A leading Nigerian oil and gas company, NESGAS Limited, on Thursday announced the signing of a $200 million contractor financing agreement with Cakasa Nigeria Limited for the construction of a 50,000 metric tons Liquefied Petroleum Gas (LPG) storage facility in Onne, Rivers State.

While Nigeria reportedly has the fastest-growing LPG sector in the world, with a projected LPG market size of $10 billion, its storage capacity of 800,000 metric tonnes is far below the government’s projected 5 million metric tons distribution.

NESGAS, while signing the deal, said the financing would enable the timely execution of the project, reinforcing the government’s push for domestic gas utilisation.

Speaking at the signing ceremony in Abuja, Managing Director of NESGAS, Tunde Banjo, said the move would accelerate the expansion of Nigeria’s LPG infrastructure, enhancing supply security, and supporting the country’s transition to cleaner energy.

Banjo said: “This project is a major leap forward in our mission to strengthen Nigeria’s LPG value chain. Partnering with Cakasa ensures we have the expertise and financial backing to execute this ambitious development successfully.”

While most LPG storage capacity in the country is within 4,000 to 20,000 metric tons, the 50,000 metric tons is expected to drastically increase utilisation in a country where wood falling for cooking, is compounding the deforestation crisis and health burden for women.

Nigeria is targeting five million MT of LPG consumption yearly, this development would enable over 60 million households to use LPG by 2030.

Managing Director of Cakasa Nigeria Limited, Barnabas Olise said the financing deal reaffirms commitment to supporting Nigeria’s energy sector with engineering and construction solutions.

Executive Director, Business Development at the organisation, Celestine Cliffe, said the Onne facility would significantly boost Nigeria’s LPG storage and distribution capacity, ensuring a more sustainable and secure energy supply for millions of households and industries.