Nigeria lures Asian, European buyers with mini-LNG, FLNG

Nigeria is exploring alternative solutions such as floating LNG (FLNG) and smaller-scale mini-LNG projects in order to fully capitalise on its gas resources and meet both export and domestic demand, analysts at Rystad Energy have said.

Nigeria has faced significant setbacks despite its strong position in Africa’s gas sector. Pipeline vandalism, oil theft, and operational disruptions have slashed the country’s LNG production efficiency, with liquefaction rates dropping from 90 percent in 2018 to just 60 percent in 2023, according to data gathered by BusinessDay

This decline has hampered Nigeria’s ability to compete with global giants like the U.S., Australia, and Qatar.

Yet, Nigeria remains a critical supplier for Asian and European markets, offering shorter shipping routes and avoiding geopolitical tensions such as the U.S.-China tariff war.

Rystad Energy explained that while Nigeria’s LNG exports are expected to recover, the country is unlikely to break into the top five global exporters soon unless it addresses infrastructure vulnerabilities.

FLNG & Mini-LNG: The game changers

“To overcome pipeline dependency and boost production, Nigeria is increasingly focusing on FLNG and modular mini-LNG solutions. FLNG technology is particularly suited for Nigeria’s offshore gas fields, where about 65 percent of the country’s gas reserves lie,” analysts at Rystad Energy said.

They added, “Unlike traditional onshore plants, FLNG units can process gas at sea, reducing exposure to pipeline sabotage and enabling faster project deployment.

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Rystad Energy said West Africa already hosts about 20 percent of the world’s FLNG capacity, and new projects could further expand this share.

“Nigeria’s undeveloped offshore gas reserves present a major opportunity for FLNG investments,” the independent energy research and business intelligence company headquartered in Oslo said.

Meanwhile, mini-LNG projects are gaining traction as a solution for domestic energy shortages. These smaller, modular plants can supply gas to industries, power plants, and transportation networks, reducing reliance on costly diesel imports.

For international buyers, mini-LNG offers flexible, scalable supply options, making Nigeria an attractive partner for long-term contracts.

Global Buyers Eye Nigerian Gas

Asian and European energy firms are increasingly turning to Nigeria for stable LNG supplies. With Europe seeking alternatives to Russian gas and Asia’s demand rising, Nigeria’s strategic location and untapped reserves make it a key future supplier.

“ 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,” Rystad Energy said.

Industry experts suggest that Nigeria must accelerate regulatory reforms, improve security, and attract foreign investment to fully capitalise on this opportunity. If successful, the country could transform its energy sector, turning gas into a major driver of economic growth.

As the global LNG market expands, Rystad Energy said by leveraging FLNG and mini-LNG technologies, Nigeria can overcome infrastructure challenges, boost exports, and meet domestic energy demands. With the right policies and investments, Nigeria could solidify its position as Africa’s gas powerhouse—providing cleaner energy to its people and lucrative opportunities for global buyers.