Investors Seek Tinubu’s Intervention Over Halted Ogun–Oyo Gas Pipeline Project
Foreign and local investors in Nigeria’s oil and gas sector are seeking urgent intervention from the Presidency following the disruption of the 80-kilometre gas pipeline project linking Sagamu in Ogun State to Ibadan in Oyo State.
The pipeline, being constructed by NIPCO Gas Limited in partnership with NNPC Gas Marketing Limited (NGML), is part of ongoing efforts to expand gas infrastructure and support industrial growth in the South-west.
Industry stakeholders say the project, valued at over $100 million, has been stalled for about three months after the Oyo State Ministry of Lands, Housing and Urban Development reportedly issued stop-work notices along the pipeline route.
The project was expected to be completed in June 2026.
The gas pipeline forms part of broader reforms under the Petroleum Industry Act (PIA) and aligns with President Bola Tinubu’s agenda to promote the use of natural gas for power generation, manufacturing and economic development.
In September 2024, NIPCO Gas Limited was awarded four Gas Distribution Licences by the Nigerian Midstream and Downstream Petroleum Regulatory Authority for a 25-year period. The licences covered the Ibadan axis, Lekki Free Trade Zone, Kara-Sagamu-Abeokuta-Ibadan corridor and Benin City.
Under the PIA, the licences grant exclusivity rights aimed at attracting investment, preventing duplication of infrastructure and improving efficiency in gas distribution.
NGML currently operates more than 500 kilometres of gas pipelines nationwide, while NIPCO Gas has built one of the country’s largest indigenous gas distribution networks across 22 states and the Federal Capital Territory.
The companies have also expanded compressed natural gas infrastructure nationwide through partnerships with the Presidential CNG Initiative and NNPC Limited.
However, investors monitoring the Sagamu-Ibadan pipeline dispute described the situation as a major test of the Federal Government’s gas reform agenda.
According to sources familiar with the matter, NIPCO Gas made several attempts to resolve the dispute, including submitting applications to the Oyo State Ministry of Energy as directed by the state government.
Despite these efforts, work on the project reportedly remains suspended.
The development has also triggered speculation within the oil and gas sector, with claims that competing interests linked to another gas distribution arrangement in Oyo State may be influencing the delay.
Although no official confirmation has been made, industry sources alleged that some stakeholders were pushing for the inclusion of another operator in the Ibadan gas distribution network despite the exclusivity clause contained in NIPCO’s licence under the PIA.
Sources also claimed that representatives of NIPCO Gas, NGML, Shell Nigeria Gas and officials of the Oyo State Government had held meetings over the dispute, during which the legal provisions of the Petroleum Industry Act were discussed.
Industry stakeholders argued that the exclusivity granted under the PIA was designed to protect investors and ensure confidence in Nigeria’s energy sector.
They warned that allowing regulatory uncertainty or political interference could discourage future investments in gas infrastructure projects.
Some operators also expressed concern over the silence of the Nigerian Midstream and Downstream Petroleum Regulatory Authority, which issued the licence to NIPCO Gas.
According to them, the regulator’s failure to publicly clarify its position has further deepened concerns about possible political interference in regulatory matters.
Stakeholders stressed that gas remains central to Nigeria’s industrialisation drive and energy transition plans, especially as businesses seek alternatives to expensive diesel and unstable electricity supply.
They described the Sagamu-Ibadan pipeline as a strategic project capable of boosting industrial activities in the South-west and improving energy access for manufacturers and businesses.
Some industry operators, who spoke anonymously, linked the dispute to wider political tensions between the Oyo State Government and the Federal Government.
They warned against politicising critical infrastructure projects, insisting that investor confidence depends on respect for the rule of law and regulatory certainty.
“No company is above the law, but the law must also protect legitimate investments,” one stakeholder said. “President Tinubu needs to intervene urgently because this dispute is beginning to affect confidence in Nigeria’s oil and gas sector.”
