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NNPC, NLNG sign $2.5bn gas supply agreement

By Michael Eboh

The Nigerian National Petroleum Corporation, NNPC, Saturday, said it has signed a $2.5 billion pre-payment agreement with the Nigerian Liquefied Natural Gas, for the development of upstream gas projects to supply gas to Trains 1 – 6 of the NLNG.

Mele Kyari, NNPC
Group Managing Director, Mele Kyar

In a statement in Abuja, Group Managing Director of the NNPC, Mallam Mele Kyari, said the agreement would help resolve the issues around gas supply to Trains 1 – 6, stressing that there was need to fast-track action on the process of bringing more trains on stream.

Kyari, who was speaking at the agreement signing ceremony, disclosed that the pre-payment gas supply agreement was a milestone which aligned with the Federal Government’s aspirations of monetizing the nation’s enormous gas resources and protecting the federation’s investment in the NLNG.

He added that the agreement would ensure full capacity utilization — 22 million tonnes per annum, MTPA, Liquefied Natural Gas LNG and five mtpa Natural gas Liquids, NGL — of Trains 1-6 plants; generating employment, and provide new vistas of growth opportunities in the nation’s LNG sector.

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He challenged shareholders of the NLNG to work very quickly towards expanding the production capacity of the company beyond Train 7 to take advantage of developments in the global LNG market.

He noted that though NLNG has been a huge success as a company, it must go beyond its current achievements and initiate other viable projects capable of generating better return on investment.

He said, “Here at NNPC, we are thinking beyond Train 7; if your ambition is Train 7. Actually, our thinking should be on what else we can do or what other projects we can work on as quickly as possible to take advantage of the enormous potential in-country.

“There is also the need for us to take advantage of what is happening in the global market and do things very differently. There are opportunities there and our company must move into those locations and we must move fast.”

Earlier in his address, the Managing Director of NLNG, Engr. Tony Attah, noted that the signing of the gas supply pre-payment agreement was a significant step towards ensuring the company’s business sustainability and competitiveness.

He called for support to ensure that the Final Investment Decision on the Train 7 Project is taken this year without fail, adding that the project was no longer an ambitious one in the light of developments in the global LNG market.

Highpoint of the occasion was the signing of the gas supply pre-payment agreement which was witnessed by the Country Chairman of Shell Companies in Nigeria, Mr. Osagie Okunbor, and representatives of Total, Eni/NAOC, amongst others.

In another development, NPDC, the upstream subsidiary of the NNPC, Friday, reported a fire incident which occurred at Oil Mining Lease, OML 20 at Egbema-West, Imo State on Monday, October 7, 2019.

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Managing Director of the NPDC, Mr. Mansur Sambo, stated that preliminary investigation revealed that a spark, which ignited the fire during a bunkering activity by vandals, might have caused the incident, which occurred in Well–18T, located within the flooded part of Abacheke Community.

Further report released by the Community Liaison Officer in charge of Abacheke Community indicated that no fatality was recorded.

NPDC stated that appropriate action to minimize the impact of the fire and ensure safety of the community had been taken.

The Upstream company said following successful aerial surveillance carried out Wednesday 9 October, the company was mobilizing and employing the services of a reputable Safety consultant to completely put out the fire.

NPDC advised members of Abacheke community and its environs to avoid the affected area and stay calm, promising to update the general public on the incident soon.

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