Nigeria has entered into a gas supply agreement with several joint venture (JV) partners to support a proposed $3.5bn (N5.72trn) fertiliser and petrochemical plant in Brass Island, Bayelsa State, reported Reuters, citing sources.

The deal, which involves the delivery of an estimated 270 million standard cubic feet per day of gas, is set to impact the country's gas monetisation efforts and reduce reliance on fertiliser imports.

Nigeria’s JV partners include industry giants Shell, TotalEnergies and Eni.

Nigeria’s Ministry of Petroleum Resources Permanent Secretary Nicholas Agbo Ella stated that the gas sale and purchase deal is estimated to generate at least $1.5bn of petrochemicals and other gas-based products per year.

"In addition to boosting exports, the project will reduce fertiliser imports by 30%, saving Nigeria approximately $200min foreign exchange annually," Ella said.

"This agreement represents a significant milestone in our ongoing efforts to monetise Nigeria's vast gas reserves," he added.

The methanol project will be operated by Brass Fertilizer & Petrochemical Company (BFPCL).

In a separate development, ExxonMobil has announced plans for a $10bn investment in offshore oil operations in Nigeria, including a focus on the Owo project, a significant deep-water initiative.

The company aims to invest around $2.5bn annually to enhance oil production by 50,000 barrels per day (bpd) over the next few years.

However, Nigeria has faced challenges in its oil sector, with reports indicating a loss of 362 million barrels (bbl) of crude oil between 2014 and 2023 due to measurement errors, sabotage and production adjustments.

The Nigeria Extractive Industries Transparency Initiative, which promotes transparency and accountability in revenue management, reported that the country's daily crude oil losses amounted to approximately 992,000bbl.

The country aims to boost supplies to industries and power plants, increase exports and end routine flaring by 2030.