Nigeria must move beyond its enormous oil and gas reserves to building investor confidence, guaranteeing markets and demonstrating project delivery capacity if it hopes to attract the billions of dollars required to unlock its energy potential, Managing Director and Chief Executive Officer of Nigeria LNG Limited (NLNG), Engr. Adeleye Falade, has declared.
Falade, who made the assertion at the 32nd Nigerian Economic Summit (NES) in Abuja, challenged policymakers to adopt the NLNG investment model, which successfully attracted $3 billion in financing from 31 local and international financial institutions for its Train 7 expansion project in 2020, despite the economic uncertainties occasioned by the COVID-19 pandemic.
Speaking during an interactive panel titled “Unlocking Nigeria’s Oil Potential: The Push for More Oil,” the NLNG boss maintained that Nigeria’s greatest investment challenge was not resource availability but the ability to transform those resources into credible, commercially viable and bankable projects.
“Certainty itself is the product,” Falade declared, stressing that energy investments require substantial upfront capital, with recovery periods extending between 20 and 30 years, making stable policies, predictable earnings and enforceable commercial agreements indispensable.
He explained that NLNG’s financing success was built on a proven performance record, having successfully developed six production trains and repaid the loans obtained for their construction before seeking funding for Train 7.
“Track record compounds,” he said, noting that successive project delivery and consistent loan repayment strengthened lenders’ confidence and improved the company’s access to competitive financing.
Falade identified three critical considerations underpinning major energy investments: “Who buys the product? Who carries the risk? Who stands behind the project?”
According to him, NLNG’s long-term sales and purchase agreements, some spanning 20 years, provide guaranteed commercial arrangements that enable lenders to assess projected revenues and determine the viability of financing major infrastructure projects.
He further explained that investment risks must be appropriately allocated, with buyers managing market-related exposures while project operators and contractors assume responsibility for technical and operational risks.
On operational performance, Falade disclosed that NLNG’s plant utilisation had improved to 81 per cent year-to-date, following approximately two years of operations at around 60 per cent due to feedgas supply constraints.
The improvement, he noted, demonstrated the company’s production capacity when adequate gas supplies were available, reinforcing the importance of operational reliability in sustaining investor confidence.
Beyond attracting foreign capital, the NLNG chief executive emphasised that major energy projects must deliberately strengthen Nigerian businesses, develop indigenous technical capabilities and create opportunities extending beyond individual project lifecycles.
“Capability has to be deliberately built into what you do,” he stated, citing NLNG’s vessel construction programme, during which Nigerian manufacturers supplied furniture, cables and other components.
He disclosed that some participating Nigerian suppliers subsequently secured business relationships with international companies beyond their original NLNG contracts, demonstrating how strategic local participation could open access to global markets.
Falade consequently urged policymakers to create a stable and enabling business environment that would support indigenous enterprises, sustain investment flows and allow Nigerian companies to participate competitively in successive energy projects.
He maintained that the NLNG model offers practical lessons for financing other capital-intensive developments across Nigeria’s energy industry, particularly where commercial certainty, institutional credibility and operational competence can be demonstrated.
For Nigeria, the message from the summit was unmistakable: possessing enormous energy resources may attract global attention, but predictable policies, credible operators, secured markets and proven performance are what ultimately unlock investment capital.
The 32nd Nigerian Economic Summit brought together policymakers, industry executives and other stakeholders to examine strategies for strengthening Nigeria’s investment climate, expanding energy production and translating the country’s resource wealth into sustainable economic development.
