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Deal to expand gas access, tackle flaring, deepen Nigeria’s energy transition
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A consortium of Ardova Plc and Diadem Energy has unveiled plans to establish 100 compressed natural gas (CNG) refuelling stations across Nigeria within 24 months, following its proposed acquisition of Powergas, one of Africa’s largest CNG producers and virtual pipeline distributors.
The ambitious expansion plan, which forms part of the consortium’s strategy to integrate gas production, transportation and distribution, is expected to widen access to cheaper domestic gas for motorists, commercial fleets and industries while creating new opportunities for Nigeria’s gas sector.
The acquisition will see the consortium take over 100 per cent of Powergas Global Investments Nigeria Limited and Powergas Ebedei Limited from Africa Infrastructure Fund I, managed by A.P. Moller Capital, through Impala Energy Holdings. Completion is expected by the end of 2026, subject to regulatory and other approvals.
The deal brings together Powergas’ gas compression infrastructure and supply relationships, Diadem’s road-based gas transportation network and Ardova’s nationwide retail and distribution footprint in a combination the investors say could accelerate the commercialisation of Nigeria’s abundant gas resources.
Speaking at a town hall meeting with Powergas employees in Lagos, Diadem Group Chairman, George Eluwa, said the acquisition would build on an existing partnership that had demonstrated the commercial viability of transporting gas to customers beyond the reach of conventional pipelines.
Eluwa disclosed that Diadem’s CNG truck fleet completed more than 6,500 trips, covered over 2.7 million kilometres and delivered more than 51 million standard cubic metres of gas in 2025 alone.
He said the operations also helped avoid more than 500 tonnes of carbon dioxide emissions compared with diesel-based transportation.
According to him, the figures reflected the combined efforts of Powergas’ compression and operations teams and Diadem’s logistics network.
“Having worked closely with Powergas as its virtual-pipeline logistics partner, we have seen first-hand the transformative potential of taking natural gas beyond the conventional pipeline network,” Eluwa said.
“This consortium brings together every link in the gas value chain: Powergas compresses it, Diadem moves it, and Ardova brings it within reach of customers across Nigeria.”
He said the partnership would create opportunities to deliver cleaner and more affordable energy to industries, transport operators and communities, in line with the Federal Government’s Presidential Initiative on Compressed Natural Gas and Electric Vehicles and the Decade of Gas programme.
The proposed acquisition comes amid Nigeria’s efforts to expand domestic gas utilisation and reduce reliance on petrol and diesel, particularly in the transportation sector, where fuel costs have placed considerable pressure on households and businesses.
For Ardova, the transaction represents an expansion beyond its established petroleum products and liquefied petroleum gas businesses into a more extensive natural gas infrastructure market.
Its Executive Chairman, AbdulWasiu Sowami, said the company was looking beyond Powergas’ existing assets to the opportunity to establish a national gas distribution platform.
“What drew us to Powergas was not only its assets, it was its people and the reputation you have built,” Sowami told employees at the town hall.
He said the consortium intended to connect Nigeria’s gas resources to industry, power generation and transportation while supporting the Federal Government’s CNG and broader gas development initiatives.
Sowami added that Ardova’s distribution network, combined with Powergas’ compression infrastructure and Diadem’s transportation capabilities, would provide the foundation for expanding gas access across the country.
The proposed deployment of 100 CNG refuelling stations within 24 months is a major component of the plan. If delivered, it would extend CNG availability through Ardova’s retail network, providing additional refuelling options for motorists and commercial transport operators.
However, the expansion will require significant investment in compression facilities, gas transportation, refuelling infrastructure and reliable supply to ensure that the proposed stations can operate sustainably.
Managing Director of Ardova Plc, Abiola Babatunde-Ojo, said the immediate priority following the transaction would be to translate the consortium’s plans into operational capacity.
“This combination gives us the infrastructure, reach and capabilities to turn the opportunity in gas into something tangible for customers across Nigeria,” she said.
“Our focus now is execution: expanding compression capacity, bringing CNG into our retail network and connecting more industries and fleets to a reliable domestic energy source.”
Beyond transportation, the acquisition is expected to expand the commercial use of gas from Nigeria’s producing corridors, particularly through investments in additional compression capacity.
The consortium plans to expand Powergas’ facilities across viable gas-producing corridors, creating additional demand for associated and non-associated gas and supporting efforts to reduce routine gas flaring.
The strategy could also provide upstream producers with additional commercial outlets for gas that might otherwise remain stranded or be flared, while creating opportunities for investment across the gas value chain.
Powergas, founded in 2013 by the Clean Energy Group, pioneered the transportation of compressed natural gas to industrial and power customers beyond the conventional pipeline network. Its operations include four mother stations and more than 250 tube skids.
Its Ebedei flare gas monetisation project, developed with investment from A.P. Moller Capital, converts gas that would otherwise be flared into energy for commercial and industrial customers.
A.P. Moller Capital invested in Powergas Ebedei through Impala in 2019, supporting the company’s development, construction, commissioning and subsequent expansion. The facility commenced operations in 2020 and was commissioned in 2021.
Powergas has since expanded its distribution network across the South-East, South-South and South-West, building a customer base among industrial and commercial gas users.
Vice-Chairman of Powergas, Pulak Sen, said the acquisition would provide the company with an opportunity to expand its operations into new markets and geographies.
He said Ardova’s national reach and Powergas’ compression infrastructure offered a platform for expanding the country’s auto-gas market.
The consortium also plans to explore opportunities to extend Ardova’s gas infrastructure platform into the wider West African market, although no specific countries or implementation timelines were disclosed.
For employees, however, the immediate concern remains the continuity of operations during the ownership transition.
Eluwa assured staff that the company would continue operating under existing arrangements until the transaction was completed, stressing that regulatory approvals and other closing requirements were still outstanding.
He also underscored the importance of maintaining safety standards as the company prepares to expand its operations.
“Gas is our business and safety is our licence to operate,” he said, urging employees to maintain the standards that have sustained the company’s operations.
A.P. Moller Capital’s Managing Partner and Chief Executive Officer, Kim Fejfer, said the transaction reflected the firm’s investment approach of combining capital with operational expertise to develop essential infrastructure.
He said the development of Powergas demonstrated how investments in infrastructure could improve access to reliable energy for industrial and commercial customers while creating long-term value.
