NLNG Gas Supply Plunges 80% Due to Pipeline Leaks, Threatening Nigeria’s Economy
BY, Springnewsng March 4,2025
The operational crisis at Nigeria LNG (NLNG) Limited has worsened, with gas supplies to its Bonny Island facility plummeting by 80% due to ongoing pipeline leaks and vandalism. This development raises serious concerns about Nigeria’s ability to meet its export commitments and sustain economic stability.
Massive Drop in NLNG Gas Supply
Reports from Bloomberg and BusinessDay reveal that gas deliveries to NLNG have fallen to just one-fifth of the plant’s required supply. This severe disruption, primarily caused by pipeline vandalism, is straining global LNG markets, tightening supply to Europe and Asia, and potentially driving up spot prices.
According to Bloomberg data, almost half of Nigeria’s LNG exports in 2024 were directed to Asia, with one-third sent to Europe, making these regions particularly vulnerable to the supply crisis.
NLNG Operations Severely Impacted
Philip Mshelbila, Managing Director of NLNG Limited, stated that only two of the company’s six LNG trains are operational, significantly reducing output. Speaking at the Nigeria International Energy Summit, Mshelbila highlighted the worsening situation:
“Energy security must be viewed as national security. Gas security is deteriorating, and until we can protect these pipelines, we will continue to underperform.”
The company has been forced to scale back production, impacting its ability to fulfill international contracts. The worsening gas supply crisis could further disrupt global energy markets, already strained by geopolitical tensions.
Economic Fallout for Nigeria
NLNG plays a crucial role in Nigeria’s economy, contributing billions in revenue. The continued decline in gas exports is a major blow to government earnings and foreign exchange reserves.
- Nigeria’s LNG exports dropped 40% in February compared to January, further impacting revenue.
- Projected dividends of N727 billion to the Nigerian government by 2025 could be at risk due to ongoing disruptions.
- Over the past 25 years, NLNG has paid $21.56 billion of its $44 billion dividends to the Nigerian government.
Urgent Need for Security Measures
The Niger Delta region, notorious for militant activities and pipeline sabotage, remains a key threat to NLNG’s operations. Experts warn that without a robust security strategy, Nigeria’s gas sector will continue to suffer, affecting both domestic energy supply and international trade obligations.
With global LNG demand rising, securing NLNG’s pipelines is critical to ensuring Nigeria remains a competitive player in the international energy market while stabilizing its economic outlook. Immediate government intervention is needed to safeguard infrastructure and prevent further disruptions to this vital sector.
