Nigeria is embarking on a bold journey to transform its energy landscape, and at the heart of this transformation is the Midstream and Downstream Gas Infrastructure Fund (MDGIF). Established under the Petroleum Industry Act (PIA) of 2021, the MDGIF is now one of the most ambitious initiatives in Africa’s energy sector, designed to drive investment in gas infrastructure, reduce harmful gas flaring, and make energy more affordable for everyday Nigerians.
Over the past year, the MDGIF has moved from a concept on paper to a funding powerhouse, supporting over 16 companies to develop gas-related projects that could reshape how Nigeria produces, transports, and uses energy. With a clear focus on infrastructure development, this initiative promises not only to reduce the country’s dependence on petrol but also to boost economic growth, create jobs, and cut energy costs for millions.
A Vision Backed by Investment
Gas is increasingly seen as the future of energy in Nigeria. The country has vast natural gas reserves, estimated at over 200 trillion cubic feet, yet much of this potential remains untapped. The MDGIF was launched to bridge this gap by channeling investment into the midstream and downstream sectors of the oil and gas industry.
Under this model, MDGIF acts as both a financier and a partner for companies building critical infrastructure like gas processing plants, refueling stations, storage terminals, and pipelines. The Nigerian government estimates that $20 billion per year will be needed over the next decade to fully close the infrastructure gap—an ambitious target, but one that could change Nigeria’s energy story if achieved.
The fund’s goals align with President Bola Tinubu’s Decade of Gas initiative, which positions natural gas as the engine for Nigeria’s industrial growth and a cleaner alternative to petrol and diesel.
Key Projects Taking Shape
The MDGIF’s efforts are already bearing fruit, with multiple gas-related projects underway across the country:
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CNG Refueling Stations for Transport
Compressed Natural Gas (CNG) is being positioned as a cost-effective and cleaner alternative to petrol for vehicles. Companies like FEMADEC Energy Ltd have rolled out CNG stations in five major university towns, including Ife, Abuja, Zaria, Owerri, and Uyo, with plans to expand to 20 stations by the end of 2025.
Similarly, Ibile Oil & Gas is 60% through a project to build 15 CNG stations, while Rolling Energy is developing CNG hubs in Abuja, Kano, Kaduna, and Borno, set for launch in early 2026.
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LNG and LPG Terminals
Lagos is seeing significant development with Asiko Energy Holdings Limited constructing a 5,000 MT propane terminal and a 13,200 MT LNG facility in Ijora, expected to be completed by 2026. These facilities will help diversify Nigeria’s energy mix, provide fuel for industries, and reduce reliance on imports.
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Mini-LNG Plants and Gas Processing
In Delta State, Topline Limited is building a 5 MMSCFD mini-LNG plant in Oghara to process natural gas locally and reduce flaring. The government has also signed agreements with companies like ANT Energy Ltd and Sub Sea Gas to build six gas processing plants, three CNG refueling stations, and one large LPG storage facility nationwide.
These projects highlight a shift from traditional oil dependency toward a gas-powered economy, with direct benefits for transportation, manufacturing, and power generation.
Tackling Gas Flaring and Energy Costs
Nigeria has long struggled with gas flaring, where valuable natural gas is burned off during oil extraction, wasting energy and harming the environment. The MDGIF’s investments in processing and storage facilities aim to capture and utilize this gas, turning a costly problem into an opportunity.
At the same time, the expansion of CNG stations could dramatically reduce fuel prices for commuters. CNG is significantly cheaper than petrol, and with more refueling stations, taxi and bus operators can cut costs, potentially passing savings to passengers. This shift comes at a time when Nigerians are grappling with high petrol prices and economic pressures, making alternative fuels especially attractive.
Transparency and Accountability Challenges
While the MDGIF has generated excitement, there are concerns over transparency. The government previously disbursed ₦122 billion to six companies for gas projects, but some of these projects have been slow to share progress reports. Stakeholders are urging regular updates and clear auditing processes to ensure funds are not mismanaged.
Industry experts have also called for more government incentives to attract private-sector investment, such as tax breaks and simplified regulatory processes. Without sustained support and oversight, there’s a risk that these projects could stall before delivering meaningful impact.
Economic and Social Impact
The potential benefits of Nigeria’s energy reform are significant:
| Benefit |
Impact |
| Cleaner Environment |
Reduced gas flaring and emissions will improve air quality. |
| Cheaper Transport |
CNG adoption could cut fuel costs for public transport and logistics. |
| Job Creation |
New infrastructure projects will create thousands of jobs. |
| Energy Security |
Local gas facilities will reduce import reliance and boost reliability. |
| Industrial Growth |
Affordable, reliable energy will support Nigeria’s manufacturing sector. |
The reforms also align with global efforts to transition to cleaner energy sources while leveraging Nigeria’s rich natural gas reserves.
Looking Ahead
Nigeria’s energy reform push is a bold step toward a more sustainable and affordable energy future. If fully implemented, the MDGIF could turn Nigeria into a regional energy hub, reduce the burden of high petrol costs on citizens, and attract billions of dollars in foreign investment.
However, success will depend on strong governance, private-sector collaboration, and timely execution of projects. For now, the groundwork is being laid, and Nigeria is signaling to the world that it is ready to embrace a gas-driven future.
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