Accugas Limited, the midstream gas subsidiary of Savannah Energy, has secured a significantly expanded ₦773 billion local currency facility from a consortium of five Nigerian banks as the company moves to fully refinance its remaining U.S. dollar debt and strengthen its resilience against foreign exchange volatility.
In a statement released ahead of the final signing expected this June, Accugas confirmed that the upsized facility will replace the company’s existing Transitional Facility, which was originally structured at ₦340 billion in January 2024 with the same group of domestic lenders.
The local facility is aimed at repaying the outstanding balance of approximately $212.3 million on Accugas’ dollar-denominated facility, with full repayment targeted for completion in the second half of 2025. By aligning its primary debt obligations with the currency in which its revenues are generated, Accugas seeks to limit its exposure to persistent exchange rate fluctuations that have impacted the Nigerian energy sector in recent years.
“The final documentation for an increase in the Transitional Facility from ₦340 billion to up to ₦773 billion has been agreed with the lenders,” the company stated. “It is expected that the agreements will be signed this month, and this upsized facility will be utilised to enable the remaining outstanding balance of the Accugas US$ Facility to be repaid.”
Accugas, a key player in Nigeria’s domestic gas market, focuses on the marketing, processing, distribution, and sale of natural gas to industrial and power generation customers.
The company processed and transported an average of 145 million standard cubic feet per day (MMscfpd) in 2022 through its pipeline network, sourcing gas from Savannah’s 80 percent indirectly owned Uquo gas field.
Gas is processed at the company’s Uquo Central Processing Facility, which has a capacity of up to 200 MMscfpd, and is delivered to customers through a 260-kilometre pipeline network with transportation capacity of up to 600 MMscfpd.
The refinancing move reflects a broader shift by Nigerian corporates to restructure balance sheets in response to increased FX market volatility and sustained naira depreciation pressures.
The Central Bank of Nigeria’s ongoing foreign exchange reforms and fluctuating parallel market rates have pushed many companies to prioritise domestic currency funding where possible.
Accugas said that as of December 31, 2024, ₦332 billion of the initial Transitional Facility had been drawn down and converted to dollars to partially prepay its dollar debt. The latest deal will cover the remaining balance, ensuring the company’s debt profile better matches its naira-denominated cash flows.
Industry analysts note that the refinancing demonstrates stronger confidence in local banking partners’ capacity to fund large-scale midstream infrastructure operators.
The expanded facility is backed by five unnamed domestic banks that have consistently supported Accugas’ previous debt transactions.
The development is also expected to enhance liquidity and stability within Accugas’ operations, which are central to Savannah Energy’s strategy of securing reliable gas supply to domestic power plants and industrial customers.
Savannah Energy has continued to expand its upstream and midstream gas operations in Nigeria, positioning itself as a critical supplier in the country’s push for increased domestic gas utilisation to drive industrial growth and energy security.
With the new debt structure, Accugas aims to maintain predictable debt servicing costs while avoiding the impact of currency mismatches that can erode operating margins and cash flows.
The company reiterated its target to complete the full refinancing process before year-end 2025, aligning its funding framework with Nigeria’s broader shift toward local currency financing amid tight global credit conditions and foreign reserve constraints.
