The federal government has released N122 billion funding to six companies from the Midstream and Downstream Gas Infrastructure Fund (MDGIF) to boost gas utilisation across the country.
The minister of state for Petroleum Resources, (Gas), Ekperikpe Ekpo, made this known during the signing of agreements with the six companies in Abuja on Monday.
The government signed agreements with the companies namely: Asiko Energy Holdings Limited AEHL), FEMADEC Energy Limited, Ibile Oil and Gas Corporation (IOGC), Nsik Oil and Gas Limited, Rolling Energy Limited, and Topline Limited.
Ekpo said the government is committing the N122 billion through the MDGIF to assist in the deployment of gas across Nigeria.
His words: “We needed to hear you speak to Nigerians because today the federal government through MDGIF is committing N122 billion into the hands of the six investors, to help in the dissemination of gas to all sectors of the country.
He said the release of N122 billion will not be the last as the Fund is screening another set of investors for gas development.
Ekpo described gas as a cleaner energy needed to save the environment.
He said the benefitting investors were the first to sign agreements for the projects since the enactment of the Petroleum Industry Act (PIA)
The minister said, “For those who did not make up the first six, we will make up the second one. But go home and put your records in and of course, this is the first since the passing of the PIA 2021. This is the first signing. And we expect you to live up to expectations.”
The three types of agreements were Joint Operating Agreements, Equity Contribution Agreements, and Joint Venture Account Agreements.
Meanwhile, the MDGIF executive director, Oluwole Adama said the PIA established the fund intending to increase the domestic consumption of natural gas in Nigeria.
He said the “projects which are financed partly by these project promoters seated across, encouraging private investment through risk-sharing by participating initially in selective high-risk projects.”
He added that agreements were also about equity investment that encouraged investment in midstream, downstream, and gas infrastructure.
“Six of the projects finally made it here. One with a liquefied natural gas (LNG) plant, liquefied petroleum gas, (LPG), and propane storage is there. Four compressed natural gas comprising auto and retail infrastructure projects. And one for the 20 Nigerian universities by one of the promoters.
And I believe these investments are spread across the entire country, including 20 federal universities, to alleviate the cost of transportation to Nigerian students, lecturers, and administrative staff. And it is hoped that more institutions will be included as soon as possible.
The pacts, according to him, were designed to reduce gas flare.
Also speaking, chairman, Senate Committee, Gas, Senator Jarigbe, Jarigbe said the fund was provided by Section 54 of the PIA. and was supposed to be implemented in 2021, when it was gazetted.
He commended the MDGIF board for making progress and assured of the Senate’s readiness to give the government all the support it requires to fully implement the provisions of the Act.
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