The Traffic

NNPCL Strikes Major Gas Deal with Dangote Refinery in Groundbreaking Agreement

 By Achimi Muktar

In a strategic move set to boost Nigeria’s energy security and industrial growth, the Nigerian National Petroleum Company Gas Marketing Limited (NNPCL) has signed a landmark Gas Sale and Purchase Agreement with Dangote Petroleum Refinery and Petrochemicals. The agreement, which was formalized on Tuesday, will supply natural gas for power generation and serve as feedstock to the Dangote Refinery in Lagos.

This monumental deal was signed by the Managing Director of NNPCL Gas Marketing Limited (NGML), Justin Ezeala, and the President/CEO of Dangote Group, Aliko Dangote, at the Dangote Corporate Head Office in Falomo, Lagos.

A Major Milestone for Nigeria’s Energy and Industrial Sectors

The agreement aligns with President Bola Tinubu’s vision of harnessing Nigeria’s abundant natural gas resources to drive industrialization and economic prosperity. The deal, described as "unprecedented" in the history of NGML or any gas Local Distribution Company in Nigeria, involves the supply of 100 million standard cubic feet of natural gas per day (MMSCF/D) to the refinery. This will include 50 MMSCF/D in firm supply and an additional 50 MMSCF/D as interruptible supply, initially for a 10-year period with options for renewal.

NNPCL spokesperson Olufemi Soneye described the agreement as a significant step toward ensuring the operational success of the Dangote Refinery while enhancing domestic gas utilization for broader economic impact. “This milestone signifies NGML’s continued leadership in promoting the use of domestic gas to support industries and businesses nationwide,” Soneye added in a statement issued on Wednesday.

Unprecedented Collaboration for Economic Growth

This gas supply agreement is crucial to Dangote Refinery’s operations, providing power generation and essential raw materials that will help secure its position as a major player in Nigeria's refining and petrochemical industry. With a 435MW power plant, the Dangote Refinery has the capacity to meet the power requirements of an entire region, such as the Ibadan Electricity Distribution Company, marking a new era for energy self-sufficiency in Nigeria.

The deal also reflects NGML’s unwavering commitment to business excellence and its mission to fulfill NNPCL’s core mandate of ensuring the country’s energy security through the execution of strategic gas projects across Nigeria.

A Boost for Local Production and Nigeria’s Gas Revolution

This historic collaboration aligns with NNPC Ltd and Dangote Refinery’s shared commitment to bolstering local production, contributing to Nigeria’s energy infrastructure, and fostering economic development. The significance of the deal cannot be overstated—it is a key indicator of Nigeria’s evolving gas market, which has long been touted as a vital resource for driving industrialization and economic growth.

The partnership not only benefits the two entities but also the entire country, by paving the way for more efficient use of Nigeria’s gas reserves, reducing energy imports, and creating opportunities for sustainable industrial growth.

As Nigeria continues to capitalize on its vast natural gas resources, deals like this one with the Dangote Refinery will be critical to revamping the country’s industrial capacity and positioning Nigeria as a leader in global energy production.