1. Introduction, Literature Review, and Theoretical
Framework
Natural gas represents a pivotal component of Nigeria’s energy future, positioned at the intersection of domestic energy security, industrialisation, and environmental sustainability. Despite holding Africa’s largest natural gas reserves, Nigeria continues to experience erratic utilisation patterns, underdeveloped distribution networks, and persistent gas flaring. Existing studies highlight the mismatch between Nigeria’s gas supply and end-user demand due to infrastructural deficits, market distortions, and regulatory delays [1] [2]. In Algeria, substantial government-led infrastructure investments have accelerated the domestic penetration of gas. The UK illustrates a well-regulated gas-to-power system integrated with industrial policies.
The study adopts the Energy Ladder Model to understand transitions from traditional biomass to cleaner fuels. The Resource Curse Hypothesis also frames the paradox of resource-rich nations experiencing low developmental outcomes due to institutional weaknesses [3] [4].
Chapter two deals with literature review and the theoretical framework of the study, which examines the existence of natural gas. It highlights natural gas utilisation, what natural gas is, the formation of natural gas, natural gas underground, and the Nigerian gas sector’s linkages and socio-economic development in Nigeria. It also examines the production of natural gas in Nigeria, the development of the gas sector in Nigeria, the Impact of gas on Nigeria’s economy, the challenges facing the gas sector and the demand management of natural gas in Nigeria. Chapter three discusses the research methodology, which includes the research population, sampling techniques, data collection methods, and data analysis using sample percentages and the chi-square test. Chapter four presents and analyses the questionnaire distributed to various sectors concerning the study and analyses the results using statistical tools such as percentages, chi-square and bar charts. Chapter Five concludes with success stories in the Nigerian gas sector and provides recommendations based on the findings presented in Chapters Two to Four.
This study aims to assess demand-side challenges and propose practical strategies for efficient gas utilisation in the country. This research employed a structured questionnaire distributed to 120 stakeholders across the energy value chain. The data was analysed using descriptive statistics and chi-square tests to assess the natural gas demand management in Nigeria. It was observed from the analysis of the results using the chi-square test that to bridge the demand-supply gap in natural gas, Nigeria must strengthen its gas infrastructure networks, promote private sector participation through fiscal incentives, institutionalise gas utilisation education through schools and media, and regularly review gas policy frameworks to reflect market realities. These actions will ensure optimal harnessing of Nigeria’s vast gas potential, driving sustainable development and economic growth [5].
2. Methodology
The research design employed is a survey, in which participants from the oil and gas industry and others from various backgrounds were randomly selected as a sample to conduct the investigation. The study aims to employ the survey research method to investigate Natural Gas Demand Management in Nigeria. The design of this research work is dual. The survey was conducted by applying two research instruments:
I. The theoretical approach
II. The field work approach
From the theoretical approach, the researcher was able to gather facts from textbooks, professional journals, magazines and articles. This approach becomes the source of secondary data. The account here will be analytical in its detailed and critical examination as well as appraisal of the significant issues and trends. It is descriptive in its objective consideration of the issues and trends which form the basis of subsequent analysis. It is also prescribed, as it recommends strategies and mechanisms for managing and developing Nigeria’s natural gas distribution and utilisation [6].
It also adopts a multidisciplinary approach, drawing from the principles and values of international gas development management.
While the fieldwork approach helps gather primary data. The research technique used here was the collection of responses to structured questionnaires. Structured questionnaires were used to solicit environmental and socio-economic information from the Nigerian public, as well as to gauge the views of oil companies regarding their operations in Nigeria, particularly their socio-economic responsibilities to the Nigerian public. A random field survey was conducted. A total of 400 questionnaires were administered, and 284 questionnaires were received and analysed. Each item on the questionnaire consisted of five responses categorised into strongly agree (SA), agree (A), undecided (U), disagree (D) and strongly disagree (SD). The justification for this choice is that the approach permits scientific generalisation to be made from the data obtained [7]. Other reasons are:
It permits broad coverage.
It will yield candid and objective data because of impersonality.
It is more economical because it saves time.
Samples were drawn using stratified sampling techniques. The chi-square test was used to compare more than two proportions of observations for a large population with a value greater than 30. Here, we want to determine whether the observed difference in frequencies can be reasonably attributed to chance. This study encompasses various individuals representing different states in Nigeria to determine the effective Natural Gas Demand Management for Nigeria. It includes all categories of people from all walks of life that comprise Nigeria.
Due to time and financial resource constraints, it is not possible to study the entire population, so an accessible population must be chosen that forms the sample for this research. The target study population was drawn from various segments of the Nation, namely Unemployed youths, Community leaders, Local government workers, and oil and gas company workers. The target population for the study is in the Appendix below.
The data generated were analysed using simple percentages and the chi-square test. The use of the chi-square test in this study is to assess the goodness of the association between the different variables (the dependent and independent variables). The assumptions adopted are highlighted below:
Assumptions for hypothesis I
The Respondents in the sample were randomly selected
The sample size was 50
Test statistics = X2 = (Fo – Fe)2/Fe
Research Design
Calculated X2 = 404.2
Critical = 11.070
Degree of freedom df = K – 1. Where K is the number of Categories, here K = 6
Therefore df = K – 1 = 5
Choosing a 5% level of significance gives α = 0.05
Assumptions for hypothesis II
The respondents in the sample were randomly selected.
The sample size was 50
Test statistics = X2 = (Fo – Fe)2/Fe
Research Design
Calculated X2 = 207.8
Critical = 11.070
Degree of freedom df = K – 1. Where K is the number of Categories, here K = 6
Therefore df = K – 1 = 5
Choosing a 5% level of significance gives α = 0.05
Assumptions for hypothesis III
The respondents in the sample were randomly selected.
The sample size was 50
Test statistics = X2 = (Fo – Fe)2/Fe
Research Design
Calculated X2 = 198.3
Critical = 11.070
Degree of freedom df = K – 1. Where K is the number of Categories, here K = 6
Therefore df = K – 1 = 5
Choosing a 5% level of significance gives α = 0.05
Assumptions for hypothesis IV
The respondents in the sample were randomly selected.
The sample size was 50
Test statistics = X2 = (Fo – Fe)2/Fe
Research Design
Calculated X2 = 162.2
Critical value = 11.070
Degree of freedom dF = K – 1, where K is the number of categories; here K = 6
Therefore dF = K – 1 = 5
Choosing a 5% level of significance gives α = 0.05
Assumptions for hypothesis V
The respondents in the sample were randomly selected.
The sample size was 50
Test statistics = X2 = (Fo – Fe)2/Fe
Research Design
Calculated X2 = 134.5
Critical table value = 11.070
Degree of freedom dF = K – 1, where K is the number of categories; here K = 6
Therefore df = K – 1 = 5
Choosing 5% level of significance gives α = 0.05
3. Results and Discussion
Chi-square analysis revealed significant associations between independent variables and dependent variables. The production of gas is the independent variable, and the gas demand management is the dependent variable (p < 0.05) [8]. The hypotheses were derived from research questions.
3.1. Hypotheses I
The impacts of effective development of the Nigerian natural gas utilisation system on the Nigerian economy.
The Null Hypothesis H0: There are no significant impacts of Nigerian natural gas utilisation development on the Nigerian economy.
The Alternative Hypothesis: There are significant impacts of Nigerian natural gas utilisation development on the Nigerian economy.
Research Result
Calculated value > Critical value
Based on the analysis in the Appendix and assumption I above, the data are statistically significant at a 5% level of significance, considering the sampling error. An association exists between the variables, as the calculated value of 404.2 is greater than the critical table value of 11.070, thereby validating the alternative hypothesis (see appendix).
Interpretation
The idea of developing a Nigerian natural gas utilisation system is significant, and the development process, as outlined in the Nigerian Gas Master Plan [9], is of great importance to Nigeria’s dream of 100% % gas utilisation and distribution. To power the domestic economy through the utilisation of natural gas to generate electricity and to power the industrialisation of Nigeria [10].
3.2. Hypotheses II
How did the idea of developing a Nigerian natural gas utilisation system come into being?
The Null Hypothesis H0: There is no significant idea of developing a Nigerian natural gas utilisation system.
The Alternative Hypothesis: There is a significant idea of developing a Nigerian natural gas utilisation system.
Research Result
Calculated value > Critical value
Based on the analysis in the Appendix and Assumption II above, the data are statistically significant at a 5% level of significance. An association exists between the variables, as the calculated value of 207.8 is greater than the critical table value of 11.070, thereby validating the alternative hypothesis [11].
Interpretation
The analysis indicates that the implementation process of developing Nigerian natural gas utilisation will lead to an increase in gas production, generating more revenue for the Nigerian Government.
This will also lead to the creation of more job opportunities for the youth.
The demand for gas will also increase, and a steady power supply of electricity will be maintained.
3.3. Hypothesis III
The Critical Failure Factors of Nigerian Natural Gas Utilisation System Development.
The Null Hypothesis, Ho: There are no significant Critical Failure Factors in the Nigerian natural gas utilisation development.
The Alternative Hypothesis: There are significant critical failure factors in the development of the Nigerian natural gas utilisation system.
Research Result
Calculated value > Critical value
Based on the analysis in the Appendix and Assumption III above, the data are statistically significant at a 5% level of significance. An association exists between the variables, as the calculated value of 198.3 is greater than the critical table value of 11.070, thereby validating the alternative hypothesis [11].
Interpretation
The analysis above, based on the statistical data, indicates that there are significant Critical Failure Factors in the Nigerian natural gas utilisation system development.
The factors are as follows:
1) Government Policy
2) Inflation rate
3) Lack of infrastructural facilities
4) Huge Capital Outlay
3.4. Hypotheses IV
The specialised strategies or mechanisms are often neglected in the management and development of Nigeria’s natural gas utilisation system.
The null hypothesis Ho: There are no significant specialised strategies or mechanisms that were neglected in the management and development of the Nigerian natural gas utilisation system.
The alternate hypothesis Hr: There are significant specialised strategies or mechanisms that were neglected in the management and development of the Nigerian natural gas utilisation system.
Research Result
Calculated value > critical value
Based on the analysis in the Appendix and Assumption IV above, the data are statistically significant at a 5% significance level. An association exists between the variables since the calculated value of 162.2 is greater than the critical table value of 11.070, thereby validating the alternative hypothesis [11].
Interpretation
The statistical data indicate that the development of Nigeria’s natural gas utilisation system has a significant impact on Nigeria’s economy. Presently, Nigeria is referred to as “a gas country with some oil,” boasting proven gas reserves of 187 Tcf. This will undoubtedly expand the government’s revenue base and have a positive impact on the standard of living for the Nigerian people.
3.5. Hypotheses V
What process did the implementation of the Nigerian natural gas utilisation system development go through?
The Null Hypothesis, H0: There is no significant process of implementing Nigerian natural gas utilisation development.
The alternate hypothesis Hr: There is a significant implementation process for Nigerian natural gas utilisation development.
Research Result
Calculated value > Critical value
Based on the analysis in the Appendix and Assumption V above, the data are statistically significant at a 5% level of sampling error. An association exists between the variables since the calculated value of 134.5 is greater than the critical table value of 11.070, thereby validating the alternative hypothesis [11].
Interpretation
The statistical data indicate that significant strategies or mechanisms are being neglected in the management and development of the Nigerian natural gas utilisation system.
These strategies can be explained in the following context.
The production processes of various oil and Gas companies in Nigeria do not consider the biodiversity of the Niger Delta environment during their planning processes.
Nigeria’s challenge is not the availability of gas, but rather the lack of coordinated infrastructure, effective policy enforcement, and stakeholder engagement. Comparative models from Algeria and the UK emphasise integrated policy frameworks, public-private partnerships, and transparency [12].
Policy and Implementation Implications:
1) The Federal Government must prioritise the completion of pipeline infrastructure and encourage local gas distribution firms [13].
2) Regulatory bodies, such as NUPRC [14], should enhance compliance monitoring.
3) Public awareness campaigns should be conducted in regional languages.
4) Conclusion and Recommendations [15].
The research work is designed to determine the demand management of natural gas for Nigeria. To achieve this, five research hypotheses were examined, which led to many findings, which are as follows:
I. The development of the Nigerian natural gas utilisation system is leading to an increase in the demand for natural gas both in the domestic market (Nigeria) and in the international market.
II. The implementation process of Nigeria’s natural gas utilisation system development will lead to effective demand management of natural gas for Nigeria.
III. The critical failure factors of the Nigerian natural gas utilisation system development, if well handled, will increase the production of natural gas to meet the increasing demand.
IV. The impacts of developing Nigerian natural gas utilisation on Nigeria’s economic development are positive, and this will increase the nation’s Gross Domestic Product (GDP).
V. The neglected strategies or mechanisms in the management and development of the Nigerian natural gas utilisation system, if well managed, could lead to an increase in gas production to meet the growing demand.
Appendix: Visual Representation
Table 1. The study target population from the various categories and sample size.
S/N |
Categories |
Study Population |
Sample % |
1 |
Unemployed Youths |
100 |
50 |
2 |
Businessmen/Women |
100 |
50 |
3 |
Community Leaders |
10 |
10 |
4 |
Civil Servants in the Ministry |
100 |
40 |
5 |
Local Government Worker |
100 |
50 |
6 |
SPDC (Oil & Gas Worker) |
100 |
40 |
7 |
WRPC (Oil & Gas Worker) |
100 |
50 |
8 |
NGC (Gas Worker) |
100 |
60 |
9 |
Chevron (Oil & Gas Worker) |
90 |
50 |
|
TOTAL |
800 |
400 |
Table 2. Distribution by factors on the demand management of natural gas.
Factors |
Strongly Agree |
Agree |
Undecided |
Disagree |
Strongly Disagree |
Total |
|
NO |
% |
NO |
% |
NO |
% |
NO |
% |
NO |
% |
|
Nigerian Natural Gas Utilization |
142 |
50 |
94 |
33.10 |
30 |
10.56 |
6 |
2.11 |
12 |
4.23 |
284 |
Process Implementation of Nigeria Natural Gas Utilization |
73 |
25.70 |
94 |
33.10 |
30 |
10.56 |
45 |
15.28 |
42 |
14.79 |
284 |
Failure of Nigerian Natural Gas Utilization |
34 |
11.97 |
100 |
35.21 |
21 |
7.39 |
67 |
23.59 |
62 |
21.83 |
284 |
Impact of Nigerian Natural Gas Utilisation |
78 |
27.46 |
142 |
50 |
30 |
10.56 |
22 |
7.75 |
12 |
4.23 |
284 |
Strategies Neglect in the Management and Utilization of Natural Gas |
68 |
23.94 |
92 |
32.39 |
55 |
19.37 |
34 |
11.97 |
35 |
12.32 |
284 |
Source: Field Work.
Table 3. Summary of significance tests and conclusion on the demand management of natural gas for nigeria.
Factors |
Ranking |
Degree of Freedom |
Level of Significance |
Table Value of 2 |
Calculated 2 |
Conclusion |
Impact of Nigerian Natural Gas
utilization |
1 |
5 |
0.05 |
11.070 |
404.2 |
Significant |
Nigerian Natural Gas Utilization |
2 |
5 |
0.05 |
11.070 |
207.8 |
Significant |
Failure of Nigerian Natural Gas
Utilization |
3 |
5 |
0.05 |
11.070 |
198.3 |
Significant |
Strategies neglect in Management and
Utilization of Natural Gas |
4 |
5 |
0.05 |
11.070 |
162.2 |
Significant |
Process Implementation of Nigerian
Natural Gas Utilisation |
5 |
5 |
0.05 |
11.070 |
134.5 |
Significant |
Source: Field Work.
Table 4. Data summary.
Hypotheses |
Strongly Agree |
Agree |
Undecided |
Disagree |
Strongly Disagree |
I |
142 |
94 |
30 |
6 |
12 |
II |
73 |
94 |
30 |
45 |
42 |
III |
34 |
100 |
21 |
67 |
62 |
IV |
78 |
142 |
30 |
22 |
12 |
V |
68 |
92 |
55 |
34 |
35 |
TOTAL |
395 |
522 |
166 |
174 |
163 |
Source: Field Work.
Table 5. Nigerian natural gas utilization.
Nigerian Natural Gas utilization |
Strongly Agree |
Agree |
Undecided |
Disagree |
Strongly
Disagree |
Total |
Observed
Frequency Fe |
142 |
94 |
30 |
6 |
12 |
284 |
Expected
Frequency Fe |
79 |
79 |
79 |
79 |
79 |
|
Fo – Fe |
63 |
15 |
–49 |
–73 |
–67 |
|
(Fo – Fe)2 |
3969 |
225 |
2401 |
5329 |
4489 |
|
(Fo – Fe)2/Fe |
50.2 |
2.9 |
30.4 |
67.5 |
56.8 |
|
Calculated x2 |
50.2 |
+2.9 |
+30.4 |
+67.5 |
+56.8 |
=207.8 |
Source: Field Work.
Table 6. Process implementation of nigerian natural gas utilisation.
Process Implementation of Nigeria’s Natural Gas Utilization |
Strongly Agree |
Agree |
Undecided |
Disagree |
Strongly Disagree |
Total |
Observed Frequency Fo |
73 |
94 |
30 |
45 |
42 |
|
Expected Frequency |
104.4 |
104.4 |
104.4 |
104.4 |
104.4 |
|
Fo – Fe |
–31.4 |
–10.4 |
–74.4 |
–59.4 |
–62.4 |
|
(Fo – Fe)2 |
986 |
108.2 |
5535.4 |
3528.4 |
3894 |
|
(Fo – Fe)2/Fe |
9.4 |
1.04 |
53.0 |
33.8 |
37.3 |
|
Calculated x2 |
9.4 |
+1.04 |
+53.0 |
+33.8 |
+37.3 |
=134.5 |
Source: Field Work.
Table 7. Failure of nigerian natural gas utilisation.
Failure of Nigerian Natural Gas Utilisation |
Strongly Agree |
Agree |
Undecided |
Disagree |
Strongly Disagree |
Total |
Observed Frequency Fo |
34 |
100 |
21 |
67 |
62 |
|
Expected Frequency Fe |
33.2 |
33.2 |
33.2 |
33.2 |
33.2 |
|
Fo – Fe |
1.2 |
66.8 |
–12.2 |
33.8 |
28.8 |
|
(Fo – Fe)2 |
1.44 |
4462.2 |
149 |
1142.4 |
829.4 |
|
(Fo – Fe)2/Fe |
0.04 |
134.4 |
4.5 |
34.4 |
24.98 |
|
Calculated x2 |
0.04 |
+134.4 |
+4.5 |
+34.4 |
+24.98 |
=198.3 |
Source: Field Work.
Table 8. Impact of nigerian natural gas utilisation.
Impact of Nigerian
Natural Gas Utilisation |
Strongly Agree |
Agree |
Undecided |
Disagree |
Strongly Disagree |
Total |
Observed Frequency Fo |
78 |
142 |
30 |
22 |
12 |
|
Expected Frequency Fe |
34.8 |
34.8 |
34.8 |
34.8 |
34.8 |
|
Fo – Fe |
43.2 |
107.2 |
-4.8 |
-12.8 |
22.8 |
|
(Fo – Fe)2 |
1866.2 |
11491.8 |
23.0 |
163.8 |
519.8 |
|
(Fo – Fe)2/Fe |
53.6 |
330.2 |
0.66 |
4.7 |
15 |
|
Calculated x2 |
53.6 |
+330.2 |
+0.66 |
+4.7 |
+15 |
=404.2 |
Source: Field Work.
Table 9. Strategies neglected in management and utilisation of natural gas.
Stratifies Neglected on the Management and
Utilisation of Natural Gas |
Strongly Agree |
Agree |
Undecided |
Disagree |
Strongly Disagree |
Total |
Observed Frequency Fo |
68 |
92 |
55 |
34 |
35 |
|
Expected Frequency Fe |
32.6 |
32.6 |
32.6 |
32.6 |
32.6 |
|
Fo – Fe |
35.4 |
59.4 |
22.4 |
1.4 |
2.4 |
|
(Fo – Fe)2 |
1253.2 |
3528.4 |
501.8 |
1.96 |
5.8 |
|
(Fo – Fe)2/Fe |
38.4 |
108.2 |
15.4 |
0.06 |
0.18 |
|
Calculated x2 |
38.4 |
+108.2 |
+15.4 |
+0.06 |
+0.18 |
=162.2 |
Source: Field Work.