With the announced Decade of Gas, many actors look to tap into the opportunity to build storage facilities.

Tom ODUOL Managing Director NAVGAS

Increased competitiveness in the midstream sector

April 3, 2023

Tom Oduol, managing director of Navgas, talks to The Energy Year about the competitiveness of the midstream sector and the actions taken by the government to increase the penetration of gas in the market. Navgas provides LPG to gas-to-power projects in Nigeria/West Africa.

How do you assess the competitiveness of the midstream sector?
Ever since we began our operations, we have witnessed an increase in the number of players within the storage market. With the announced Decade of Gas, many actors look to tap into the opportunity to build such facilities. On our side, we are focused on staying competitive and working on our strengths.
What we see is that the time required for new storage infrastructure to be built is lower than the growth dynamic of the downstream side. Thus, any decision regarding expansion on our side will depend on demand, which has been unstable over the last two years.

Which actions are taken by the government to increase the penetration of gas in the market?
We see the government introducing regulations which positively affect the supply chain and push for wider and increased consumption of gas in the market. Efforts are made on the logistics side, on awareness and on improving last-mile supply. There are also considerable efforts regarding incentives and bringing down the cost of gas.
Per capita consumption of LPG in Nigeria is still low, and much needs to be done, but we believe that with gas getting more affordable, we should see the market grow. As an example, for now, we are currently operating at around 60% of our installed capacity.


Could you give an overview of your activities?
We operate in the clean energy sector, focusing on midstream activities as we provide bulk storage of LPG services. We have been doing so since our inception as a JV between VTTI [Vitol Tank Terminals International] and Nigeria Industrial and Domestic Gas Company (NIDOGAS) back in 2010. We provide solutions by striking the necessary balance between the supply side and the logistics side of the business.
We receive the products via vessel, which we then store in our storage tanks and discharge to our customers’ trucks.
Our main client is Algasco LPG Services, who supplies the product to the rest of the market. We mainly serve the Lagos market for now. On the supplier side, we work with NLNG, and we also receive imported cargoes. We now have three storage tanks for LPG gas and propane which have an added capacity of 11,000 tonnes. We were the first to build this storage capacity in Nigeria and to foresee the key upcoming role of gas in the market.
In terms of volume, we handle around 200 kilotonnes annually and project to move towards 250 kilotonnes.

What is the value proposition of Navgas?
A major priority at Navgas is safety. Our position as a gas storage company and our ambitions to aid in its penetration put responsibilities on us, as we want to be at the forefront of safety standards. We want authorities and people to see LPG as a viable and safe alternative. Not only do we operate to such standards in our terminal, but we also participate in initiatives to educate different stakeholders, such as truckers and all other personnel, about these practices.
We operate within international standards when it comes to security and safety for jetties and terminals. We make sure to have the various inspections and audits to certify us across all our activities.
We are the first semi-automated terminal in Nigeria. We have a control room, and most of our operations are controlled remotely. We also have the only technology-based truck monitoring system in the country, through which we store and analyse data.

What is your outlook for the future of Navgas?
LPG fits right into the model which the global governance system is aiming for regarding a transition towards more sustainable energies. With excellent production capacities in Nigeria, we have positioned ourselves to be able to scale and take on further opportunities to meet the demand for LPG. We are pioneers in propane storage and are licenced as we anticipate the need to grow in the future. We want to engage with more players, as we are a forward-looking company. In the next five years, we want to play a key part in the supply chain and contribute to the growth of demand. We are positioned to seize opportunities and have the capacity to deliver. Our good reputation and standards make us partners of choice. We are continuing to monitor and look for any growth opportunities in gas-to-power and autogas projects.

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