An Ardova Plc-led consortium, including Diadem Energy, has agreed to acquire 100 per cent of Powergas Global Investments Nigeria Limited and Powergas Ebedei Limited (PEL), in a deal that will expand Ardova’s operations into Compressed Natural Gas (CNG) production and distribution.

A.P. Moller Capital announced the agreement, on Friday, through its Africa Infrastructure Fund I (AIF I) and Impala Energy Holdings (Impala), saying the transaction would combine Powergas’ gas sourcing relationships, compression infrastructure and industrial customer base with Ardova’s nationwide retail, logistics and distribution network.

Executive Chairman of Ardova, Dr. AbdulWasiu Sowami, said the acquisition would enable the company to connect Nigeria’s gas resources to the industrial, power and transportation sectors, while supporting the Federal Government’s Presidential Initiative on Compressed Natural Gas and Electric Vehicles (Pi-CNG & EV) and the Decade of Gas programme.

“Powergas has built the compression backbone required to take natural gas beyond the conventional pipeline grid. Ardova brings a national distribution network, deep customer relationships and the ability to invest for the long term,” Sowami said.

He said the company planned to deliver more affordable, lower-emission energy and reduce transportation costs for Nigerians, while building a gas platform that could eventually extend beyond the country.

Managing Director of Ardova, Dr. Abiola Babatunde-Ojo, said the immediate focus would be on expanding compression capacity, bringing CNG into the company’s retail network and connecting more industries and fleets to a reliable domestic energy source.

Ardova plans to establish 100 CNG re-fuelling sites nationwide within 24 months as part of the expansion. The company also intends to increase Powergas’ compression capacity across viable gas-producing corridors to create firm offtake for associated and non-associated gas, support flare reduction and attract further investment across the gas value chain.

Powergas is one of Africa’s largest CNG producers and virtual pipeline distributors, supplying natural gas to industrial, commercial and power customers beyond the conventional pipeline grid. Its Ebedei flare gas monetisation project captures gas that would otherwise be flared and converts it into energy for commercial and industrial use.

A.P. Moller Capital invested in PEL through Impala, AIF I’s first investment, in April 2019 and supported the business through development, construction, commissioning and operational scale-up. PEL commenced operations in 2020, while its Ebedei compression plant was commissioned in 2021. It has since expanded its distribution across the South-East, South-South and South-West.

The company’s operations have also created 175 direct jobs, in addition to employment across its supply chain. Powergas supplies gas to industrial and commercial customers, many of whom use it as an alternative to diesel generators, helping to reduce emissions at both the production and consumption points.

Powergas Vice-Chairman, Pulak Sen, said the company’s compression infrastructure, combined with Ardova’s national reach, would provide opportunities to expand into new markets and geographies. Diadem Group Chairman, Dr. George Eluwa, said his company’s existing role as Powergas’ virtual-pipeline logistics partner had given it first-hand experience of delivering natural gas beyond the conventional pipeline network.

A.P. Moller Capital Partner, Sam Senbanjo, said PEL had progressed from development to a fully operational CNG business since the fund’s investment in 2019, adding that Ardova and Diadem were well positioned to support its next phase of growth.

Completion of the acquisition is expected around the end of 2026, subject to customary closing conditions, including required regulatory and other third-party approvals. Ardova said it also intended to extend the platform into the wider West African market over time.