Business

Indorama to build $1.8bn plants in Nigeria

Two plants worth $1.8 billion that will supply fertilizer and methanol will be built in Nigeria by Indonesia’s Indorama, the company said on Tuesday, in the latest proposal to increase agriculture and power in the country.

One plant will supply fertilizer to companies involved in agriculture, a sector in which President Goodluck Jonathan has pledged to create hundreds of thousands of jobs. The second facility will supply methanol to fuel local public transportation and industries, Indorama said in an e-mailed statement.

“We are committed to the development of the economy of Nigeria and the welfare of the Nigerian people through our investments,” said Manish Mundra, Indorama managing director, speaking on a visit to President Goodluck Jonathan in Abuja.

The plants will be built in Port Harcourt, the largest city in the vast Niger Delta wetlands region, the heartland of Africa’s largest energy industry. They will be run by Eleme Petrochemicals, a former subsidiary of the state-oil company bought by Indorama for $400 million when it was privatized in 2006.

Nigeria is Africa’s largest crude exporter and collects billions of dollars in oil revenue daily, but many of its 150 million residents survive on less than $2 a day, while businesses and homes are subject to constant power outages. To help improve the power situation Jonathan launched a “gas revolution” in March, weeks before he won a presidential election.

Power supply is one of the most important political issues for Nigerians. Successive governments have pledged to resolve the issue but have made little progress.

Jonathan’s administration is already working on a “gas masterplan” to try to improve the supply of gas to the domestic power sector, which he has pledged to privatize under another multibillion dollar blueprint launched last year.

Africa’s biggest energy producer has signed several memoranda of understanding with investors from China, Russia and the Middle East in recent years, many for projects that have yet to come to fruition.

India’s Nagarjuna Fertilisers said in March that it had committed to building two fertilizer plants, an investment of around $2.5 billion, while Saudi Arabian company Natpet, a subsidiary of petrochemicals company Alujain, said it would invest $3.5 billion in a petrochemicals plant.

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