Nigeria’s Gas Infrastructure Fund Boosts Global Cooperation To Close $20bn Infrastructure Gap

The Midstream and Downstream Gas Infrastructure Fund (MDGIF), is broadening global cooperation to attract more funds that will enable it execute critical projects that will unlock new investments in the gas industry.

The collaboration is part of the Fund’s strategy to bridge a reported $20 billion annual deficit in Nigeria’s gas infrastructure.

Fund is collaborating with international partners, including through a $500 million agreement signed with Afreximbank, to achieve its objectives.

The Executive Director of the MDGIF, Oluwole Adama, says that the sector is highly capital-intensive and largely unattractive to commercial lenders.

He however disclosed that the Fund is supporting about 200 gas infrastructure projects nationwide to unlock Nigeria’s 200 trillion cubic feet of gas reserves.

Adama disclosed this during a fireside chat at the West African Refined Fuels Market (WARFM) Conference in Abuja.

The panel session was tagged “Investment Challenges and Opportunities for African Oil and Gas Infrastructure.”

According to Adama, the Fund, in its bid to tap the nation’s gas reserves, has reached Final Investment Decisions (FID) on 31 projects while supporting the “construction of more than 200 pieces of infrastructure over the past 18 months.”

He added that 10 of those projects have been commissioned and also announced that the Fund would commission about six to eight additional gas processing plants and over 50 CNG daughter and mother stations between October and December 2026.

The MDGIF was established under the Petroleum Industry Act 2021 to de-risk investment in gas infrastructure.

He emphasised, however, that the Fund’s approach is to provide “patient capital through equity ownership rather than traditional loans or grants.”

According to him, this approach is designed to make highly capital-intensive gas projects bankable, especially given the high commercial interest rates.

He stressed that gas is the way to go for Nigeria because it is a cheaper source of fuel for automobiles and other energy needs.

The Executive Director of Finance and Accounts at the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), Abiodun Adeniji, expressed optimism that the planned launch of the African Energy Bank would offer financing at rates closer to those available in foreign jurisdictions, as against the double-digit rates charged by Nigerian commercial banks.

He called for adequate funding for MDGIF to enable it to perform its role in the sector.

In May 2026, the Fund reportedly committed over N430 billion to gas infrastructure across Nigeria amid President Bola Tinubu’s commissioning of four flagship Compressed Natural Gas projects that same month.

Hussaini Basaka, Director-in-Charge of Project Management at MDGIF, told the press about the monetary implications of the CNG projects.

”So, in ballpark terms, the MDGIF has invested over N430 billion and catalysed about ten times that amount about N1.6 trillion in investments,” he said at the time.

He added that, for the particular project in Abuja at the time, MDGIF took a 45 per cent stake by investing a substantial amount of money.

The Federal Government of Nigeria, in March 2025, launched a N2.5 billion credit scheme to encourage the conversion of vehicles to Compressed Natural Gas (CNG) and the manufacturing of conversion kits.

The Presidential Compressed Natural Gas Initiative (PCNGi), which disclosed this, stated that the initiative was aimed at easing energy and transportation costs in Nigeria.

The Federal Government maintained that the development was intended to boost gas mobility while demonstrating its commitment to sustainable energy solutions and providing financial relief to citizens.