With financing in place, UTM Offshore says it is on course to make a Final Investment Decision on Nigeria’s first floating LNG project in September, enabling construction to start in the first quarter of next year. Julius Rone, Group Managing Director said during Nigeria Oil and Gas Week in Abuja that the project will support gas monetisation, reduce gas flaring, strengthen domestic Liquefied Petroleum Gas supply and position Nigeria as a more attractive destination for energy investment.
UTM Offshore has set its sights on a final investment decision in September for what would be Nigeria’s first floating liquefied natural gas project, a crucial milestone for a development the company says could free up stranded offshore gas, reduce flaring and boost domestic fuel supplies.
“The project now has financing in place, which gives it the momentum to move from agreements and contracting into execution,” UTM Offshore Group Managing Director Julius Rone told CNBC Africa on the sidelines of Nigeria Oil and Gas Week in Abuja.
“Today is a great day for not just Nigeria, for the world, because in signing this gas agreement underpins that this project can proceed into the next stage,” Rone said, adding that the deal creates the certainty needed to advance the project through final investment decision, financing closeout and constructionRone says UTM Offshore is working towards a FID in September, with further milestones scheduled before year-end.
The company expects to sign the gas supply agreement and the engineering, procurement, construction, installation and commissioning contract before Christmas, allowing construction to start in the first quarter of next year, he said.
The timeline is important for Nigeria’s gas sector, which has long struggled to monetize large offshore resources, much of them stranded by limited infrastructure. Floating LNG, or FLNG, is designed to process natural gas at sea, close to the field location, so companies can liquefy and export gas without waiting for long onshore pipelines and processing plants.
“Rone pitched the project as a strategic solution to that challenge. He said Nigeria has “a lot of gas resources that are stranded offshore,” while FLNG offers a proven way to process gas where it is produced, export volumes meant for international buyers and channel some products back into the domestic market.
One of the most tangible local benefits UTM Offshore talks about is liquefied petroleum gas supply. Rone said over 300,000 tons of LPG would be brought back into Nigeria to support the domestic market. This could cut the country’s dependence on imported LPG, while expanding access to cleaner cooking fuel for households.
As Nigeria seeks to expand the use of gas under its wider energy transition strategy, the domestic angle is becoming more important. LPG is considered a cleaner alternative to traditional biomass fuels commonly used in homes, and wider penetration could help cut indoor air pollution and deforestation.
Rone said the project could therefore bring industrial and social benefits. The development would enhance LPG availability, he said, supporting adoption of cleaner cooking and helping to transition households, especially women in rural and underserved communities, away from more polluting and less efficient energy sources.
UTM Offshore also framed the project as an environmental play, particularly on the issue of gas flaring. Rone said some of the gas planned for the project is currently being flared, meaning the FLNG facility would capture gas that would otherwise be wasted and process it into LNG and LPG.
“Automatically you’re saving the environment,” he said.
Gas flaring has been a long-standing issue in Nigeria’s oil and gas industry, attracting scrutiny from regulators, communities and climate-focused investors. The conversion of flare gas and rejected gas into commercial products could enhance project economics while responding to pressure on producers to reduce emissions and improve environmental performance.
Rone said the company has done a lot of environmental, social and governance work on the project, and has built eco-friendly systems into the floating LNG facility to minimize harm to surrounding communities and marine environments. He said the design is meant to prevent polluting water and degrading the environment within the project’s area of operation.
Besides the first development, UTM Offshore has also expressed wider ambitions to develop a pipeline of FLNG projects in Nigeria. Rone said the company is already eyeing “Project 2 and Project 3,” taking a page from Mozambique’s offshore LNG development path where successive floating LNG projects have followed the first installation.
The strategy is based around offshore stranded gas and fits with a broader push in Nigeria to focus on gas development, he said. The Nigerian National Petroleum Company is a partner in the project with a 20% stake along with other stakeholders, Rone noted and said the latest gas deal should help open the door to the construction phase.
The comments follow a renewed focus on African energy projects by investors seeking diversification of supply in the face of geopolitical disruptions. Rone said recent instability affecting traditional energy routes has heightened international interest in Africa as an alternative source of supply.
“There is a massive flow of investment into the African continent,” he stated, adding that he thought the next 12 months could see a flood of capital as global buyers and investors sought new, dependable export sources.
Speaking specifically about Nigeria, Rone said trusted local partnerships would be essential for international investors. “UTM is a credible local operator that has worked to build its reputation and attract global capital,” he said, adding that Nigeria is becoming more aligned with international business standards.
His message was that the country is more open for business, with greater investor confidence and fewer concerns that once put off foreign participation. Whether that optimism translates into project execution will likely depend on whether UTM Offshore hits its September FID target and locks in the commercial and engineering agreements needed to kick off construction in early 2026.
If so, the project would be a milestone for Nigeria’s gas industry: the launch of its first floating LNG development and a potentially important test case for how the country can commercialize offshore gas, reduce flaring and deepen its position in global energy markets.
