Nigerian and German companies inked two pivotal agreements in Berlin on Tuesday. The first, a $500 million renewable energy pact, was sealed through a memorandum of understanding (MoU) between Union Bank of Nigeria and Germany's DWS Group. The collaboration aims to attract $500 million in investments for renewable energy projects in Nigeria, with a particular focus on rural communities, as stated by presidential spokesperson Ajuri Ngelale.
Simultaneously, a second MoU was signed between Riverside LNG of Nigeria and Germany's Johannes Schuetze Energy Import AG, solidifying a gas export partnership. According to the terms, Nigeria is set to supply 850,000 tons of natural gas annually to Germany, with projections indicating an increase to 1.2 million tons. The initial shipments are slated for 2026, Ngelale reported. Crucially, this agreement will facilitate the processing of approximately 50 million cubic feet per day of natural gas that would otherwise be flared.
Nigeria, boasting Africa's largest gas reserves exceeding 200 trillion cubic feet, faces a challenge of flaring about 300 million cubic feet daily due to insufficient processing facilities. President Bola Tinubu, attending the G20 Compact with Africa conference in Berlin, expressed his welcome to these groundbreaking deals, signaling a positive trajectory for economic collaboration.
This development follows German Chancellor Olaf Scholz's announcement on Monday, declaring a 4 billion euro investment in green energy projects in Africa until 2030. The move aligns with Germany's commitment to achieving carbon neutrality by 2045 and highlights the importance of importing green hydrogen, including from Africa, to meet these ambitious targets.
The agreements signify a pivotal moment in economic ties between Nigeria and Germany, occurring within the context of the G20 Compact with Africa summit. The summit aims to catalyze investment in the rapidly growing African continent by aligning the development agendas of reform-minded nations and identifying lucrative business opportunities.
Under the leadership of President Tinubu, Nigeria has embarked on bold reforms, such as the removal of a popular petrol subsidy and the lifting of restrictions on foreign exchange trading. These measures aim to enhance Nigeria's appeal to investors and stimulate economic revival, addressing challenges like sluggish growth, record debt, double-digit inflation, and the theft of crude oil, the country's primary export.
