LNGOil and GasReview of the Central Bank of Nigeria Framework for the Implementation of Intervention Facility for the National Gas Expansion Programme  

August 11, 2021by megathos0

The Central Bank of Nigeria, has issued a framework for the N250 billion ($606,892,500.00) Intervention Facility for the National Gas Expansion Programme

The 46 Million Metric Tons per Annum of LNG, available in Africa from 6 LNG producing countries, while China has over 22 LNG import terminals, the first LNG import terminal for Africa is being slightly delayed. This is a clear indicator that the Africa as a whole, is just waking up to the reality, that natural gas can be used to power Africa’s development.

The Minister of State for Petroleum Resources, Chief Timipre Sylva, in recognizing the value of natural gas a catalyst for development, has designated this decade as the decade of gas, even as he also announced the discovery of 206 TCF of natural gas.
With the world actively taking steps to go green, it becomes imperative for Nigeria to begin to actively monetize its abundant gas resources. Earlier on the Minister had set up the National Gas Expansion Programme (“NGEP”) committee to catalyze the gas utilization and investment in Nigeria.

The 2017 National Gas Policy, (which Megathos Law Practice was privileged to help review) was designed to put Nigeria on the path to rapid industrialization via the development of a gas based economy and rapid monetization of Natural Gas through the development of the natural gas value chain.

Regardless of the drive for increased gas monetization and investment, the absence of an appropriate framework for financing of gas infrastructure has proved to be a spoiler.

N250 Billion Intervention facility for Gas

Hence the announcement by the Central Bank of Nigeria, of a framework for the Implementation of a N250 Billion Intervention facility for Gas.

As part of its efforts at stimulating finance to critical sectors of the economy, the Central Bank of Nigeria (CBN) introduced the N250 billion intervention facility (“The Facility”) to help stimulate investment in the gas value chain. Large-scale projects under the intervention will be financed under the Power and Airlines Intervention Fund (PAIF), in line with existing guidelines regulating the PAIF, while small-scale operators and retail distributors will be financed by the NIRSAL Microfinance Bank (NMFB) and / or any other Participating Financial Institution (PFI) under the Agribusiness/Small and Medium and Medium Enterprises Investment Scheme (AgSMEIS).


Objectives of the Facility

The objectives of the Facility include:

  1. Improved access to finance for private sector investments in the domestic gas value chain;
  2. Stimulate investments in the development of infrastructure to optimize the domestic gas resources for economic development;
  3. Fast-track the adoption of CNG as the fuel of choice for transportation and power generation, as well as LPG as the fuel of choice for domestic cooking, transportation and captive power;
  4. Fact-track the development of gas-based industries particularly petrochemical (fertilizer, methanol, etc) to support large industries, such as agriculture, textile, and related industries;
  5. Provide leverage for additional private sector investments in the domestic gas market;
  6. Boost employment across the country.


  1. Aggregators, manufacturers, processors, wholesale distributors and related activities shall be funded under the Power and Airline Intervention Fund (PAIF).
  2. Small and medium-scale enterprises (SMEs) and retail distributors shall be funded by NIRSAL Microfinance Bank (NMFB) under AgSMEIS.


Loan Type and Limit

Manufacturers, Processors, Wholesale Distributors, etc.

  1. Term loan: Shall be determined based on the activity and shall not exceed N10 billion per obligor.
  2. Working capital: Maximum of N500 million per obligor

Small & Medium Enterprises (SMEs) and Retail Distributor

  1. Term loan: Shall be determined based on the activity and shall not exceed N50 million per obligor.
  2. Working capital: Maximum of N5 million per obligor.

Responsibility of Beneficiaries

  1. Adhere strictly to the terms and conditions of the Facility;
  2. Ensure prudent utilization of facility for the purpose for which it was granted;
  3. Keep up-to-date records of the enterprise’s activities under the intervention;
  4. Allow access to the project and records by the CBN and PB;
  5. Repay the facility in accordance with the approved repayment schedule; and
  6. Comply with the provisions of the Guidelines.

The Facility is to be implemented by the CBN in conjunction with the Ministry of Petroleum Resources.

The age of natural gas has just begun in Africa, it is refreshing to note that the CBN and the Ministry of Petroleum Resources are taking the lead to put Nigeria at the forefront of natural gas monetization in Africa.

To learn more, please reach out via www.megathoslaw.com




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