Region
Nigeria

Sector
Energy

Summary:

Nigeria has major coal resources that have not been well explored or exploited. The government has prioritised the use of these resources in order to deal with the country's power supply problems.

Contact
TradeInvestNigeria

Email
infonigeria@gan.co.za

Nigeria has major coal resources that have not been well explored or exploited. The government has prioritised the use of these resources in order to fix the country's power supply. The current electrical power generating and grid distribution capability is in the range of 3 500 to 4 500 megawatts - far short of that required to keep the economy growing. Power is produced from several small gas-fired and hydropower generating facilities. Real demand is estimated to be in the range of 20 000 to 25 000 MW, and many people supplement power with costly diesel-powered generators.

Investment opportunities

The federal government is inviting foreign companies to exploit the large coal resources and construct coal-fired generating plants, which will connect to the nation’s electricity distribution grid. Nigerian coal has been found suitable for boiler fuel, production of high calorific gas, domestic heating, briquettes, formed coke and the manufacture of a wide range of chemicals including waxes, resins, adhesives and dyes. Their characteristic properties (low sulphur and ash content and low thermoplastic properties) make them  ideal for coal-fired electric power plants.
 
There is also significant demand for coal briquettes to replace wood for domestic and industrial use. This will also stop the deforestation.

Opportunities for interested investors also lie in further exploration of known reserves for power generation. This will develop the confidence that is required by potential investors to support investments in major mines and generating facilities.

Potential market

The domestic coal market is latently large. Besides the potential for power generation, Nigeria currently imports coals of various grades and qualities including coke, pellets, briquettes, anthracite, coking coal and form coke. There is also the potential for coal exports to countries such as China, Israel, Japan, Ghana, United States, Europe and India.

For further information on this opportunity contact TradeInvestNigeria at infonigeria@gan.co.za