Nigeria LNG Limited (NLNG) is turning to third-party gas suppliers to sustain production, following a sharp decline in plant utilization caused by dwindling feed gas from its traditional International Oil Company (IOC) shareholders.
Mr. Nnamdi Anowi, General Manager of Production at NLNG, disclosed this shift during a Focused Group Session at the Gastech Exhibition and Conference in Milan, Italy.
The session was themed “Resilience in the Face of Operational Challenges – The NLNG Story.”
IOC divestments force strategic rethink
Anowi explained that the transition was necessitated by IOCs divesting from Nigeria’s onshore assets to deepwater operations, a move that significantly constrained NLNG’s feed gas supply.
“NLNG achieved record output in 2019 with 316 LNG cargoes, but subsequent supply constraints triggered a strategic rethink.
“Our initial gas supply came from shareholder IOCs. However, with Eni transferring assets to Oando and other divestments, we shifted focus to third-party gas sourcing,” he said.
Today, 75% of NLNG’s feed gas comes from third-party suppliers, supported by a series of Gas Supply Agreements. A second tranche of such supplies is expected by October, with volumes projected to stabilize from late 2026 through early 2027.
Plant utilization drops to 60%
The pivot comes against the backdrop of declining output. Despite operating six trains with a combined capacity of 22 million tonnes per annum (MTPA), NLNG has seen plant utilization average around 60% over the past three years.
Train 7, currently under construction, is expected to expand output by more than 30% once completed, but sustaining feed gas remains the central challenge.
Anowi highlighted the wider implications of Nigeria’s gas supply challenges, stressing that 60% of Africa’s population still lacks access to affordable energy despite the continent’s vast reserves.
He described Nigeria as a “gas-rich nation with largely untapped offshore reserves” and urged greater investment in infrastructure and offshore exploration. According to him, the Federal Government’s new incentives for offshore gas development could unlock these reserves and strengthen Nigeria’s role in bridging Africa’s energy deficit.
“What happened in Nigeria when power availability improved can happen across Africa. With energy, industry will thrive, jobs will be created, and production will shift to Africa. Investors and financiers must begin to view Africa as a viable destination, especially with current government incentives,” he said.
What you should know
Nigeria’s gas supply to NLNG had long underperformed, with Renaissance Africa Energy struggling to meet obligations due to aging infrastructure, underinvestment, and inefficiencies.
- At the 2025 NAICE conference, Renaissance announced it had, for the first time in five years, met its gas supply commitments to NLNG.
- The turnaround followed a 40% surge in crude output over four months, backed by fresh capital and operational efficiency.
Renaissance now targets doubling gas supply to 300m scf/d and plans a $15 billion investment in infrastructure and asset rehabilitation.
