$16bn Ogidigben Gas City’ll revolutionize Nigeria—Gov Uduaghan

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LAST month (April), the Governor of Delta State, Dr. Emmanuel Uduaghan, visited the riverside community of Ogidigben, approximately 220 km, southeast of Lagos and 60 km west of Warri, to inspect the project sites of the $16 billion Gas Revolution Industrial City and proposed Marine University, Okerenkoko, both in Warri South-West Local Government Area, preparatory to the ground-breaking ceremony by President Goodluck Jonathan, evidently, this month (May).

uduaghan1111Project Director of Julius Berger, which is handling the gas city, Mr. Tom Grousser, had informed the governor that the company mobilised to site in January and has completed 60 per cent of bush clearing, which will be completed in August. Uduaghan spoke with delight about the gas city, a public-private initiative, involving the Federal Government, private investors and Delta State Government, which he said would turn the state into the industrial base of the country.

For the communities, which are squabbling over the location of the project, he said there was no need fighting for the crumbs when the bigger cake is coming. And back to Government House in Asaba, he took time off, during the week, to speak to Vanguard on the significance on the project. Excerpts:

There is an unusual spring in you as you talk about the upcoming EPZ project in Ogidigben, what is it all about?
The project is actually a Federal Government-driven project. The intention is to harness the country’s abundant gas resources to realize its 2020 vision of becoming one of the 20 largest economies in the world. But the special thing for me and Deltans is that Delta, the “Finger of God” is the host state and the impact will reverberate all over the state and country.

The Gas City is a greenfield development built around a major central gas processing facility that will produce pipeline gas from the domestic gas market, especially for power generation, and supply gas to an industrial complex within the Gas Revolution Industrial City that will include world-scale fertilizer and petrochemical plants. Actually, the wet gas is collected, dried and turned to dry gas. Like I said, with the gas city, there will fertilizer and petrochemical plants and the agricultural sector will be transformed because a lot of fertilizer is required for agriculture.

For the petrochemical, it involves a lot of production and so, the gas city is a very huge project. It is an integral part of the Nigeria Gas Master Plan, and will serve as a model for future development elsewhere in the country. The development is being managed by the Ministry of Petroleum Resources, so you can see why I am excited. The whole idea is in consonance with our Delta-beyond-oil agenda.

Innternational oil companies
The Ministry of Petroleum Resources is leading the development through a consortium, headed by the Nigeria National Petroleum Corporation. Two of the world’s largest international oil companies, Shell and Chevron, and another Nigerian company, Sahara Energy Resource Nigeria Limited, SERNL, are part of it.

The gas processing facility will built initially with gas processing capacity of 500-800 MM scf/d and is planned ultimately to process 2Bscf/d of natural gas and supply ethane to a world-scale petroleum plant to be built by Saudi Arabia’s Xenel Industries. Can you feel why we are joyous?

What is the state government doing to ensure that communities in the area understand the importance of this project?
We have tried to educate them. In fact, I had to hold a stakeholders’ meeting with the various communities and I brought technical experts on the project, they addressed them in Warri with slides and all that, telling them the gains.

But you see, it will take sometime, it is a process, which is why when we have the opportunity, we try to educate them on the many opportunities that are there. They should look more into the future. What is coming here once it succeeds, generations unborn will benefit so much from it.

Koko was initially to host this project, why was it moved away?
The anchor tenant – that is the company that will come and set up the fertilizer plant found out when they came to assess the whole area that in the distribution of their product, it will be difficult for big ships to come in to Koko. So Koko from their findings will be challenging for evacuation of their products, except they use smaller ships and that is not cost effective because they might run a loss if they do that.

The alternative was dredging the channel into Koko and from the Nigeria Ports Authority, NPA, the initial assessment, is about $1 billion to do the dredging alone. And after doing that, you are not even sure of how long it will take before the silting process starts again and it will require another dredging. Simply put, evacuation of the product will be quite complex and even the importation of the things to be used will require another location. So, Ogidigben was chosen because it has a bigger channel.

Location of the project
It is important that Deltans understand what really happened. The location of the project on the east bank of the Escravos River, opposite Chevron Nigeria Limited, CNL’s Escravos facilities, gave Ogidigben several advantages. One is that it is by the ocean, providing easy access for shipping and export to coastal and other international markets.

Second is that is by the riverside, enabling for inland transportation via the Escravos River to inland markets such as nearby Warri and Sapele, and further a field via Forcados and Niger Rivers, third is that it is a more convenient location to gather gas and fourthly, it is close to the Escravos-Lagos Pipeline System, ELPS, to deliver pipeline gas to consumers in western and central Nigeria.
What really is the role of the Delta State government on this project?
Delta State government is partnering with the federal government and other investors. We have issued a Certificate of Occupancy for the 2,700 hectares site for the Gas Revolution Industrial City.  There are lots more we are going to do as the project progresses.

Some stakeholders, particularly Ijaw communities are complaining that 70 per cent of their land was taken for the project and they were not carried along. Some have even threatened that there will be trouble if the problem is not resolved before the ground-breaking?
It is not true that Ijaw own 70 per cent of the land. The project is not even about who owns the land like I mentioned earlier because eventually, it is going to be bigger than who owns the land. And that is what I keep emphasizing to them; people are fighting over what I call the small crumbs, whereas the big cake (laughs) is up there. So this is not the time to start fighting over land, we own land and all that.

I called all the communities and have spoken to them, it will start from one community and as the project is expanding, it will also involve other communities. It is not just the host communities that will benefit from the project, other parts of Delta State will benefit, the whole of Nigeria will benefit. The Koko that we are talking about now will also benefit.

How many jobs are likely to be created?
The job creation will be in phases. This initial time, they are clearing, Julius Berger has come in and all that, some people are supplying items to the workers there, some direct and indirect jobs, that is just clearing alone. Then when the construction starts, of course, a lot of other persons will benefit. So it is something that will employ thousands and thousands of persons. Fortunately, we have an experience from the Escravos Gas-to-Liquid plant that has just been completed.

Process of construction
The process of construction employed a lot of our people, especially our young ones and a lot of other persons supplied all sort of things. Because of gas process being used for fertilizer and fertilizer for agriculture, the petrochemical plant will stimulate other industries.

What is the development strategy?
The gas city will be developed in phases. In the first phase, it will comprise key anchor projects like the CPF, 150 MW independent power plant, IPP, 2.6 Mtpa fertilizer plant and infrastructure, including roads, a new port, residential, commercial accommodation and public facilities. Later phases will see the expansion of the CPF, addition of major petrochemical facility and additional gas-based, secondary and service industries.

Ultimately, the intent is to build a processing capacity to the point where there would be enough ethane available to supply a world-scale petrochemical plant. This would be implemented in phase 3, which would expand the CPF capacity to 2,400 MMscf/d
There is something that people do not know yet. The Gas Revolution Industrial City is the first industrial complex to be developed under the Gas Revolution Agenda. It is a model that will be replicated in other industrial complexes to be established in the Niger-Delta region where gas is available.


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