The Presidential Compressed Natural Gas Initiative (P-CNGi) and LNG Arete Ltd. have entered into a landmark $27.3 million agreement to develop compressed natural gas (CNG) infrastructure in Northern Nigeria. The deal, finalized on Friday, April 4, 2025, aims to address longstanding energy challenges in the region by constructing a mini-Liquefied Natural Gas (LNG) plant in Ajaokuta, Kogi State.
The project will establish a facility with a processing capacity of seven million standard cubic feet per day (MMSCFD), significantly improving the availability of CNG for industries and households across Northern Nigeria. This initiative is expected to create over 100 jobs and enhance energy access in an area historically underserved by stable gas infrastructure.
Investment Breakdown and Timeline
The funding for the project is being sourced from multiple stakeholders:
P-CNGi will contribute $6 million.
LNG Arete Ltd. will invest $12 million.
The remaining funds will be provided by the Midstream Downstream Gas Infrastructure Fund, managed by the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA).
Construction is set to begin immediately, with the plant expected to become operational within 12 to 16 months.
Mr. Michael Oluwagbemi, Programme Director and CEO of P-CNGi, emphasized that the partnership would serve as a key supply hub for CNG in Northern Nigeria. He noted that this project would reduce transportation costs, support industries such as textiles, agriculture, and manufacturing, and lower logistics expenses for goods moving from the north.
“This initiative will not only meet the energy demands of industries but also accelerate industrial growth and create jobs in the region,” Oluwagbemi stated.
The plant is designed to complement existing infrastructure like the Ajaokuta-Kaduna-Kano (AKK) gas pipeline, further enhancing gas distribution across Nigeria. Once operational, it will convert LNG into CNG, providing a cleaner and more cost-effective fuel option for transportation and industrial use.
The collaboration aligns with P-CNGi’s broader goals of leveraging Nigeria’s abundant natural gas resources to provide cleaner, more affordable, and sustainable energy solutions. By fostering increased local participation in the energy sector, the project aims to bridge the energy gap in underserved regions while boosting Nigeria’s competitiveness on both regional and global scales.
Hajara Pitan, Project Director at LNG Arete Ltd., described the initiative as a significant milestone for expanding gas utilization across Nigeria. “This project demonstrates how innovative mini-LNG technology can drive local engagement in the sector while addressing critical energy needs,” she said.
