Transportation of Natural Gas in Nigeria

: Management Trends and Challenges in the Energy Trilemma

Abstract

This dissertation offers an in-depth analysis of Nigeria's natural gas transportation infrastructure and its role in addressing the energy trilemma of equity, security, and sustainability. As a major global producer of natural gas, Nigeria faces unique challenges in terms of balancing its economic development, environmental sustainability, and energy security in the context of a developing economy. This study aims to understand how natural gas availability influences broader access to energy, economic fairness, and sustainability, offering valuable insights for policymakers, stakeholders, and scholars interested in Nigeria's energy future.

This dissertation begins by outlining the research problem, focusing on Nigeria’s natural gas sector and its significance to the national energy policy. This highlights the relevance of natural gas infrastructure in balancing Nigeria's energy needs with its environmental and social obligations. The objectives of the study, research questions, and structure were clearly defined, which guided subsequent analysis.

Utilising a robust mixed-methods approach, this study incorporates both quantitative and qualitative data to explore Nigeria’s natural gas sector from multiple perspectives. This study incorporated two open-ended and closed-ended surveys to gather qualitative and quantitative data from Nigerian stakeholders. The longer survey collected data from Nigerian experts working in the energy sector. A shorter survey was employed to collect data from experts in Nigeria and from residential stakeholders. The research survey questions were developed using the energy trilemma framework to analyse the expertise and perceptions of respondents regarding the development of natural gas transportation infrastructure in Nigeria.

This literature review provides historical insights into natural gas exploration and utilisation in Nigeria, with a focus on domestic access and export strategies, infrastructure ownership, governance frameworks, and institutional influences. This underscores the importance of governance and institutional structures in shaping investment patterns, environmental sustainability, and alignment with Nigeria’s net-zero commitment.

The theoretical framework combines institutional theory with the energy trilemma to offer a nuanced perspective on the governance of Nigeria’s natural gas infrastructure. This framework allows for the analysis of how governance, regulatory policies, and institutional practices influence the broader objectives of Nigeria’s energy transition.

The findings reveal a strong correlation between access to natural gas and positive economic outcomes. Quantitative analysis demonstrates that natural gas availability is directly linked to employment growth, increased tax revenue, and higher labour income. Regression analysis highlighted that investments in natural gas infrastructure, particularly pipelines and technology, are crucial for job creation and economic growth. Areas with better access to natural gas significantly contribute to government revenue, enhanced public services, and long-term economic stability. Industries reliant on natural gas also see wage growth, as expanded gas infrastructure increases the demand for skilled labour and fosters technological innovation.

This study underscores the importance of natural gas infrastructure in sustaining Nigeria’s long-term economic growth, particularly in sectors such as manufacturing and power generation. Correlation and regression analyses from 1990 to 2022 show that natural gas consumption explains 30.2% of the variability in Nigeria’s GDP growth, highlighting its crucial role in the national economy.

Despite these benefits, this study identifies several challenges that hinder the full potential of natural gas in Nigeria. Infrastructure deficiencies, including outdated pipelines and insufficient investments, are major barriers to efficient gas transportation. Security risks include pipeline vandalism and theft, complicated operations, and high cost. Political and regulatory instability also deters investments. However, the high capital costs of infrastructure development make it difficult for small firms to compete with international players.

Environmental considerations were central to the findings of this study. Although natural gas infrastructure reduces gas flaring and contributes to lower greenhouse gas emissions, the risks of spills, leaks, and explosions pose significant threats to local ecosystems. Strict regulatory oversight and advanced technologies such as digitised monitoring systems are necessary to mitigate these environmental risks.

This dissertation concludes with strategic policy recommendations to address these challenges and optimise Nigeria’s natural gas infrastructure. This calls for improved governance, regulatory transparency, and continued investment in infrastructure and technology to ensure sustainability. A stable policy environment is essential to attract investment and enable Nigeria to harness its natural gas resources for domestic development, and its role as a key player in the global energy market.

This dissertation makes a significant contribution to the understanding of Nigeria’s natural-gas transportation infrastructure and its impact on economic development, environmental sustainability, and energy security. It offers critical insights for policymakers, industry stakeholders, and scholars, emphasising the need for a stable policy, regulatory reform, and strategic investments. This study also highlights the importance of future research on the energy trilemma in developing countries by offering a comparative perspective on global energy strategies.

Date of Award	2024
Original language	English
Awarding Institution	University of Dundee
Supervisor	Peter Cameron (Supervisor) & Jennifer Considine (Supervisor)