Business a.m
In a bid to further increase natural gas usage in the country and improve Nigeria’s gas revenues, NNPC Limited has signed two major agreements to supply LNG to the domestic gas market and the international LNG market.
During two separate signing ceremonies held on the sidelines of the United Nations’ Climate Change Conference (COP28), NNPC Ltd signed a Memorandum of Understanding (MoU) with Wison Heavy Industry Co. Ltd., a Chinese company, to develop a floating liquefied natural gas (LNG) project in Nigeria targeting the international LNG market. The project is aimed at increasing the supply of LNG to the global market and will be developed by a consortium of Nigerian and Chinese companies.
NNPCL disclosed that NNPC Prime LNG Ltd, a subsidiary of NNPC Trading Ltd, signed a supply, installation and commissioning agreement with SDP Services, an independent oil and gas company, for a 421-tonne-per-day LNG project targeting the domestic LNG market. This project is expected to increase the supply of LNG to the domestic market, helping to meet Nigeria’s growing energy needs
The Floating LNG MoU was signed by Olalekan Ogunbayo, executive vice president of gas, power, and new energy at NNPC Ltd, and Kai Xu, managing director of Wison Ltd, on behalf of their respective companies. The two parties agreed to collaborate to develop a roadmap for the project that would lead to an investment decision. The roadmap will include the identification of potential sites for the floating LNG facility, the development of engineering and design plans, and the preparation of a cost estimate for the project.
Lawal Sade, managing director of NNPC Trading Ltd., signed the Small-Scale LNG (SSLNG) Project agreement on behalf of NNPC Prime LNG Ltd, while Abhinav Modi, managing director of SDP Services Ltd., signed on behalf of his company. The SSLNG Project, which will be located at Ajaokuta in Kogi State, Central Nigeria, will help ensure a reliable and efficient supply of LNG to the Autogas/Compressed Natural Gas (CNG) and industrial/commercial customers nationwide and is scheduled to begin operations by December 2024.
Commenting on the signing of the agreement, Olalekan Ogunleye, executive vice president of gas, power, and new energy at NNPC Ltd., said that the company is committed to providing gas to industries nationwide and accelerating its gas commercialization efforts through the Floating LNG Project.
Ogunleye said, “We see both projects have an enormous impact all over the country because they are central to the commercialization of Nigeria’s abundant gas resources and ensuring that our country earns the much-needed foreign revenue from its abundant gas assets. It is also consistent with NNPC Management’s drive to deliver on Mr. President’s gas and power aspirations across the country.”
Speaking after the signing ceremony, Lawal Sade, managing director of NNPC Trading Ltd., stated that the Small-Scale LNG Project would promote the domestic use of LNG by supporting the expansion of auto-gas initiatives across the country. Sade stated that the project would help to reduce the country’s reliance on imported petroleum products and improve energy security. He added that the project would also help to create jobs and develop skills in the local gas sector.
In his words, “We are looking at a time frame of 12 months from execution to the commissioning of the project. The project will deliver about 420 tonnes per day of LNG per day into the domestic market, which will enhance efficient delivery of gas to the auto-gas/CNG and industrial customers in line with the presidential mandate.”
