By Amara Osei

Nigeria’s estimated $200 billion gas-infrastructure funding gap over the next decade requires foreign capital, according to the Midstream and Downstream Gas Infrastructure Fund (MDGIF). The requirement equals about $20 billion annually for 10 years, based on an estimate made a few years ago.

Executive Director Oluwole Adama said foreign investment funds have become critical to closing that gap, while MDGIF also called for local private-sector capital. He made the assessment during the commissioning of five compressed natural gas (CNG) stations—daughter supply hubs and last-mile (final-distribution) retail outlets—established by Ibile Oil and Gas Corporation (IOGC) with MDGIF support.

The Lagos facilities are in Abule-Egba, Oko-Oba, Ajah, Ogolonto and Idimu. Adama said the investment scale exceeds MDGIF’s financial capacity, making partnerships with development finance institutions (DFIs), foreign investment funds and private-sector players critical.

What is MDGIF’s financing mandate?

“An estimate a few years ago put the investment required to close Nigeria’s gas infrastructure deficit at about $20 billion annually for 10 years. That is approximately $200 billion. What MDGIF can do is limited in terms of the resources available to us, so we see ourselves as a catalytic agent,” Adama said.

MDGIF positions itself to reduce investment risk, unlock financing and encourage businesses to commit capital across the gas value chain. Its mandate extends beyond direct financing toward creating an enabling environment for:

• Gas processing plants and gas capture projects
• Pipelines, CNG refuelling stations, terminals and storage facilities

Adama said the fund has secured a $500 million debt facility and is pursuing additional financing arrangements, including risk guarantees. MDGIF has engaged the United States Development Finance Corporation (DFC) to mobilise further funding for Nigerian gas-infrastructure projects.

The objective is to reduce investment risk, particularly during early-stage project development, and unlock larger pools of capital from international financiers and private investors. MDGIF has supported more than 25 infrastructure projects, including about 18 commissioned in less than two years.

Adama said gas-infrastructure delivery requires time across project design, engineering, equipment manufacturing, shipping, port clearance and construction. Such investments cannot be delivered overnight, he said.

How is domestic gas supply changing?

Minister of State for Petroleum Resources (Gas) Ekperikpe Ekpo said the Federal Government is intensifying efforts to increase domestic gas utilisation, expand infrastructure and make natural gas more accessible to Nigerians. Domestic supply increased from about 1.6 billion cubic feet per day to 2.2 billion, which he attributed to growing sector investment and government policy under President Bola Tinubu.

Ekpo said the government is working with private-sector investors to address infrastructure and supply constraints, and he expects rising gas demand to continue attracting investment. He said government alone cannot build the infrastructure required to deepen utilisation, making private-sector participation indispensable, and he commended MDGIF’s role in supporting development and attracting capital.

What do the five new CNG stations add?

IOGC Managing Director and Chief Executive Officer Tayo Gbajumo said the corporation is expanding CNG infrastructure in Lagos under a mandate to establish 15 stations across the state. Five additional stations have been commissioned in Abule-Egba, Ajah, Oko-Oba, Idimu and Ogolonto.

The remaining six were at various stages of completion and expected to be commissioned by the first quarter of 2027. Gbajumo said the facilities should improve access to affordable energy, reduce transport costs for businesses and households, and support the adoption of CNG-powered vehicles.

According to Adama, the five MDGIF-supported stations have combined storage capacity of 45,640 standard cubic metres. At full capacity, they are expected to serve approximately 8,400 vehicles daily.

Gbajumo commended the Federal Government, Lagos State Government and MDGIF for their support. He said the partnership demonstrated the importance of collaboration between government institutions and industry stakeholders in expanding gas infrastructure.

MDGIF’s $500 million debt facility, more than 25 supported projects and five commissioned stations define its current contribution. The disclosed $200 billion requirement makes DFIs, foreign investment funds and domestic private capital central to delivery over the next decade.