Business
Nigeria Needs More Investment To Achieve 195,400Mw Energy Deficit
For Nigerians to enjoy constant electricity supply, there is the need for more investments in the sector that will culminate in the country being able to generate 200,000 MegaWatts (MW).
This means Nigeria needs additional 195,400 megawatts to meet its electricity needs, because it generates an average of 4,600MW for a population of 200 million.
Group Managing Director, Mojec International Limited, Chantelle Abdul, disclosed this at the yearly international conference of the Association of Energy Correspondents of Nigeria (NAEC) in Lagos.
She said low energy generation was responsible for frequent blackouts in the country.
“Based on international standards of 1 GW (1000MW) to one million people, the country is expected to, at least, generate 200GW (200,000MW) to give the population better access to electricity.
“Nigeria has the capacity to generate 12.5GW (12,000MW) of electricity, but owing to different reasons, the 29 generation companies (GenCos) are only able to generate, transmit and distribute between 3GW to 5GW (3,000MW to 5,000MW)”, Abdul said.
She said Nigeria, Africa’s most populous country, faces surging electricity demand owing to rapid urbanisation and industrialisation.
According to her, before 2023, there were 26 gas-powered plants and three hydro plants, but the approval of 11 new GenCos in the year had taken the electricity generating plants to 40, with the country’s transmission wheeling capacity standing at about 8.1 GW (8,100MW).
She expressed hope that the new Electricity Act would pave way for more investment into the sector to allow states to generate, transmit and distribute their electricity.
Egbin has the highest capacity as a gas plant to produce 1.39GW (1,390MW), and Kainji Jebba Power Plc has the highest capacity as a Hydro plant to produce 1.33GW (1, 330MW).
Abdul said solar plants could be introduced to the state governments to serve as a means to generate electricity for their various regions.
In a related development, Nigeria will need about $25 billion of yearly investment in the next 10 years to achieve crude oil output of 4 million barrels per day and 3 billion cubic feet per day of domestic gas production, Executive Chairman, AA Holdings, Austin Avuru, has said at the conference.
Speaking on the theme, “Nigeria’s Energy Transition: Enhancing investment opportunities & addressing challenges in the energy sector”, Avuru said Nigeria should focus more on energy security and optimise the value of its oil and gas resources before committing to its energy transition agenda.
He explained the energy transition agenda is a lot more serious than an issue that has to do with carbon emissions in the country, adding that carbon emissions reduction has been the key factor that all the energy transition argument has been hinged on.
Most countries have focused on addressing energy security and optimising the available resources while driving the transition.
The Executive Chairman said every country would address these two things before coming to what some people think is the residual matter of reduction of carbon emission.
He underlined the need Nigeria should prioritise energy security for both now and in the future and optimise the value of the numerous energy resources that it has today, while still pushing the energy transition agenda.
Avuru said if the government must prioritise the energy transition agenda, it should have raised the country’s crude oil production to about three to four million barrels per day presently; then, reduce production to one million barrels daily by 2040.
He believed the country should have achieved domestic gas production of four billion cubic feet per day between now and 2030.
To curb the incessant oil theft in the country, the Nigerian Upstream Regulatory Commission (NUPRC) has introduced the Advanced Cargo Declaration regime in upstream petroleum operations to arrest oil robbery and curtail export of stolen crude oil.
The commission also stated its plans to reactivate shut-in wells as part of initiatives to increase oil and gas production in the country.
The Commission Chief Executive, Gbenga Komolafe said this intervention at the conference, represented by Abel Nsa, Head of the National Oil and Gas Excellence Centre (NOGEC) Department, NUPRC, said the initiative aims at ensuring that crude oil and gas cargoes exported from Nigeria have a unique identifier that confirms all documentation as regards the exported consignment.
‘‘This implies that any cargo without the unique identifier becomes tagged as illegitimate. This, by no small measure, enhances transparency in our export operations”, he stated.
He said NUPRC had deployed key resources to the Special Investigative Unit of the Commission to forestall any cases of sharp practices by operators in the sector.
‘‘Over the next few months, we are positive that we shall record a marked increase in our national oil and gas production volumes.
“Quick-win strategies such as our aggressive drive to reactivate shut-in and declining wells will boost production prior to the onset of more long-term initiatives like operations from the new marginal field awardees.
“Also, the Commission is working alongside security operatives to bring a halt to the menace of crude oil theft, which has over the years contributed to a huge loss of production”, he said.
The Commission Chief Executive added that the agency had begun the implementation of the Drill or Drop Provision with a comprehensive review of assets which had been undeveloped by operators.
Such assets, he said, would be placed in a basket and then offered to willing and qualified investors with the capacity to explore, develop and produce the block(s) or field(s) in a timely, efficient, safe, and environmentally friendly manner.
He stated that the ongoing mini bid round for seven Deep Offshore Petroleum Prospecting Licences (PPLs) would boost the nation’s reserves as well as bring about anticipated benefits to the nation and other stakeholders.
On reduction in unit cost per barrel and revenue, he explained that the Commission is committed to ensuring a significant reduction in the cost of doing business in the upstream petroleum industry.
‘‘Following an in-depth comparative analysis between the Unit Operating Cost (UOC) in Nigeria and those obtainable in other climes
“We have commenced the development of cost studies and benchmarks to ensure an improvement in the cost efficiency of our upstream petroleum operations, in accordance with Section 8 of the Petroleum Industry Act 2021.
The NUPRC has also begun a review of all Crude Handling Agreements (CHA) with a view to entrenching openness and competitiveness, thereby reducing the cost of production while increasing government revenue from the sector. It is noteworthy that in the year 2022, using the strategies listed above, the Commission outperformed its revenue collection target by 18.3 per cent’’, he explained
Komolafe maintained that the Commission had stepped up efforts toward transparency in the sector and that transparency in hydrocarbon accounting was essential in ensuring maximum value derivation by the government and stakeholders.
According to him, transparency is essential to ensuring security of investments made by our financial partners.
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The Niger Delta Development Commission (NDDC) has signed a Memorandum of Understanding (MoU) with the Rural Electrification Agency (REA) to expand access to reliable and sustainable electricity across the Niger Delta region.
The agreement, signed at the headquarters of the REA in Abuja, was targeted at strengthening institutional collaboration and accelerating development in underserved communities in the region.
A statement by the Director, Corporate Affairs of the NDDC, Seledi Thompson-Wakama, said the pact underscores renewed efforts by the two federal interventionist agencies to deepen cooperation and fast-track infrastructure delivery.
Speaking at the signing ceremony, the Managing Director of the NDDC, Dr Samuel Ogbuku, described the MoU as a strategic step towards realising the Commission’s vision to “light up the Niger Delta” in line with national priorities on distributed energy expansion.
Ogbuku said the agreement represents a shared institutional responsibility to deliver reliable energy solutions that will enhance livelihoods, stimulate local economies and create broader opportunities across the nine Niger Delta states.
According to him, electricity remains a critical enabler of national development, supporting job creation, healthcare delivery, education and inclusive economic growth.
He noted that the collaboration would help unlock the economic potential of rural communities while advancing broader national development objectives.
The NDDC boss added that the Commission has consistently adopted partnership-driven approaches in executing projects in the region and is prepared to support the implementation of the MoU by leveraging its community presence and infrastructure development capacity.
He reaffirmed the Commission’s commitment to working closely with the REA to ensure the timely and effective execution of the agreement.
The NDDC delegation at the event included the Executive Director, Projects, Dr Victor Antai; Executive Director, Corporate Services, Otunba Ifedayo Abegunde; Director, Legal Services, Mr Victor Arenyeka; Director, Finance and Supply, Mrs Kunemofa Asu; and Director, Liaison Office, Abuja, Mrs Mary Nwaeke.
In his remarks, the Managing Director of the REA, Dr Abba Abubakar Aliyu, described the MoU as a natural collaboration between two agencies with complementary mandates, reflecting a shared commitment to expanding access to sustainable electricity in rural communities.
Aliyu said the Niger Delta remains central to Nigeria’s economic fortunes and must be supported by infrastructure capable of driving productivity, enterprise and improved living standards, adding that the partnership signals readiness to deliver stable power to communities that have long awaited reliable electricity supply.
By: King Onunwor
Artificial intelligence is often viewed as a catalyst for electrification and subsequently decarbonization. Yet one of its most immediate effects may be the opposite of what many assume. The rapid buildout of AI infrastructure is increasing demand for reliable power, and that reality could strengthen the role of natural gas and other dispatchable energy sources for many years.
Investors focused on semiconductors and software valuations may be overlooking a key constraint. AI runs on electricity, and those electricity systems operate within physical and economic limits.
The energy sector has spent much of the past decade grappling with slow load growth. That is now changing, in a way that is reminiscent of the sharp rise in oil demand—and subsequently price—in the early 2000s.
Training large language models and operating advanced AI systems requires enormous computing resources. Hyperscale data centers are expanding rapidly, with developers requesting gigawatt-scale interconnections from utilities. In several regions, electricity demand forecasts have been revised upward after years of flat expectations.
This shift is significant because AI workloads create continuous, high-density demand rather than intermittent usage. Data centers cannot simply power down when the electricity supply becomes constrained. Reliability becomes paramount.
Wind and solar capacity continues to expand, but intermittent generation alone cannot meet the firm capacity needs of AI infrastructure without significant storage or backup generation.
Battery storage is improving, yet long-duration storage remains costly at scale. Nuclear projects face long development timelines and complex permitting hurdles. Transmission expansion also lags demand growth in many regions.
These constraints make dispatchable power sources critical. Natural gas plants can ramp quickly, operate continuously, and be deployed faster than many alternatives. As a result, gas-fired generation is increasingly viewed as a practical solution for supporting AI-driven load growth.
This does not undermine the role of renewables. In many markets, new renewable capacity is paired with gas generation to maintain grid stability. The key point is that AI-driven electrification is likely to increase fossil fuel usage in the near term.
Construction timelines favor gas-fired generation when demand rises quickly. Existing pipeline infrastructure reduces barriers to expansion. And for operators of data centers, reliability often outweighs ideological preferences. Downtime is simply too expensive.
Utilities are also revisiting resource plans as load forecasts rise. That shift may drive increased investment in transmission, grid modernization, and flexible generation assets.
The Decarbonization Story Is Complex
A common narrative holds that AI accelerates the transition away from fossil fuels because it increases electrification. The reality is more nuanced.
If electricity demand outpaces the buildout of low-carbon capacity, fossil generation may still increase in absolute terms even as renewables gain market share. Total emissions could rise, but the carbon intensity of the energy system may trend lower as cleaner sources make up a larger share of supply.
Ultimately, energy systems evolve based on engineering and economics, not just policy goals or market narratives.
Rising power demand could benefit utilities investing in transmission and generation capacity. Natural gas producers and midstream companies may see structural demand support from increased power-sector consumption. Equipment suppliers tied to grid reliability and gas turbines could also gain from the shift.
Longer term, advances in nuclear, storage, or efficiency may change the trajectory. For now, the immediate response to surging electricity demand is likely to rely on technologies that can be deployed quickly and reliably.
Artificial intelligence may reshape the economy in profound ways. One of the least appreciated consequences is that it may extend the relevance of natural gas as the world builds the energy backbone required to power the next generation of computing.
By: Robert Rapier
Ogun State is set to join the comity of oil producing states in the country following the discovery and subsequent approval of commercial oil exploration activities in the Eba oil well, in Ogun Waterside Local Government Area of the state.
A technical team from the Nigerian National Petroleum Company Limited (NNPCL) has visited the area as preparations are in advanced stage for commencement of commercial drilling operations in the state.
The inspection followed President Bola Ahmed Tinubu’s approval for commercial exploration, forming part of the federal government’s efforts to deploy the required technical capacity and infrastructure for production.
Officials of NNPCL carried out the exercise alongside representatives of the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) and national security agencies to evaluate the site and confirm its readiness for drilling activities.
The delegation was led by Project Coordinator for Enserv, Hussein Aliyu, who headed the NNPCL Enserv technical team.
Other members included Wasiu Adeniyi, Onwugba Kelechi, Engr. Rabiu M. Audu, Ojonoka Braimah, Ahmad Usman, Akinbosola Oluwaseyi, Salisu Nuhu, James Amezhinim, Yusuf Abdul-Azeez, Amararu Isukul and Livinus J. Kigbu.
Speaking, Governor Dapo Abiodun, described the development as a landmark achievement for Ogun State, saying “the commencement of drilling at Eba would stimulate economic growth, create employment opportunities and attract increased federal presence to the state’s coastal communities.
Abiodun also expressed appreciation to President Tinubu for his support toward the development of frontier oil basins and the equitable spread of the nation’s energy resources.
Recall that geological reports had earlier confirmed the presence of hydrocarbons within the Ogun Waterside axis, leading to preliminary surveys and technical engagements by NNPCL.
The Ogun State Government also carried out an independent verification of the oil well’s coordinates, affirming the discovery is located within the state’s boundaries.
To secure the project, naval security personnel have been deployed to the site for over 18 months, with the support of the Ogun State Government, to protect the facility and its environs.
The Eba oil well is regarded as part of Nigeria’s strategic move to expand oil production beyond the Niger Delta region.
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