Kachikwu tasks NLNG on expansion beyond Train 7
The Minister of State for Petroleum Resources, Dr Ibe Kachikwu, has tasked the Board and Management of Nigeria LNG Limited to expand the production volumes beyond what Train 7 will bring to catch up with other countries, secure a significant share in the global LNG market, and help with domestic supply of LNG in line with the company’s vision to help build a better Nigeria.
The Minister said over the weekend when he visited the NLNG Plant on Bonny Island, Rivers to assess the company’s state of preparedness for the construction of a new that will lift the country’s Liquefied Natural Gas Production (LNG) output by 35% from 22 Million Tonnes Per Annum (MTPA) to 30 MTPA.
The Minister was received by the Managing Director of NLNG, Tony Attah; NLNG’s Deputy Managing Director, Sadeeq Mai-Bornu; NLNG General Manager, Production, Tayo Oginni; and NLNG’s General Manager, Human Resources, Eucharia Ezeani.
The Minister was accompanied by the Permanent Secretary of the Ministry of Petroleum Resources, Dr Folashade Yemi-Esan; the Group Managing Director of Nigerian National Petroleum Corporation (NNPC), represented by Salihi Dawaki; Director of the Department of Petroleum Resources (DPR), represented by Deputy Director, DPR, Mr Sanya Bajomo, Executive Secretary of the Nigerian Content Development Monitoring Board (NCDMB), Engr. Simbi Wabote; Special Technical Adviser (R&D), Rabiu Suleiman; Ministry officials; and other officials of agencies under the Ministry.
Speaking during a tour of the six-train plant complex and the Train 7 site, Dr Kachikwu said “Train 7 doesn’t have a good history in terms of operations. President Muhammadu Buhari will tell you when they started this project, they targeted 12 trains. Through no fault of yours, Train 12 hasn’t happened, but Train 7 is coming. Now, you have Train 7 largely ready to go. What excites me is that this Train will be bigger than the other individual trains but in your 30 years outlook, you have to begin to look at Train 8. We need to catch up.
“The transition to cleaner energy is going to happen faster than you think. As we reconstruct our refineries, we are going to be looking at how to make them more green friendly, but every indicator of our studies shows that the fastest move we are going to make to green energy is on gas. Although your market today is focussed on externalisation, you will soon see government policies drive you towards internalisation very rapidly. So you need to grow those volumes for the teeming population we have. I challenge you to look at this and grow from the 30 MTPA you are talking of now to about 40 MTPA over the next 30 years,” he charged.
“One of the things we say every time to people is that they should look at the Nigeria LNG model. The model has stood the test of time. It has worked, it is efficient, non-interventionist and very transparent. To all of you who are leaders here, you need a lot of praise and support for the consistency to which you have delivered. This country can be better if we manage it well. What NLNG and a lot of the Joint Ventures bring to the table is that there are a lot of Nigerians with the capabilities of great management.”
While briefing the Minister on NLNG’s operations, Attah said it was time for Nigeria to use gas as a catalyst for industrial and economic transformation.
“With the support of NNPC, our ambition remains to grow through Train 7. We built six trains fast because every 18 months we were adding a train, but from 2007 to date, we have not been able to move. But with your support and that of the Federal Government, we have the full backing of all critical stakeholders. The stars have lined up in support for our expansion project and we are at a point of no return. So, for us, it is about the future and more importantly, the licence to grow which is about dealing with today’s realities and peculiarities. The starting point for us is safety. We work in a complex and intricate environment and safety is everything for us in keeping our people safe and assets safe to deliver value to our shareholders,” he said.
Expressing appreciation to the Federal Government for the support for Train 7, NLNG Deputy MD, Mai-Bornu, said the Minister’s visit to Bonny was a boost toward the Final Investment Decision (FID).
“In the long run, the benefit of a bigger market share in that space will translate into more revenue for our nation through taxes and shareholding for the Federal Government through the NNPC which currently holds 49% shares in NLNG.
“Additionally, this country will witness more transformational CSR initiatives sponsored by Nigeria LNG, as we have demonstrated keen and concerted resolve in fulfilment of our commitment towards helping to build a better Nigeria,” he added.
The Minister’s visit is coming on the heels of the milestone events in preparation for Train 7 construction, which include the award of contracts for the Front End Engineering Design (FEED) by NLNG and the repayment of US$5.45 billion Shareholder loan for its existing trains, signifying readiness to seek funding for the new project.
NLNG will be seeking funding in the financial market for the Engineering, Procurement and Construction (EPC) of Train 7 and investment in the upstream gas sector in Nigeria that will ensure the sustainability of feedgas supply to its existing trains (Trains 1 to 6) and the new train .
NLNG is owned by four Shareholders, namely, the Federal Government of Nigeria, represented by NNPC (49%), Shell Gas B.V. (25.6%), Total Gaz Electricite Holdings France (15%), and Eni International N.A. N. V. S.àr. l (10.4%).