The company said the proposed investment would increase production capacity and support the development of higher-value products from Nigeria’s abundant oil and gas resources, while reducing the country’s dependence on imports and creating opportunities for exports across Africa.
Managing Director of IEPL, Manish Mundra, disclosed the plan in Port Harcourt while delivering a keynote address at the seventh Mid/Downstream Oil and Gas Conference.
The conference was organised by the Centre for Gas, Refining and Petrochemical Engineering (CGRP), University of Port Harcourt, in conjunction with the Nigerian Society of Chemical Engineers.
Mundra’s address was delivered on his behalf by the Head of Fertiliser Manufacture at Indorama Eleme Fertiliser and Chemicals Limited, Upendra Singh.
He said Nigeria possesses one of Africa’s largest natural gas reserves as well as the continent’s second-largest oil reserves, providing the country with a substantial resource base to develop a globally competitive downstream industrial sector.
However, he noted that despite the rapid expansion of Nigeria’s refining capacity, the country continues to import significant volumes of plastics, fertilisers, specialty chemicals and other downstream products.
According to him, the next stage of Nigeria’s oil and gas development should focus on converting the country’s hydrocarbon resources into diversified, high-value industrial products rather than primarily exporting raw materials.
Mundra said the sector would need to overcome a weak downstream industrial base, an innovation gap and growing sustainability demands if Nigeria is to fully benefit from its oil and gas resources.
From gas reserves to industrial products
Mundra said Nigeria’s enormous gas reserves provide an opportunity to develop integrated industrial complexes capable of producing petrochemicals, fertilisers and other products for both domestic and international markets.
“Nigeria again has the resource, large resource base for oil and gas, which is exported as Liquefied Natural Gas or converted into polymers, fertilisers, and downstream products. The past five years have changed the arithmetic of the choice.
“For this, we need to have the policy reform, like PIA 2021 and subsidy deregulation, which are resetting the investment signals across the value chain as new downstream landscape, large-scale refining and petrochemical capacities are coming up, pushing Nigeria from import dependence toward the next export state status,” he said.
He argued that the combination of policy reforms and new investments in refining and petrochemicals could fundamentally change Nigeria’s position in the African energy and industrial market.
The development of large-scale refining capacity, he said, should be matched by investments in petrochemicals and other downstream industries capable of converting refined products and gas into materials required by manufacturing, construction, agriculture and consumer industries.
Mundra also pointed to rising demand across Africa as an opportunity for Nigeria to establish itself as a major supplier of petrochemical and fertiliser products.
Increasing population, agricultural activity, construction and packaging requirements, he said, are driving sustained demand for polymers and fertilisers across the continent.
“We need to capitalise on the Middle East crisis and solve logistic challenges to make Africa more attractive for the West.
“We have the highest massive gas stock in Africa, more than 206 TCF, which can be converted into orifins: polyolifins, ammonia, urea, and intermediate integrated—integrated complexes. It can further be converted into resins and packaging pipes, textiles, for domestic consumption or exported to West and Central Africa,” he added.
Push for deeper value addition
The proposed $3 billion investment comes amid growing efforts to increase value addition within Nigeria’s oil and gas industry.
For decades, Nigeria has relied heavily on the export of crude oil while importing many refined petroleum products, petrochemicals, plastics and fertiliser-related materials needed by domestic industries.
The expansion of refining and petrochemical capacity is expected to gradually alter that structure by allowing more of the country’s hydrocarbons to be processed locally into products with higher economic value.
For Indorama, the strategy involves expanding beyond the production of basic petrochemical and fertiliser products to create an integrated industrial value chain.
Such a development could supply raw materials to manufacturers while opening up new export markets in West and Central Africa.
Mundra therefore called on the government and other stakeholders to address the structural challenges limiting the growth of Nigeria’s downstream sector.
He identified the thin downstream industrial base, limited innovation and sustainability concerns as issues that must be tackled to unlock the full economic potential of the sector.
Industry seeks stronger policy support
The conference also focused on the need for greater value addition to Nigeria’s oil and gas resources.
In his welcome address, Anthony Ogbuigwe, Chairman of the Governing Board of the Centre for Gas, Refining and Petrochemical Engineering, said the event was designed to draw the attention of policymakers to the opportunities available in the downstream sector.
He said Nigeria could create substantially more wealth by using the by-products of oil and gas production as feedstock for industries rather than relying predominantly on the export of raw hydrocarbons.
The push for increased domestic processing is particularly significant as Nigeria seeks to reduce import dependence, strengthen manufacturing and create jobs from its natural resource base.
With its planned $3 billion investment, Indorama is seeking to position its Eleme operations at the centre of this transition, with an ambition to build an integrated petrochemical and fertiliser hub capable of serving Nigeria and the wider African market.
If successfully implemented over the next five years, the expansion could significantly increase Nigeria’s capacity to convert its gas and hydrocarbon resources into fertilisers, polymers, resins and other industrial inputs, strengthening the country’s position as an emerging downstream manufacturing and export centre.