Producers typically congregate around areas with a competitive advantage – cheap labour, reliable power or the presence of raw materials. This concentration creates industrial clusters – a network of interconnected producers in one location, driving innovation, employment and productivity.
Key players in Nigeria’s gas sector are conscious of the opportunities these clusters bring. In response, they are actively investing in critical gas infrastructure to supply gas for power generation in these clusters. The presence of these clusters outside Nigeria’s crowded commercial capital, Lagos, is an added advantage providing an opportunity for liberalised economic growth.
Shell Nigeria Gas (SNG) is actively leveraging this opportunity with gas distribution networks to supply industrial clusters in Aba and Port Harcourt and future plans to build clusters in Bayelsa State and Oyo State.
Axxela Limited is also committed to the development of self-sustaining industrial clusters. In March 2021, it announced the completion of an 18km gas pipeline system in Ogun State, South West, Nigeria, to supply gas to Rite Foods Limited’s large-scale factory in Ososa, Ogun State.
Falcon Corporation Limited (Falcon) is actively extending its Gas distribution infrastructure in Ikorodu to deepen Natural gas penetration in the country and recently announced the completion of Gas distribution infrastructure to supply Gas to KCSSA West Africa Limited, a subsidiary of Kimberly-Clark Corporation, an American multinational personal care company operating in over 60 countries. Falcon has also entered into a strategic partnership arrangement with the Nigerian Gas Marketing Company Limited for Gas distribution to key industrial companies in Port Harcourt and Eleme.
QSL Gas and Power Limited is also working closely with the Nigerian Gas Marketing Company Limited to distribute gas for a range of industrial and power generation applications in Edo and Ondo States
The Ajaokuta-Kaduna-Kano (AKK) 614km pipeline project initiated by the Federal Government is another opportunity for interested companies to build infrastructure connecting clusters in the Northern region to gas supply.
The industrial clusters playbook works for everyone. Gas is supplied in commercial quantities to power industries, fostering remarkable progress for Nigeria’s industrialisation drive.