Refiners demand proper investment as NMDPRA seeks $575b decarbonisation funding

African Refiners and Distributors Association (ARDA) has asked for a proper investment plan as the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) seek a $575 billion funding for decarbonisation.

Speaking on the sideline of the United Nations Climate Change Conference (COP28) in Dubai, the Executive Secretary of ARDA, Anibor Kragha, said Nigeria should harness funding opportunities for gas projects from international financiers dealing with agriculture as gas plays a key role in the sector.

Kragha said looking to Development Finance Institutions (DFIs) is critical as the additional financing support would unlock private capital for their investments.

He posited that the Bank of Agriculture could serve as a key leeway given that gas serves as the primary raw material for fertilizer. He also urged the NMDPRA as the regulator of the Midstream and Downstream industry to develop a decade-by-decade plan to decarbonise the mid/downstream with bankable projects that would elicit finance from foreign donor agencies.

Kragha said developing and including young people in the decarbonisation drive is sacrosanct, adding that young people would play a major role in implementing the initiatives in the future.

Executive Director Health, Safety, Environment and Community (HSEC) at NMDPRA, Dr. Mustapha Lamorde, said NMDPRA Industry Sustainability Initiative (NISI) was created in line with the Global Sustainability Development Goals, which are geared towards achieving Nigeria’s 2060 Net Zero commitment in the midstream and downstream petroleum industry.
 
He said NISI would create over $575 billion in capital investment opportunities for Nigeria through decarbonisation of operations, infrastructure and technological development, green economy improvement, stakeholder management and human capital development.

A breakdown of the investment opportunities highlighted sector by sector by Lamorde are; $272 billion in power, $127 billion in infrastructure, $96 billion in oil and gas processing optimisation, $80 billion in industry and $2.8 billion in clean cooking.

Lamorde said achieving this requires strong government commitment and collaboration with the private sector using technological innovation. Executive Director, Midstream and Downstream Gas Infrastructure Fund (MDGIF), Mansur Kuliya Alkali explained that the Midstream and Downstream Gas Infrastructure Fund (MDGIF), set up pursuant to Section 52 of the Petroleum Industry Act (PIA) is pivotal to accelerating investments along the gas value chain.

He clarified that the MDGIF was neither a grant nor a loan, but an investment initiative designed to de-risk investments through partnerships with private sector players to build the necessary infrastructure to harness the country’s vast gas resources.

Similarly, Technical Adviser on Transition Energy to the Honourable Minister of State, Petroleum Resources (Gas), Abel Nsa, said the Host Community Development Framework as launched by the commission for upstream operations, among other benefits, would ensure that oil and gas assets are adequately protected to gaurantee uninterrupted production and supply, which is critical to midstream operations.

He added that the Decade of Gas initiative of the government would also guarantee availability of gas for domestic utility, saying discussions were ongoing with upstream gas producers to deliver on the mandate.