Energy Sufficiency: IOCs ink MoU to build $5billion LPG facility in Nigeria

*H.E. Chief Timipre Sylva, Minister of State for Petroleum Resources,  assures the gas project will pave way for fresh investments, create jobs, support economic diversification agenda, and strengthen the development, distribution, penetration and utilisation of cooking gas in Nigeria

Gbenga Kayode | ConsumerConnect

In improving the reputation of the critical sector in the economy, three International Oil and Gas Companies (IOCs) have signed a Memorandum of Understanding (MoU) to construct a $5billion Floating Liquefied Natural Gas facility in Nigeria.

Regarded as the first ever in the country, the gas project with a capacity of 1.52 million tonnes per annum, is expected to process 176 million standard cubic feet of natural gas and condensates daily.

H.E. Chief Timipre Sylva, Honourable Minister of State for Petroleum Resources, at the signing ceremony involving Front End Engineering Design contract between UTM Floating LNG Limited, JGC Corporation, Technip Energies & Kellog Brown & Root Engineering, disclosed the project is the first Floating Liquefied Natural Gas facility in Nigeria.

The Minister affirm that the Petroleum Industry Act (PIA) 2021 is currently improving the reputation of the sector in the country.

Chief Sylva noted that the Act is paving the way for new investments, creating jobs, supporting the economic diversification agenda and strengthening Nigeria’s ability to fulfil the world’s expanding energy demand.

He also said: “There are generous incentives to enable development, distribution, penetration, and utilisation of gas.

“And this is why the UTM Offshore project will involve the development and financing of a 1.52 million tonnes per annum FLNG facility with a capacity to process 176 million standard cubic feet of natural gas per day and condensate.”

Sylva said: “I am aware that the UTM FLNG unit will also target the processing of associated gas currently flared in order to cut carbon emissions and monetise additional reserves for the domestic and global markets, which aligns with the Federal Government’s gas flare commercialisation programme and the decade of gas agenda.

“Let me take this opportunity to thank Afreximbank, under the leadership of its amiable President and Chairman, Dr. Benedict Okey Oramah, for orchestrating the signing of the MoU with UTM Offshore Limited to raise $5billion for the development of Nigeria’s first Floating Liquefied Natural Gas project.”

The Minister of State for Petroleum Resources, however, expressed hope that the MoU with the IOCs would bring additional collaboration between both entities to support a final investment decision on the project.

He added: “I look forward to more MoUs between Afreximbank and other entities to launch other firsts like the first Floating Methanol Production plant, first Floating Blue Ammonia Production plant, and other technologies with a view to creating a zero-carbon emission fuel in Nigeria.”