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For the gas sector in Nigeria the Central Bank of Nigeria has finally set N10 billion as the maximum loan an obligor can access under its N250bn intervention fund.
In the new guide line tilted ‘Framework for the implementation of an intervention facility for the national gas expansion programme’ the apex bank disclosed this.
READ: World bank was accused for toying with Nigeria over loan.
Concerning the loan some terms and conditions for manufacturers, processors, wholesale distributors, was that the term loan, “Shall be determined based on the activity and shall not exceed N10 billion per obligor, and the for each obligor working capital is maximum of N500m.”
It was disclosed that “The low level of investment in the industry had resulted in the minimal production and utilisation of Compressed Natural Gas and Liquefied Petroleum Gas as clean alternative sources of domestic energy in Nigeria” .
It was further said that “Failure to harness its gas resources has had negative consequences for the country, environmental, economic, fiscal and social, particularly as the industry has the potential to engender rapid growth in Nigeria’s non-oil economy.”
READ: Banks’ loans to private sector increase by N3.50 trillion in one year – CBN
It added that the objectives of the facility included to stimulate investments in the development of infrastructure to optimise the domestic gas resources for economic development and also to improve access to finance for private sector investments in the domestic gas value chain.
The CBN said it also aimed to fast-track the adoption of CNG as the fuel of choice for power generation and transportation. Also LPG as the fuel of choice for domestic cooking, transportation and captive power.
The development would also hasten the development of gas-based industries especially petrochemical (fertilizer, methanol, etc) to support large industries, such as agriculture, textile, and related industries. This will also give leverage to additional private sector investments in the domestic gas market; and provide employment opportunity across the country.
