French oil giant, TotalEnergies, has revealed a massive investment plan of $750 million for a new Liquefied Natural Gas (LNG) project in Nigeria.
The announcement was made by Mike Sangster, the company’s Senior Vice President for Africa, during the France-Nigeria Business Forum in Paris on Friday.
Sangster described the project, called Ima, as a shallow water gas initiative aimed at bolstering Nigeria’s gas supply.
According to him, the project will feed into TotalEnergies’ existing LNG facility in the country.
“We have another dry gas project called Ima which we hope to sanction next year for about $750 million,” Sangster revealed.
This investment is part of TotalEnergies’ broader strategy to revive Nigeria’s hydrocarbon production.
Sangster emphasized that the move is crucial for the company’s long-term plans in Africa’s largest oil and gas market.
Reviving Nigeria’s Energy Sector
The Ima project is not the company’s first significant investment in Nigeria’s gas sector this year.
Earlier in 2024, TotalEnergies launched the Ubeta onshore gas field.
The Ubeta project, valued at $500 million, has a daily production capacity of 300 million cubic feet of LNG.
It is a joint venture with the Nigerian National Petroleum Corporation (NNPC) Limited.
TotalEnergies’ commitment to Nigeria’s gas industry signals its confidence in the country’s potential despite existing challenges.
Call for Regulatory Reforms
While praising some reforms in Nigeria’s oil and gas sector, Sangster called for further changes to boost foreign investments.
He urged a relaxation of local content regulations to allow the return of international contractors for deep-water projects.
According to Sangster, easing these restrictions would increase competition and attract more capital.
“There’s still more to be done in terms of regulation, simplifying, and accelerating the process,” he said.
Sangster also highlighted that reforms introduced over the past year have given companies like TotalEnergies renewed confidence.
“The incentives introduced have motivated us to consider further investments in Nigeria,” he added.
The company hopes to halt the decline in Nigeria’s oil and gas production with these new projects.
A Strategic Boost for LNG Production
TotalEnergies’ $750 million commitment comes at a time when Nigeria is seeking to expand its LNG production capacity.
The government has been pushing for more investments in the sector to meet domestic and international demand.
Nigeria, one of Africa’s top oil producers, has faced declining production due to regulatory hurdles and aging infrastructure.
TotalEnergies’ projects, including Ima and Ubeta, are expected to play a significant role in reversing this trend.
The investments will also create jobs and support local communities.
Government Efforts Recognized
Sangster acknowledged the Nigerian government’s efforts in improving the business environment.
He praised the reforms that have been implemented over the years but noted that more work is needed.
“There have been positive changes, but we need more streamlined processes to attract global investors,” he said.
TotalEnergies is not alone in its call for regulatory improvements.
Industry experts have long advocated for policies that encourage foreign participation and simplify bureaucratic processes.
Hope for a Brighter Future
With TotalEnergies’ investment plans, there is renewed hope for Nigeria’s energy sector.
The company’s commitment is seen as a vote of confidence in Nigeria’s potential to remain a major player in the global energy market.
As Sangster put it, the focus now is on increasing production and driving growth in the sector.
For Nigeria, this investment could be the beginning of a significant turnaround in its oil and gas fortunes.
Experts believe that projects like Ima and Ubeta could set the stage for more international partnerships.
The coming years will be crucial as Nigeria strives to implement further reforms and attract additional investments.
TotalEnergies’ decision to invest $750 million in the Ima project underscores the importance of Nigeria’s gas resources on the global stage.
With the right policies in place, the country could unlock its full potential and become a major hub for LNG production in Africa.
