Ardova Targets 100 CNG Stations in 24 Months With Powergas Acquisition

Ardova Plc plans to establish compressed natural gas refuelling infrastructure at 100 locations across Nigeria within 24 months as the energy company moves to acquire Powergas in a transaction designed to expand its position in the country’s growing gas market.

The expansion will combine Ardova’s existing retail network with Powergas’s gas sourcing, compression and distribution infrastructure, giving the company a platform to supply CNG to motorists, commercial fleets and industrial consumers.

Ardova is leading a consortium with Diadem Energy Services Limited to acquire Powergas Global Investments Nigeria Limited and Powergas Ebedei Limited from A.P. Moller Capital-backed entities.

Financial terms of the proposed acquisition were not disclosed.

Completion is expected around the end of 2026, subject to regulatory approvals and other customary conditions.

The transaction represents more than an ownership change for Powergas with Ardova planning to use the acquired infrastructure as the foundation for a significant expansion of its natural gas business.

Ardova intends to integrate CNG refuelling infrastructure into its existing retail network and establish 100 CNG locations nationwide within the first 24 months following the transaction.

The strategy could allow the company to expand more rapidly than operators required to develop an entirely new network of standalone gas stations.

Ardova already operates an extensive downstream distribution business covering petroleum products and LPG, giving it existing locations, customers and logistics capabilities that can be combined with Powergas’s natural gas operations.

Powergas provides another part of the infrastructure required for that expansion.

The company operates CNG production and distribution facilities and has developed a virtual pipeline model that allows compressed natural gas to be transported by road to customers without direct access to conventional gas pipelines.

Powergas says its infrastructure has production capacity exceeding 10 million standard cubic metres of gas per month and has supported more than 100,000 CNG deliveries.

Its operations provide gas to industrial customers that require alternative energy supplies but are located beyond Nigeria’s limited pipeline network.

Combining those capabilities with Ardova’s retail footprint could expand the use of the same gas-distribution system into the transportation market.

Nigeria has been encouraging motorists and commercial transport operators to adopt CNG as an alternative to petrol and diesel, particularly following the removal of petrol subsidies and the resulting increase in conventional fuel prices.

One of the constraints, however, has been the availability of refuelling infrastructure.

Expanding the number of CNG stations is critical because motorists are less likely to convert vehicles where reliable refuelling points are unavailable, while investors face difficulty committing capital to stations without sufficient numbers of converted vehicles.

Ardova’s 100-location target would address part of that infrastructure constraint while allowing the company to participate in both the supply and retail sides of the CNG market.

The Powergas acquisition also gives Ardova access to infrastructure further up the gas supply chain.

Powergas Ebedei operates gas-processing and compression facilities in Delta State, where gas is processed and compressed before being transported to customers.

Ardova plans to expand compression capacity along gas-producing corridors and establish additional relationships with upstream producers.

Under the strategy, the company could serve as an offtaker for producers seeking markets for associated and other gas resources.

That could also create commercial opportunities around gas that might otherwise be flared because producers lack the infrastructure or customers required to monetise it.

Instead of relying entirely on fixed pipelines, compressed gas can be loaded into specialised transportation equipment and moved to industrial facilities, filling stations and other consumption points.

Diadem Energy’s involvement in the acquisition strengthens the logistics component of the strategy.

The company has previously worked with Powergas as a virtual-pipeline logistics partner, giving the consortium experience in transporting compressed gas between production facilities and customers.

The proposed ownership structure therefore brings together Powergas’s sourcing and compression infrastructure, Diadem’s logistics capabilities and Ardova’s downstream distribution and retail network.

Ardova ultimately intends to extend the gas platform beyond Nigeria into other West African markets.

That would give the company an opportunity to replicate elements of its CNG and virtual-pipeline model in markets where natural gas resources exist but conventional pipeline infrastructure remains limited.

The immediate priority, however, will be completing the acquisition and executing the planned Nigerian expansion.

A.P. Moller Capital entered the Powergas investment through its Africa Infrastructure Fund I in 2019.

During the investment period, the Powergas Ebedei project progressed through development, construction and commissioning, creating infrastructure for processing and distributing gas that could otherwise have limited routes to market.

The sale to the Ardova-led consortium marks the next ownership phase for the business.

For Ardova, success will depend on converting the acquired infrastructure into a substantially larger distribution platform.

The company’s target of 100 CNG refuelling locations within 24 months provides a measurable benchmark for that strategy.

If executed, the expansion would move Ardova further beyond its traditional petroleum-products business and give natural gas a larger role across its retail, industrial and transportation energy operations.