Dangote courts Blackstone to boost Nigerian gas

29 April 2015

Aliko Dangote plans to quadruple the supply of gas to Nigeria by building pipelines that may be backed by Carlyle Group LP and Blackstone Group LP, the world’s two biggest private-equity firms.

Dangote will invest $2.2 billion to $2.5 billion in two sub-sea 550-kilometre pipelines running from Nigeria’s oil and gas-producing Niger River delta region to the commercial hub of Lagos.

The pipelines will increase the amount of gas available in Africa’s biggest economy to 4 billion standard cubic feet per day from 1 billion, he said.

While Nigeria has gas reserves of about 180 trillion cubic feet, more than any other African country, most of what’s produced is flared or exported because of a lack of infrastructure to transport it to local companies and households.

Boosting domestic supply will help increase electricity generation in a country where power cuts are common and about 70% of electricity plants are fuelled by gas, according to Dangote.
Dangote plans to start laying the pipelines before the end of the year and the first should be ready by mid-2017.

“But 2018, in the worst case, the Dangote Group will be able to export about $8 billion to $10 billion worth of goods,” he said. “We are totally transforming the business to be export-orientated.”


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