| Work Detail |
The construction of Africa’s largest gas-to-methanol plant in West Africa takes shape as Africa Finance Corporation comes on board. The company is hailed as the continent’s infrastructure solutions provider as it has facilitated the delivery of various projects. The implementation of the project aims to significantly reduce carbon emissions by offsetting the flaring of natural gas. It will instead turn it into a valuable chemical for solvents, paints, plastics and car parts. The project in Akwa Ibom, Nigeria, targets producing an initial 1.8 million tonnes of methanol per annum (MTPA). It also seeks to diversify the local economy and generate over 18,000 jobs. AFC has committed to development stage financing to de-risk the project and enable it to reach financial close. Furthermore, it seeks to provide financial advisory services to the sponsors to raise the required project financing and support the successful delivery of this transformational project.
The State of Affairs Regarding Africa’s Largest Gas-to-Methanol Plant
The implementation of Africa’s largest gas-to-methanol plant is a venture led by Blackrose, a project development and investment firm. Furthermore, it is co-developed with the International Finance Corporation (IFC), the private sector arm of the World Bank Group. The organizations are co-financing alongside the AFC. Through this, it will be possible to leverage Nigeria’s enormous potential in natural gas. Most of Nigeria’s 200 cubic feet of natural gas reserves, the largest in Africa, accounting for a third of the continent’s total. However, this remains unexploited, presenting a substantial opportunity to bolster the country’s natural resource beneficiation and enhance climate resilience. Gas flaring has been a significant hazard for local people since the beginning of oil production. It has emitted chemicals linked to respiratory and other health issues. Upon its completion, the project will effectively address this hazard.The Significance of the Massive Project in West Africa.
The project’s significance is expected to be impactful as it will benefit Nigeria and neighbouring regions in West Africa. “This innovative project is transforming an immense negative for Nigerians into a significant positive. It will harness this country’s abundant gas reserves as a unique opportunity to become a global leader in low-carbon manufacturing and energy systems,” said Samaila Zubairu, President and CEO of AFC. “This strategic collaboration with Blackrose and IFC underscores our dedication to supporting Africa’s pragmatic transition to net zero.It also emphasises rapid industrialisation, local job creation, and socio-economic advancement through producing methanol, a versatile and low-carbon industrial feedstock.” Africa’s largest gas-to-methanol plant will be implemented in two phases, each with an installed capacity of 1.8 MTPA. Phase one will produce low-carbon methanol, an industrial chemical essential to manufacturing hundreds of everyday products. These include solvents for the pharmaceutical industry, paints, plastics, automobile parts and construction materials.
The Project as a Game Changer in the Production of Natural Gas
Once completed, Africa’s largest gas-to-methanol plant is expected to be a game changer in producing natural gas in Africa. Methanol is produced using gas, mostly from coal and natural gas. Utilizing best-in-class energy-efficient production methods, the plant will achieve a much lower net carbon intensity than traditional methanol synthesis techniques. Furthermore, it will reduce carbon emissions by converting gas that would otherwise have been flared. Additionally, the project incorporates plans for carbon capture and offset strategies. It also entails using external hydrogen to bring targets closer to carbon neutrality. Once operational, the gas-to-methanol plant is expected to generate more than 2,500 local jobs during construction. It will indirectly provide a further 16,000 jobs by catalysing manufacturing activity and economic diversification. |
