EFFECT OF GAS UTILIZATION ON ECONOMIC GROWTH OF NIGERIA
Keywords:
Gas Utilization, Domestic Gas Market, Export Gas Market, Economic Growth, Gross Domestic ProductAbstract
Oil and Gas sector in Nigeria contribute massively to government revenue and foreign exchange earnings. Natural gas resources are utilized within the country and abroad. This study evaluated the effect of gas utilization on economic growth of Nigeria from 1999 to 2021, using data sourced from Nigerian National Petroleum Corporation (NNPC) and the Organization of the Petroleum Exporting Countries (OPEC) and the Annual Statistical Bulletins. The population of this study comprised of eleven gas production and utilization companies included in Nigerian National Petroleum Corporation annual statistical bulletin as at 2021. The study adopted ex-post facto research design. This study adopted Evsey Domar Exogenous theory of economic growth. The descriptive statistical techniques such as mean, standard deviation, skewness and kurtosis using statistical package for social sciences (EViews 13.0) in which annual time series data from 1999 till 2021 were used. Pearson Correlation test was performed to show the associations between the independent and dependent variables, however, the multiple regression model was adopted. It investigates its relationship as a function of Domestic Gas Market (DGM) and Export Gas Market (EGM). The regression coefficients for Domestic Gas Market (0.469745) and Export Gas Market (0.367948) indicated positive impacts on GDP. Moreover, the correlation analysis highlighted strong positive correlations between GDP and both Domestic Gas Market (0.86399) and Export Gas Market (0.82387). These results echo the intricate relationship between energy dynamics and economic growth, where increases in Domestic Gas Market and Export Gas Market coincide with GDP growth at 5% level of significance. Hence, we conclude based on the study findings that Domestic Gas Market and Export Gas Market have significant positive effect on the economic growth of Nigeria, and recommend that it is critical to make smart investments in domestic gas infrastructure and liquefied natural gas infrastructures. Building a solid infrastructure for the storing, distribution and transportation of gas must be Nigeria's top priority while focusing on leveraging natural gas resources to drive economic growth.
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