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Axxela Limited, a leading African gas and power company owned by Helios Investment Partners and Sojitz of Japan, has announced a Final Investment Decision to develop a 50 million standard cubic feet per day (MMscf/d) gas processing plant in Delta State, as it pushes towards sustainable energy solutions in Nigeria. This decision is bolstered by Axxela’s successful ₦16.4 billion bond issuance earlier this month, which was oversubscribed by 109 percent. The announcement comes as Axxela continues to expand its footprint in the energy sector, following last year’s agreement with BUA Group, one of Africa’s largest conglomerates, and CIMC ENRIC, a global leader in the energy equipment industry, to build a 700-ton-per-day mini liquefied natural gas (LNG) project. The new gas processing plant, expected to begin operations by the end of 2024, will start with a 12 MMscf/d modular unit and is designed for rapid expansion, with the potential to increase the plant’s output to 50 MMscf/d within 18 months. It is a key part of Axxela’s strategy to support the Nigerian government’s Decade of Gas initiative and to enhance domestic gas utilization. Strategically located in OML 152, the gas processing plant is expected to serve as a central processing hub for surrounding oil & gas operators, with the potential to transform gas flaring into a valuable economic resource, and significantly reduce CO2 emissions. “We are positioning to develop requisite infrastructure for natural gas processing and last mile distribution that creates market access for at least 20% of Nigeria’s gas demand,” Axxela’s Director of Business Development, Franklin Umole, said in a company statement. “Over the past two decades, we have been at the forefront of natural gas advocacy, and this project is a further reaffirmation of our dedication to gas infrastructure development and our vision to deliver innovative energy solutions across Nigeria and Africa.’’ In preparation for the project, Axxela has secured a long-term feedstock supply agreement with a leading local upstream company and established equipment supply arrangements with top-tier Original Equipment Manufacturers (OEMs). Upon completion, the processed gas will support various market segments, including Compressed Natural Gas (CNG) for vehicles, industrial feedstock, and decentralized power solutions, marking a significant step towards energy security and economic growth in Nigeria. Boost from successful bond issuance In a related financial achievement, Axxela recently raised ₦16.4 billion in an oversubscribed bond issuance, despite challenging economic conditions marked by rising interest rates and limited market liquidity. The funds will be instrumental in realizing the gas plant project. “This is a significant indicator of increasing investor confidence in our company’s reputation, brand, and performance,” CEO at Axxela Bolaji Osunsanya said. “The bond proceeds will support the development of our growth projects, signifying the importance of local and international capital markets in the development of critical infrastructure.” With the FID and successful bond issuance, Axxela looks to advance Nigeria’s gas infrastructure, support the energy transition, and meet the increasing demand for cleaner energy solutions.
The race to host the headquarters of the Africa Energy Bank, a new institution aimed at financing the continent’s energy sector, is heating up as seven countries compete to meet the criteria before the end of March. The bank, which is expected to launch by June 30, 2024, is an initiative of the African Petroleum Producers Organization (APPO), a group of 18 oil and gas producing nations. The bank will have an initial share capital of $5 billion, and each member country of APPO is invited to subscribe $83.3 million, according to Omar Farouk Ibrahim, the secretary general of APPO. The criteria to host the headquarters are: having an office building available, subscribing to the share capital of the bank, and signing a host government agreement, Ibrahim said at the Nigeria International Energy Summit in Abuja on Tuesday. The seven countries that are in the running are Algeria, Egypt, Nigeria, Ghana, South Africa, Benin Republic, and Côte d’Ivoire. “This is a real competion,” Ibrahim said. Ghana has been very aggressive in pursuing the bid and has met some or is working hard to meet all of the criteria, he noted. Nigeria, however, feels that it deserves to host the bank, as it had initially wanted to host the APPO headquarters, which went to Brazzaville, Congo. The bank is part of APPO’s vision to create a new model for financing and growing the African energy industry. Ibrahim invited all stakeholders who believe in the role of oil and gas in providing a global energy mix to partner with APPO in its projects, which include the bank, the regional centers of excellence, and the provision of cross-border and regional energy infrastructure. The bank is open to investors from outside APPO and Africa, but not just to anyone, Ibrahim said. He said that APPO would ensure that the bank is not influenced by any political or ideological agenda and remains committed to a sustainable development of African hydrocarbons resources. The final decision on the headquarters will be made by the APPO council of ministers, which is expected to meet before the end of March.
