Browsing by Author "Igboanisi, Chinaemerem C."

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    Modelling of Nigeria’s Liquefied Natural Gas Shipping Trade
    (Federal University of Technology, Owerri., 2022-12) Igboanisi, Chinaemerem C.
    Nigeria has the largest proven natural gas reserves in Africa and its reserves ranked as ninth (9th) largest in the World- accounting for 188.8tcf (trillion cubic feet) of proven reserves as at the year 2019. However, Nigeria’s capacity to participate in the global natural gas shipping trade and earn freight revenue has been constrained by shipping tonnage market domination by other nations. Thus, as the nation strives to improve her revenue earnings through robust visible and invisible trade policy; it has become imperative to investigate empirically the determinants of Nigeria’s international shipping trade in Natural gas. This research developed the gravity model of Nigeria’s natural gas (NLNG) shipping trade to determine the factors affecting NLNG international freight market. The secondary data for the study comprised of volume of natural gas production (in billion cubic meters) shipped between Nigeria and other trading partner countries, geographical distance data between trading partner countries, population mass of trading partners, price of natural gas and bilateral trade agreements. Others include: logistics performance indices and shipping freight rates. These were sourced from global databases, Nigeria LNG limited, the Nigerian Ports Authority and covered the periods between years 2003 to 2020. To address the hypotheses governing this research, we developed an augmented gravity model of natural gas shipping trade in Nigeria’s international freight market and examined trends in demand. The following variables were found statistically significant in explaining NLNG trade namely: quality of transport infrastructure (-225.448), geographical distance (-232.721), trade agreement (42.534) and population mass (0.955). These coefficients are in their natural logs and can therefore be interpreted as elasticities. In terms of most important trading blocs or shipping routes, the most important shipping routes (which are dummy variables) are namely: The United States of America (3,360.056), EuroAsia (3,090.082), Europe (904.810) and South America (786.413). These findings indicate that robust policy interventions are needed to promote trade with our trading partners. Robust investments are also needed in our transport infrastructure quality (especially that of bunkering facilities for LNG vessels) in order to reduce impediments to trade. From the positive trend analysis results, demand for natural gas is positive and the federal government should encourage more private sector investment in LNG shipping fleet to increase Nigeria’s participation in LNG international freight market. As recommendation for further studies, modelling of constraints of natural gas trade involving gasification and re-gasification stations should be explored in order to expand the scope of the present work.