, South Africa. Mba, who spoke during a panel discussion titled “Beyond Exports: Developing Commercially Viable Domestic Gas Markets”, said stakeholders need to ensure that the challenges in the gas-to-power value chain, from molecules at the wellhead to electrons in homes, are addressed for Nigeria to realise the goal of increased power supply to Nigerians. He also emphasised the importance of a commercially viable power sector, which is critical to achieving growth in the domestic gas market. 

    He said: “Bankable anchor customers are needed to underpin the development of new gas projects, whilst identifying infrastructural challenges in power transmission and distribution, as well as the liquidity crises in the power sector, as two areas that require urgent attention to unlock new gas projects. Mba highlighted that Seplat Energy supplies gas to five (5) power stations in Nigeria, underscoring its commitment to the power sector, noting that gas is well-positioned to provide reliable and affordable base-load energy to drive economic growth.

    According to Mba, Seplat Energy adopts a comprehensive approach to growing the domestic gas market.  “Besides investments in pipeline gas projects, Seplat is also investing in Liquefied Petroleum Gas (LPG) and Compressed Natural Gas (CNG) facilities,” he added.

    In addition to the significant volumes of butane now supplied to the domestic market from its NGL plant in Bonny River Terminal, Seplat Energy also intends to commence delivery of LPG from its Sapele and ANOH gas plants before the end of the year. This, Mba said, will make Seplat Energy one of the leading suppliers of LPG, displacing biomass and providing a cleaner cooking fuel that will improve Nigerians’ health and living conditions. He added that Seplat Energy’s investment in CNG was to make gas available to customers who are not currently connected to the domestic gas pipeline network.

    The Seplat New Energy boss stated that the company plans to increase its operated gas production to over 1 Bcf/d by 2030, noting that the recent government incentives granted to the gas sector will aid in achieving this goal. 

    In a related development, the Director External Affairs & Social Performance, Seplat Energy, Chioma Afe, who featured in a panel discussed dubbed “Bureaucracy or Bridge? Tailoring Global ESG Approaches for African Realities”, said in all the company’s moves in driving to drive access to reliable and affordable energy for Nigerians, ESG fundamentals are strongly upheld and practicalised.  

    According to her, the peculiarities of the Nigerian people and Africa at large remain very germane in implementing Seplat Energy’s ESG framework and affirming its commitments.

    She said: “For a truly successful and impactful ESG implementation, it is highly imperative to move from a ‘one size fits all’ mindset to a co-created framework and implementation that is focused on value creation and empowers African nations to define their own sustainable growth plan. One that ensures ESG principles become a bridge across industries and countries, driving growth and not a bureaucratic exercise.” 

    “Adapting ESG to local needs is key. Therefore, we should explore customising global ESG frameworks to address the unique socio-economic conditions, developmental challenges, including infrastructure, education and healthcare, and vulnerabilities to climate change and economic empowerment, across the continent.”

     Speaking to the company’s model, she noted that: “At Seplat Energy, our approach has been a regular and systematic process of identifying and analysing the development ‘gaps’ in our areas of operation and partnering with our communities to define project goals, prioritise resources and develop effective strategies to achieve them.”

  • Gas must replace dirtier fuels to drive energy transition in Africa – NLNG MD

    Gas must replace dirtier fuels to drive energy transition in Africa – NLNG MD

    The Managing Director and Chief Executive Officer of NLNG, Philia Mshelbila, on Wednesday, called for deliberate efforts for the displacement of dirtier fuels, like biomass, by natural gas to drive energy transition in Africa.

    Mshelbila made the call during a panel session titled “Diversity of Gas Development Globally” at the 29th World Gas Conference in Beijing, China which held from 19th May to 23rd May 2025.

    He remarked that the most important factors for energy, especially natural gas, were availability and affordability, stressing the need to solve infrastructure challenges to ensure that critical energy is getting to where it’s needed, at affordable rates.

    “Today, Africa’s population is about 1.4 billion, and most people still use biomass for cooking and liquid fuels for transportation. Power generation comes from a mix of hydro, natural gas, and, in many cases, diesel. This is where natural gas has a major opportunity, to displace dirtier fuels. Africa’s population is expected to grow to 2.5 billion in the next 25 years, adding over a billion people. For the existing population, we need to shift from biomass to gas. For the next billion, we must ensure that natural gas becomes the primary energy source before transitioning to renewables. But none of this will happen without solving access and affordability,” he said.

    Mshelbila emphasised the significance of Nigeria’s Decade of Gas initiative as a strategic pathway for replacing high-emission fuels with cleaner low carbon fuels.

    “The Decade of Gas is Nigeria’s strategic roadmap to replace high-emission fuels with cleaner, more affordable gas solutions. Gas is not just a bridge; it is a foundation for achieving energy access, industrialisation, and environmental sustainability.

    “For the past 25 years, there’s been significant focus on exports because the country needed the revenue, which is critical for development. However, domestic utilisation has lagged. The Decade of Gas looks at supply, demand, infrastructure, and commercial frameworks to unlock gas utilisation. Considerable work has gone into removing bottlenecks and challenges that have hampered gas utilisation, both for domestic use and export.

    “One example is the push for Compressed Natural Gas (CNG) in transportation, which is now gaining momentum. Another focus area is LPG, which NLNG has spearheaded. We have decided that our production of over 500,000 tonnes per annum will be entirely deployed for domestic use. The goal is to displace biomass and kerosene used for cooking. This isn’t just about the cleanliness of natural gas, it’s also about addressing health issues related to indoor air pollution, which causes over 100,000 deaths annually among women and children. All these aspects are part of the Decade of Gas initiative. Our aim is that by 2030, we will have significantly increased natural gas utilisation to displace dirtier fuels and create a new foundation for future growth,” he added.

    Addressing the continent’s diverse energy landscape, Mshelbila underscored the need for localised solutions. He said while countries such as Nigeria, Algeria and Egypt possess abundant reserves, gas utilisation rates remain low due to a lack of enabling infrastructure and policy clarity.

    He called for deliberate policies to foster infrastructure expansion, local content development, and innovation.

    “From a developing world perspective, I believe it starts with creating the right investment environment. We speak from real experience here. Although we have had natural gas for decades, it was only last year, as part of the Decade of Gas initiative, that we established clear fiscal terms for deepwater gas. Before that, investors took on significant risks because the fiscal terms weren’t defined. This is a clear example of government providing necessary clarity, so investors know exactly what they’re committing to.

    Mshelbila stated that infrastructure development could be driven by policy and emphasised that the right investments could promote gas infrastructure expansion. On pricing, he expressed complete opposition to government price regulation. However, he acknowledged that significant vulnerable populations in the developing world needed protection. He stressed the importance of ensuring affordability and access to natural gas for these groups.

    On the conversation on energy transition and sustainability, he stated that policy played a crucial role, noting that policies varied globally with the EU leaning toward regulation and the US favouring incentives. He added that there was a role for policy in stimulating the energy transition appropriately, though the approach would differ across regions.

    Mshelbila was on the panel with Jack Fusco, President and CEO of Cheniere, U.S.A, Peter Wong, Managing Director of Hong Kong and China Gas Company Limited and Andrea Stegher, Senior Advisor at SNAM and Vice President of the International Gas Union, organisers of the conference.

  • Seplat Energy Canvasses Improved Energy Access for Nigeria’s Development

    Seplat Energy Canvasses Improved Energy Access for Nigeria’s Development

    Seplat Energy Plc, foremost indigenous energy company, says Nigeria’s development will require significant improvements in access to energy. According to the Company, lower-cost, more reliable energy will drive job creation, prosperity and social development and achievement of the United Nations’ Sustainable Development Goals (SDGs).

    The Chief Executive Officer, Seplat Energy Plc, Mr. Roger Brown, said this while delivering the Keynote Address at the ongoing 42nd Nigerian Association of Petroleum Explorationists (NAPE) Annual Conference & Exhibition, happening in Lagos. Mr. Brown, who was represented by the Director, New Energy at Seplat Energy, Mr. Okey Mba, spoke on the Conference theme: Resolving the Nigerian Energy Trilemma: Energy Security, Sustainable Growth and Affordability.

    According to him, Nigeria must improve energy access and achieve a balance between equity, security and sustainability; as the country faces the challenges of population growth and lack of economic and social development because of poor energy access.

    “Nigeria’s development will require significant improvements in access to energy. With gas, significant development gains can be achieved with minimal impact on emissions. The country must transition away from reliance on biomass and oil as its primary sources of energy,” he stressed.

    The Seplat Energy boss made a strong case for gas as Nigeria’s transition fuel; saying it is proven and accepted as transition fuel in developed North with large local resources in Africa (Nigeria having the largest) and multiple essential uses beyond power.

    Mr. Brown explained that Nigeria’s abundant gas reserves offer a local solution to resolving the country’s energy trilemma; given that as gas is developed it is likely the reserves will grow materially. Nigeria has estimated 209 Tcf of reserves by many experts believe it is 2 to 3 times that amount.

    “Nigeria’s estimated 40GW(plus) power generation sets (gensets) could be displaced by cleaner, cheaper utility-scale gas and renewables. Every gigawatt (GW) of generator power displaced by cleaner utility-scale gas will decarbonise Nigeria’s energy system and reduce the cost of energy. Our industry must focus on end-to-end solutions to unlock the full value of Nigeria’s gas so we can resolve the energy trilemma,” he added.  

    Seplat Energy’s focus is on supporting more power generation, reducing emissions and creating new gas product lines with its joint venture investments aimed at enhancing capacity at the ANOH and Sapele gas plants, and so on.

    Seplat’s JV investments in gas will deliver significant value for all stakeholders, as the company leverages new business lines in Liquefied Petroleum Gas (LPG) and Compressed Natural Gas (CNG), and decarbonizing its operations through reduced flaring and diesel replacement.  

  • Nigerian Police Partners NASENI To Boost Operational Efficiency

    Nigerian Police Partners NASENI To Boost Operational Efficiency

    The National Agency for Science and Engineering Infrastructure (NASENI) has expressed its commitment to refurbish and revamp redundant operational assets of the Nigerian Police Force (NPF) such as vehicles, helicopters, amongst others.


    This is part of moves to support the Police Force in boosting its operational capacity to improve the security situation in the country in line with President Bola Ahmed Tinubu’s Agenda on Security. 


    The Executive Vice Chairman and Chief Executive Officer (EVC/CEO) of NASENI, Mr. Khalil Suleiman Halilu made the pledge during a meeting with the Inspector General of Police (IGP), Mr. Kayode Egbetokun, Ph.D when he paid him a visit at the Force Headquarters on Friday, February 2, 2024. 


    The NASENI boss said the Agency would mobilise and deploy financial and technical resources needed to retool, upgrade and modernize the NPF Vehicle Maintenance Workshops nationwide as well as recover, repair and reactivate all police vehicles that are not functional.


    In so doing, he mentioned some of the benefits to be achieved including: Improved security and compliance to climate change action as NPF vehicles are converted from petrol and diesel to electric and compressed natural gas (CNG). 


    Other benefits to be derived are that the project would support local content efforts by prioritising the use of locally manufactured materials, Opportunities for skill acquisition and job creation and Commercial returns to sustain ongoing maintenance of Police assets.


    In his remarks, the Inspector General of Police, said the collaboration between NASENI and the NPF will go a long way in positively impacting the operations of the Police Force, its security architecture and overall service delivery. 


    Mr. Egbetokun further assured of the cooperation of the Nigeria Police Force towards providing the necessary support to NASENI to deliver on its mandate.

  • AGM: Dangote Cement promises higher returns, value to shareholders, stakeholders

    AGM: Dangote Cement promises higher returns, value to shareholders, stakeholders

    Chairman of Dangote Cement Plc, Aliko Dangote has guaranteed shareholders and other stakeholders of the company’s management’s resolve to keep the company profitable by leveraging on strategic innovations to continuously grow their investments.

    Speaking at the 14th Annual General Meeting (AGM), of the company in Lagos, Dangote said the prospects for the cement company remain bright as the management will continue to innovate on quality products delivery to millions of its customers across Africa while touching the lives of its host communities.

    He stated: “We will continue to make sure that we keep our shareholders happy, not only the shareholders but all our other stakeholders… Our strategy remains steadfast, focused on organic growth in Nigeria and Pan-Africa while ensuring that Africa’s regional integration becomes a reality. We will continue to contribute to improving regional trade within Africa by building plants across West and Central Africa, guided by our vision of making the region cement and clinker self-sufficient. In addition, we aim to deliver higher returns and value to our shareholders.”

    The Chairman pointed out that despite the challenging macroeconomic environment in 2022, the company still made great strides, performed admirably, and remains Africa’s largest and leading cement producer.

    Dangote explained that in the face of unexpected challenges in 2022, the company implemented robust cost reduction strategies to manage the inflationary environment, and thus enhanced its competitiveness while maintaining high levels of product quality and customer service delivery.

    According to him: “In addition, we achieved giant strides in transitioning to cleaner energy, with our cost containment initiative propelling the use of Alternative Fuel (AF) to replace more expensive fossil fuels, such as coal and gas. We also increased our trucks’ use of Compressed Natural Gas (CNG) due to the rising diesel cost environment.

    These efforts have helped us reduce our cost base and enhanced our flexibility, enabling the Company to respond more effectively to changes in the market. As a result, we recorded revenue and EBITDA growth of 17.0 per cent and 3.5 per cent from the prior year respectively, albeit under unprecedented inflationary pressure. We also achieved a profit after tax of ₦382.3 billion, up 4.9 per cent compared to 2021.”

    Analysing the 2022 year-end result, Dangote explained that the company achieved its highest revenue and earnings before interest, taxes, depreciation, and amortization (EBITDA) in history at ₦1,618.3 billion and ₦708.2 billion, respectively. The exceptional EBITDA, according to him, was supported by its numerous cost containment measures, substituting higher-cost fuel for cheaper alternative fuel products.

    The Company Chairman explained that: “Over the last twelve years, volumes have grown by a double-digit compound annual growth rate of 11.2 per cent. Similarly, EBITDA has grown at a compound annual growth rate of 16.3 per cent, over the same period, implying a five-fold increase and revealing a true growth story.

    “Accordingly, we closed the year with a profit after tax of ₦382.3 billion and an Earning per Share (EPS) of ₦22.27. Despite these accomplishments, we are not resting on our laurels. We recognise that the business environment remains volatile, so we will continue to evolve with the changing times while embracing technological advancement,” he added.

    Speaking on the Company’s Annual Reports, Mrs. Bisi Bakare, Chairman of the Pragmatic Shareholders Association, commended the management of Dangote Cement for its doggedness during the year under review for still being able to exceed the shareholders’ expectation in view of the inclement economic weather under which companies operated in the country.

    She explained that the shareholders were happy for the returns, pointing out that it only means that the company was living up to its billing as the largest in Sub-Saharan Africa, adding that if not for the resilience of the management, the company would not be able to post such an impressive performance in 2022. 

    Mrs. Bakare alluded to the successful listing of the N300 billion series bond by the Company, saying the company succeeded largely due to the confidence reposed in the company and its management by the investing public. “It is not all companies that could record such a feat given the huge amount involved and the biting economic situation”, she stated.

  • Feature- Nigeria and African Energy Poverty and Gas-To-Power Projects: Build More and Build Better

    Feature- Nigeria and African Energy Poverty and Gas-To-Power Projects: Build More and Build Better

    By NJ Ayuk

    As the executive chairman of the African Energy Chamber (AEC), it’s my honor and my privilege to tell the world the story of Africa’s oil and gas industry – to explain what this continent can do to help power the world and fuel its own future. But it’s also my mission to talk about African energy poverty and to explain why this continent needs better access to energy now in order to illuminate its own potential and power forward.

    To illustrate the issue of energy poverty in general, I’d like to focus on energy poverty in Nigeria in particular.

    Within Africa, Nigeria is an interesting subject. It’s the most heavily populated country in Africa, with more than 200 million citizens. It surpassed South Africa to become the continent’s largest economy about a decade ago, and its GDP topped USD441.5 billion in 2021. It has the largest crude oil reserves in sub-Saharan Africa and is typically the largest liquids producer in the region, though output figures have slumped this year due to problems with theft and sabotage. Likewise, it has sub-Saharan Africa’s biggest reserves of natural and associated gas and is far and away the region’s biggest gas producer.

    Nigeria also experiences significant energy poverty, despite these advantages. As noted in the AEC’s recently released report, “The State of African Energy: 2023 Outlook,” consistent access to modern energy services – that is, steady and reliable electricity supplies – is available to only 60% of the country’s population on average, and access rates appear to be significantly lower in rural areas than they are in urban areas. And according to World Bank data, about 99.9 million people, or more than 47% of Nigeria’s population, lived in rural areas as of the end of 2021. That means nearly 100 million Nigerians are living without any true level of certainty that the lights and the electric power that so many in the developed world take for granted will stay on.

    I, for one, think they deserve to have that certainty.

    They deserve it on human grounds, and their country already has a significant amount of what is needed to provide them with it. And by that, I mean that Nigeria has gas that it could use to generate power.

    What Nigeria Has

    As I’ve already noted, the country’s gas resources are the largest in sub-Saharan Africa. Nigeria has already been shown to have more than 200 trillion cubic feet (tcf) of gas in proven reserves, and government officials believe that the figure could go even higher, perhaps reaching 600 trillion cubic feet (tcf) following additional exploration.

    If that prediction comes true, Nigeria will have the fourth largest gas reserves in the world, behind only Russia, Iran, and Qatar. It will have more than enough gas to meet current demand; it will have enough gas to produce significant volumes of LNG for export while also supporting gasification programs, both on the domestic and regional levels.

    But it’s not enough just to have all that gas. Nigeria also needs the means to make use of its gas. Without the proper infrastructure, it won’t be able to put its resources to work and will merely have a scattered collection of raw materials.

    What Nigeria Needs

    In practical terms, this means that Nigeria ought to have the following:

    • Upstream production facilities for gas.
    • Midstream gas transportation facilities such as pipelines, including field networks and trunk lines.
    • Downstream gas-processing plants and production facilities for gas-derived fuels such as liquefied natural gas (LNG), compressed natural gas (CNG), and liquid petroleum gas (LPG).
    • Downstream gas distribution systems, including town gas networks.
    • Downstream gas storage depots.
    • Gas-fired thermal power plants (TPPs) – preferably co-generation plants, as they are more efficient.
    • Transmission, distribution, and storage infrastructure for the electricity produced by gas-fired TPPs.
    • Smart and secure operational technology (OT) systems that can optimize the flow of data and resources between consumer markets and energy networks

    I’m not suggesting here that it’s the Nigerian government’s job to provide all this infrastructure. But I do believe that it’s Abuja’s responsibility to make sure that this infrastructure becomes available. To this end, I think that Nigeria also needs government bureaucracies that are competent and trustworthy enough to ensure that oil-, gas-, and power-related contracts are only awarded to companies capable of providing the goods and services required within the acceptable parameters.

    What Nigeria Envisions

    Developing this infrastructure requires the right kind of vision, which Nigeria already has in place: its “Decade of Gas” program is designed to make the country entirely gas-powered by 2030.

    When President Muhammadu Buhari rolled out this initiative in March 2021, he indicated that it aimed to make the gas sector the cornerstone of Nigerian economic activity. By the time the “Decade of Gas” comes to an end, he said, the country will have done the following:

    • Adopted a new oil and gas law to facilitate investment.
    • Carried out new exploration projects, discovered new reserves, and brought new fields onstream.
    • Constructed new gas-processing plants and production facilities for LPG and other gas-derived fuels.
    • Built new export pipelines and constructed new production trains at gas liquefaction plants such as Nigeria LNG (NLNG).
    • Constructed new domestic pipelines along routes to serve local customers plus gas-fired thermal power plants (TPPs) to increase domestic electricity supplies.
    • Expanded domestic power transmission and distribution networks, especially in rural areas.

    Nigeria still has a significant amount of ground to cover before it achieves all of these targets. However, it has made progress. The biggest example of this is the Petroleum Industry Act (PIA), which Buhari signed into law after it passed both houses of the National Assembly. The Nigerian government is also successfully promoting LPG, a gas-derived fuel, as a replacement for wood and charcoal as cooking fuel. (According to NLNG, domestic LPG consumption has climbed by around 1,000% over the last 14 years.)

    And as recently as this November,  Nigeria moved closer to building its first floating liquified natural gas (FLNG) facility. Nigerian company UTM Offshore signed a front-end engineering design (FEED) contract to design the facility with JGC Corporation, Technip Energies, and KBR. Chief Timipre Sylva, Minister of Petroleum Resources, Nigeria, described the project as a step in the right direction for Nigeria to develop, exploit, and monetize its natural gas.

    During the African Energy Week in Cape Town, Amni International Petroleum Development Company Limited, a Nigerian independent oil and gas exploration and production company and the African Export–Import Bank (Afreximbank) signed an agreement for the provision of a $600 million syndicated reserve-based lending facility.

    To a lesser extent, Abuja can also claim credit for the headway it has made on the Ajaokuta-Kaduna-Kano (AKK) pipeline, which is being built to bring gas to the northern part of the country. When finished, the pipeline will deliver fuel to gas-powered industrial facilities and feedstock to TPPs with a generating capacity of 3,600 MW. It may also serve eventually as the first leg of the Trans-Saharan Gas Pipeline (TSGP) network, which will allow Nigeria to export gas to Europe via Algeria. Unfortunately, though, the project has been running behind schedule, and the heavy floods that began hitting many parts of the country in mid-2022 have caused additional delays.

    In the meantime, Abuja has also moved forward with plans for establishing another gas export network – the Nigeria-Morocco Gas Pipeline (NMGP), a 5,600-km offshore network that would serve more than a dozen West African states. This system would, like TSGP, pump Nigerian gas to Europe, but it would also serve the purpose of delivering the gas to regional markets as well. As such, it would establish Nigeria as a supplier of fuel to much of West Africa.

    Thus far, neither NMGP nor TSGP has been built. But Nigerian authorities are working to hammer out agreements on these projects – and they see the ways that European market conditions have changed since the beginning of 2022 as an incentive to work harder and to work faster.

    What Nigeria Could Achieve

    If they succeed, they will create infrastructure that could do quite a bit to alleviate energy poverty in Nigeria and beyond.

    In the case of NMGP, the construction of this pipeline would provide multiple countries beyond Nigeria with a steady source of gas. As such, it would serve as an incentive for the construction of TPPs in places where millions of people do not have access to reliable energy supplies. At the same time, the pipeline’s access to European markets, where buyers are more likely to pay in hard currency, would help ensure the profitability of the whole system.

    Likewise, the TSGP network has the potential to benefit Nigeria by ensuring that the country has enough access to hard-currency markets in Europe to cover the costs of the domestic initiatives that depend on AKK – that is, the gas-fired power and industrial projects in the northern part of the country.

    Infrastructure Is Needed Throughout the Continent

    Of course, energy poverty is not limited to Nigeria; more than 600 million people in Africa lack access to electricity, and nearly 730 million use hazardous and inefficient cooking fuels and technologies. Nevertheless, while each African country is unique, I hope that this look at Nigeria helps shed light on some of the common challenges facing our continent’s countries — a higher rate of energy poverty in rural areas and the tremendous need for infrastructure development.

    As “The State of African Energy: 2023 Outlook” points out, even in the four African countries with a universal electricity rate of more than 70% — Egypt, South Africa, Kenya, and Algeria — access to electricity drops significantly in rural areas, to an average of about 63% of the population, compared to an average of 96% in urban areas.

    The situation for rural Africans is even more dismal in other parts of the continent. In the Democratic Republic of Congo, for example, only about 19% of the overall population has access to electricity and in rural areas, only 1% of the population has electricity.

    This will not change until we develop the necessary infrastructure to deliver energy to Africans throughout the continent.

    On the brighter side, Nigeria also gives us examples of measures African countries can take to begin addressing these challenges. No, Nigeria has not achieved its ultimate goal-eradicating energy poverty, but it has plans and initiatives in place with real potential to make a difference — as long as Nigeria continues pursuing them.

    If they haven’t done it yet, governments throughout the continent should be developing and implementing multipronged programs of their own to eradicate energy poverty. They, like Nigeria, should be leveraging their natural gas resources. They should be developing and executing gas utilization plans, improving their approach to resource management, monetizing natural gas to help pay for infrastructure projects, and launching more gas-to-power initiatives.

    Instead of being daunted by the vast numbers of Africans without electricity, shrugging our shoulders, and giving up, I hope that we will be steadfast in our determination to make energy poverty history by the end of this decade.

    For a complete look at our recommendations and “The State of African Energy: 2023 Outlook,” download our report here (https://bit.ly/3goAZzK).

  • Q3: Dangote increases cement sales by 6.2% to 20.8mt as it embraces alternative fuel to cut cost

    Q3: Dangote increases cement sales by 6.2% to 20.8mt as it embraces alternative fuel to cut cost

    For the third quarter of 2022, the Management of Dangote Cement has recorded an increase in the overall volume of cement sales by 6.2 percent to 20.8metric tons. This was achieved despite the elevated inflation that is due to a very volatile global environment.

    To further increase the supply of cement across its operational base, the company has also commissioned its power plant at Okpella and is progressing well to deploy grinding plants in Ghana and Cote d’Ivoire.

    Chief Executive Officer of Dangote Cement, Michel Puchercos, who disclosed this while presenting the third quarter results to the Nigerian Stock Exchange, over the weekend, further explained that “To mitigate the impact of the significant increase in energy and AGO costs, we are strengthening our efforts to ramp up the usage of alternative fuels. So far this year, we have co-processed 101,553 tonnes of waste representing a 77% increase over 9M 2021. We are on track to commission our Alternative Fuel feed system at Obajana lines I and V, and Ibese line II in November. In addition, we are ramping up our investment in Compressed Natural Gas (CNG), to reduce our AGO usage”

    To that end, he explained that the company recorded an increase in revenue of ₦1,177.3B, up 15.2% compared to last year, and Group EBITDA of ₦515.9B, up 0.2% with an EBITDA margin of 43.8%”

    Dangote Cement, it would be recalled is Africa’s leading cement producer with nearly 51.6Mta capacity across Africa. A fully integrated quarry-to-customer producer, it has a production capacity of 35.25Mta in its home market, Nigeria. 

    Obajana plant in Kogi state, Nigeria, is the largest in Africa with 16.25Mta of capacity across five lines while the Ibese plant in Ogun State has four cement lines with a combined installed capacity of 12Mta.  The Gboko plant in Benue state has 4Mta while the Okpella plant in Edo state has 3Mta. 

    Through recent investments, Dangote Cement has eliminated Nigeria’s dependence on imported cement and has transformed the nation into an exporter of cement serving neighbouring countries.