The Nigerian National Petroleum Company Limited (NNPC) and its partner, TotalEnergies, have agreed to invest $550 million for the development of a gas processing facility in southern Rivers State to boost exports and domestic supplies of gas.

An official at NNPC who is privy to the agreement disclosed this to Reuters yesterday, saying the investment would include a gas processing plant and a pipeline.

TotalEnergies declined to comment while the NNPC source said an announcement would be made this week, according to the international news agency.

The gas processing facility would be built on the Ubeta onshore gas field, jointly owned by TotalEnergies and NNPC and would supply gas to the Nigeria Liquefied Natural Gas (NLNG) plant, the report stated.

The NLNG is a consortium between NNPC, Shell, TotalEnergies and Italy's Eni (ENI).

When completed, the plant would generate 350 million standard cubic feet per day of gas (mmscf/d) and 10,000 barrels per day of associated liquids, the source stated.

Nigeria, which holds Africa's largest natural gas reserves of over 209 trillion cubic feet (tcf) flares - or burns off gas from its oil fields because it lacks processing infrastructure and faces capital constraints.

The latest investment could mean President Bola Tinubu's bid to attract investment into Nigeria's energy sector is beginning to succeed, analysts said.

"The government will hope this offers confidence not only in the quality of the Nigerian resource base, but also in the government's pledge to improve ease of doing business," Reuters quoted the Director, sub-Saharan Africa at Political Risk Consultancy Horizon Engage, Clementine Wallop, to have said.

Energy analysts hold the view that Nigeria has failed to increase its exports to the European Union after the bloc sought alternative supplies to make up for lost Russian imports because of the Ukraine War.

Locally, Nigeria is struggling to feed its gas power plants that generate most of its grid electricity, the report added.