Investing: Gazprom set to invest in Nigeria gas
Gazprom to invest $2.5bn in Nigeria gas
Russian gas giant Gazprom wants to invest at least $2.5 billion in the development and production of Nigeria's natural gas reserves, a company official said.
Gazprom is in talks with state-run Nigerian National Petroleum (NNPC) on joint venture projects in Africa's largest oil and gas producer.
"About $2.5 billion is understood to be the Gazprom investment programme for Nigeria," said a company official working in Nigeria. "Ninety percent of it is for developing the domestic gas production, processing and transportation."
He declined to say when a final agreement may be signed with NNPC. The two sides signed a memorandum of understanding in September, said a Reuters report.
Some industry experts in Europe see Russia's keen interest in the West African country as an attempt to get a stranglehold on Europe's natural gas supplies.
Gazprom temporarily cut off supplies to thousands of Europeans last month in a price dispute with Ukraine.
The company will focus most of its initial investment on improving Nigeria's domestic gas industry, which has operated far below its full capacity because of a lack of funds and regulation.
Top Nigerian oil officials say foreign oil companies must first help build the country's gas infrastructure before it can begin to make plans to export the natural resource.
"There will be no pipelines going beyond Nigeria when we don't have enough gas to use domestically," a senior NNPC official said.
The pipelines Gazprom hopes to build in Nigeria could eventually be used to ship gas through the Trans-Saharan Gas Pipeline, a project aimed at sending Nigerian gas through Niger and Algeria to the Mediterranean.
"Gazprom is planning to invest in gas gathering, central gas processing facilities, power plants and major pipelines, which can later form part of the Trans-Saharan (pipeline)," the company official said.
"Trans-Sahara starts after the Nigerian gas grid is completed."
Gazprom's potential involvement in the giant gas pipeline, which is expected to be operational in 2015, could further strain relations with the European Union.
The EU has strongly supported the project to ease its dependence on Russian energy supplies.