German engineering giant Siemens has revived its long-stalled $2.3 billion power agreement with Nigeria, marking a renewed push to modernise the country’s electricity infrastructure and expand grid capacity under President Bola Tinubu’s administration.
The deal, originally initiated under former President Muhammadu Buhari as part of the Presidential Power Initiative (PPI), aims to overhaul Nigeria’s transmission and distribution systems. However, it remained largely dormant until recently.
Speaking at the Sub-Saharan Africa International Petroleum Exhibition and Conference (SAIPEC) in Lagos, Germany’s Deputy Head of Mission in Nigeria, Johannes Lehne, confirmed that the partnership regained momentum after Tinubu took office.
According to Business Insider Africa, Lehne described the project’s earlier inactivity as surprising, noting that the current administration has now moved to reactivate and accelerate its implementation.
The Siemens plan sets ambitious phased targets to increase Nigeria’s electricity capacity from its current average of roughly 4,000 megawatts (MW) to 7,000 MW, then 11,000 MW, and ultimately 25,000 MW. A pilot phase has already seen the importation of 10 mobile substations and 10 transformers, expected to add about 1,300 MW to transmission capacity once fully operational.
In 2023, Nigeria’s Minister of Power, Bayo Adelabu, announced a comprehensive review of the agreement, citing changes in economic and regulatory conditions since its original signing in 2018. Delays were attributed to the COVID-19 pandemic, political transitions, and sector-wide reforms.
Beyond electricity infrastructure, Germany and Nigeria are also deepening cooperation in renewable energy and gas development. Lehne emphasized Germany’s experience in diversifying energy sources, particularly following the Russia-Ukraine crisis, which prompted Berlin to rapidly expand liquefied natural gas (LNG) infrastructure. Germany has signaled openness to sourcing gas from Nigeria as part of its long-term energy security strategy.
Nigeria holds Africa’s largest proven gas reserves, estimated at 210.54 trillion cubic feet (TCF), with potential resources reaching 650 TCF. However, production remains at approximately 7.5 billion cubic feet per day, far below global leaders. Industry officials say the key challenge lies in converting vast reserves into sustained economic output.
While the revival of the Siemens initiative signals fresh optimism for Nigeria’s power sector, analysts stress that consistent policy implementation, financing stability, and efficient execution will be essential to achieving the project’s long-term capacity targets.
