Nigeria seeks US funding for natural gas development

By Derrick Bangura

Mr Timipre Sylva, Nigeria’s Minister of State for Petroleum Resources, called on the US government on Thursday to provide funding to help Nigeria develop its natural gas resources. Sylva’s call comes on the heels of Russia’s war with Ukraine, which is currently threatening to disrupt gas supplies from Russia to the entire European continent. During a meeting with US Secretary of Energy Jennifer Granholm on the sidelines of CERAweek in Houston, Texas, Sylva stated that collaboration between the US and Nigeria in this area would benefit both countries as well as the entire world. “It is in the interests of the global community that there is alternative supply of gas to Europe. The challenge for us to achieve this feat has been lack of infrastructure and we need funding to development infrastructure for our gas and we believe that the US can provide that funding,” Sylva stated. Stating that the natural gas could serve as an alternative source of energy for Europe, Sylva told Granholm that Nigeria has abundance of the commodity that can meet European gas demands, but said that the problem has been access to funding. He explained that as part of efforts to boost gas supplies across the African continent, Nigeria has embarked upon the construction of 600 kilometres of the Ajaokuta- Kaduna- Kano (AKK) gas pipeline designed to take gas to Europe via North Africa. Sylva therefore called on the US to provide the needed funding for infrastructure for the exploitation of the huge natural gas in Nigeria. “We have access to gas but access to funding has been the problem. Our desire is to be able to take gas from Nigeria through Algeria to Europe. We have already kick-started the AKK gas pipeline project and if we have the required funding we can complete that project in two years. “Nigeria has over 206 tcf of natural gas reserve and unproven reserve of 600 tcf and we believe that if we target exploitation of natural gas in Nigeria, we will be able to get up to 600 tcf. We need to have the needed funding to develop our gas and the US can provide us this funding,” he added. The minister said the crisis between Russia and Ukraine was a wake-up call to have alternative sources of gas to Europe, stressing that in situations like this, it is always good to have alternatives. Speaking on the issue of global energy transition, Sylva said for the energy transition programme to be meaningful, the peculiar problems of Africa must be factored into the entire energy transition arrangement. “We have to be given some special considerations. I am excited that the world has started listening to us. I was particularly happy that John Kerry echoed our position when he spoke at a panel session. “Inasmuch as we want to be part of the new economy, we can not move at the same pace. We still have people without clean cooking fuels, so we want to achieve our energy base load through a multi pronged approach. The reality check is that we cannot move at the same pace. There is gap between expectations,” he noted. Sylva however cautioned that such funding and technological supports must be made accessible to interested countries. “We have to work out a structured way to access the funding. We must create that understanding to make the loans accessible. The issue of sovereign guarantee must be removed so that interested countries can easily access the funding. “the minister further stated. Citing the case of the African Growth Opportunity Act (AGOA), Sylva said since the programme came into force so many years ago, no African country has been able to successfully key into the project for maximum benefits. He said: “It has not been easy for Africa to access AGOA. so the type of funding we are looking at is the one that Nigeria will be able to access”. In her remarks, Granholm expressed the readiness of the US to cooperate with Nigeria to develop her renewable energy sector, noting that her government was not against the development of gas or other sources of energy. She therefore called for a coordinated strategy to pin down specific areas of focus where funding and other supports would be required. “Investors are interested in funding renewable energy in Nigeria but they are interested in knowing possible areas of focus. We have to work out a structured way to access the fund” Granholm said. In an earlier meeting with the US Assistant Secretary of State, Harry Karman, Sylva expressed Nigeria’s willingness to develop the different sources of renewable energy such as wind, solar and hydrogen. He spoke also about the need to streamline targeted financing adding that “there must be a framework of accessing the funding”. Karman in his remarks assured the minister of the US government’s readiness to support Nigeria in finding sustainable energy sources for the millions of Nigerians without access to power.