Market News

BY Abubakar Ibrahim 

Nigeria, Africa’s largest exporter of liquefied natural gas (LNG), is deepening its foothold in the Caribbean energy market, with Jamaica emerging as a promising new trading partner for LNG, BusinessDay’s analysis has shown.

Jamaica recorded higher LNG imports in 2024, driven primarily by Nigeria and Mexico, the Gas Exporting Countries Forum (GECF) stated. However, the Forum did not make the figures known.

Data from the International Trade Centre’s Trade Map platform revealed a notable uptick in Nigeria’s LNG exports to Jamaica, signalling a budding energy relationship between Africa’s top gas producer and the island nation.

“Jamaica’s LNG imports were up significantly year-on-year and may be attributed to higher gas demand in the electricity sector,” a senior industry player said.

Nigeria exported LNG worth $160.6 million to Jamaica in 2023, making it the second-largest supplier of LNG to the Caribbean country after the US, marking a record high since Nigeria entered the Jamaican market nine years ago.

Further analysis showed that Nigeria holds 39.53 percent market share of the Jamaican LNG import market in the period, a development that further increased in 2024, according to the GECF.

Read also: FG, Arete sign pact to float $27.3mn LNG project in Nigeria

Nigeria’s LNG export

Nigeria, Africa’s top LNG exporter, has raked in over $40 billion in the last eight years, spreading the country’s market share across the globe, according to data gleaned from Trade Map.

Despite the rife in the Jamaican LNG market, Nigeria recorded a decline in exportation on the back of a force majeure on the Bonny LNG facility that has led to the unavailability of feed gas for LNG exports.

“The fall in Nigeria’s LNG exports was due to lower feed gas availability for LNG exports. The force majeure on the Bonny LNG facility declared in October 2022, following widespread flooding, has remained in place,” the GECF stated.

Jamaica’s natural gas consumption

Jamaica’s natural gas consumption has been relatively modest compared to global standards, driven by the need to improve electricity distribution and coverage.

As of recent data, the country consumes approximately 6,961 million cubic feet (MMcf) of natural gas annually, ranking 114th in the world for natural gas consumption. This accounts for about 0.005 percent of the world’s total natural gas consumption.

According to Worldometers, the Caribbean country does not produce natural gas domestically and relies entirely on imports to meet its demand.

“The country’s natural gas usage is primarily focused on electricity generation and industrial applications as part of its broader energy diversification strategy.”

Jamaica gas-to-electricity growth

Jamaica has been making strides in its gas-to-electricity transition, with natural gas becoming an increasingly vital part of the country’s energy mix. This shift is largely driven by investments in liquefied natural gas (LNG) infrastructure and power generation facilities.

In the last ten years, the Caribbean country has invested in LNG infrastructure expansion, power generation and has been involved in major acquisition deals to drive the growth among others.

Major Investments

LNG Infrastructure Expansion: Jamaica has established LNG import terminals in Montego Bay and Old Harbour, which are critical for supplying natural gas to power plants.

Power Generation: The country has integrated natural gas into its electricity generation, reducing reliance on oil-based fuels. This transition has improved energy reliability and lowered costs.

Recent Acquisitions: Excelerate Energy recently acquired Jamaica’s downstream LNG and power infrastructure from New Fortress Energy for over $1 billion. This move is expected to enhance the efficiency and growth of Jamaica’s gas-to-electricity sector.