Out of the $80bn gas-to-power projects planned to be established in Nigeria, only $1bn has been committed to these projects by investors, an oil and gas report seen on Sunday showed.

In the report, which was put together after the recently concluded policy dialogue on Nigeria’s Decade of Gas plan, stakeholders in the sector stated that financing for natural gas projects had been on the decline due to the push for climate-friendly projects.

The policy dialogue from where the report emanated, was organised by the African Initiative for Transparency, Accountability and Responsible Leadership, in conjunction with the Natural Resource Governance Institute.

The document read in part, “There is dwindling financing for natural gas projects globally, posited to be based on a preference for environmentally sustainable and climate-friendly projects.

“A reflection of this is the fact that out of the several gas-to-power projects (estimated at $80bn) that are planned to be established in Nigeria, only $1bn has been committed to these projects, with the other projects being in negotiation stages, facing several challenges for many years.

“Another dimension to the drop in financing is the increased risks of gas projects to infrastructure lock-ins and stranded assets, non-profitability and bankability of gas projects, and other technical issues.

“Against this backdrop, there is a need to adopt an approach that focuses on one or two profitable brown gas projects rather than the 10 planned, in order to ensure there could be some marginal success.”

The document stated stakeholders at the dialogue observed that financing gas projects would be difficult, but pointed out that all hope was not lost.

It added, “Options for funding include international development banks and the opportunities offered by the ideation of the novel African Energy Bank. Also, there is a need to provide appropriate risk evaluation of these projects to help allocation of credits for project funding.

“Financing for gas needs to be brought up at COP28 through advocacy for funding technologies that can reduce the emissions capacity of natural gas,” they stated in the report.”