Nigeria eyes new options to maximize gas resources amid Africa's LNG surge

Africa is set to play a pivotal role in the global gas industry in the coming years as the world’s liquefied natural gas (LNG) production capacity soars from 486 million tonnes per annum (Mtpa) last year to 755 Mtpa in 2030, according to Rystad Energy’s latest projections. This explosive growth will be fueled by rising gas demand in regions with limited local production or access to pipeline supplies. Africa hosts about 20% of the 477 Mtpa total —around 93 Mtpa— of global LNG capacity in the pipeline, comprising under-construction projects, confirmed final investment decision (FID) or pre-FID.

Western Africa, led by Nigeria, produces nearly half of the continent's LNG, and Rystad Energy forecasts that the country’s LNG exports will rise 20 million tonnes (Mt) by 2030. Nigeria may need to explore alternative solutions such as floating LNG (FLNG) and smaller-scale mini-LNG projects in order to fully capitalize on its gas resources and meet both export and domestic demand.

Despite growing global demand, production issues and vandalism have contributed to Nigeria’s annual liquefaction rates dropping from an average of 90% in 2018 to 60% last year, demonstrating the extent of the disruptions and signaling the need for urgent action to capitalize on its competitive edge.

Africa is home to the highest concentration of FLNG infrastructure in the world, underscoring its growing importance in the global gas market. The continent currently boasts an onshore LNG production capacity of approximately 70 Mtpa, accounting for around 14% of the global total. West Africa leads the charge within Sub-Saharan Africa, producing more than half of the region’s LNG last year and is targeting a 50% increase by 2030. At the heart of this growth is Nigeria, which contributes nearly two-thirds of West Africa’s LNG output and over one-third of the continent’s total —cementing its role as a cornerstone of Africa’s LNG ambitions on the global stage.

Nigeria has consistently ranked among the top LNG producers globally, despite export volumes being much smaller than those of the US, Australia and Qatar. Nigerian LNG, which is positioned outside the ongoing US tariff war, offers crucial flexibility for Asian and European buyers thanks to its strategic location and shorter transit times compared to US LNG exports. However, ongoing pipeline vandalism and oil theft continue to hinder Nigeria’s ability to fully capitalize on its resources. While we expect Nigeria's LNG exports to recover, they are unlikely to place the country among the top five global exporters in the near future,

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Rystad Energy analysis shows that Nigeria's declining LNG production has reduced West African exports in recent years. Yet, the region still contributed more than 60% of Africa's LNG exports last year—a total of 22.7 Mt. New liquefaction projects are expected to boost the region's capacity to 50.6 Mtpa by 2035 through onshore developments in Nigeria and Gabon, along with various FLNG projects that are set to begin in the next decade.

West Africa's gas resources consist of about 65% offshore and 35% onshore. The onshore sector is more developed, with over two-thirds already in production or development. Conversely, nearly two-thirds of its offshore gas —around 16 billion barrels of oil equivalent— remain undeveloped. These resources are ideal for FLNG technology, being less dependent on vulnerable pipeline infrastructure. Currently, West Africa holds about 20% of the world's FLNG capacity, with potential for further growth if more gas resources are tapped for LNG exports.

Contacts

Antonia Syn
Analyst, Commodity Markets
Phone: +47 24 00 42 00
Antonia.Syn@rystadenergy.com

Ole Dramdal
Senior Analyst, Commodity Markets
Phone: +47 24 00 42 00
Ole.Dramdal@rystadenergy.com

Laura R. Skaug
Media Relations Manager 
Phone: +47 973 17 112
laura.skaug@rystadenergy.com 

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