Victor EzejaThe Nigeria National Petroleum Company Limited (NNPCL) has highlighted the benefits of the Brass and Olokola Liquefied Natural Gas (LNG) projects.
According to the national oil company, the revival of the LNG projects will help to maximize utilisation of the country’s abundant gas resources to boost power generation, create jobs, increase revenue generation and economic diversification.
Join our WhatsApp ChannelIn a statement on Friday, the NNPCL spokesperson, Olufemi Soneye, said the company has begun talks with investors with the goal of bringing the two LNG projects back on stream.
Soneye said the NNPCL Chief Financial Officer (CFO), Mr. Umar Ajiya, disclosed this on the sidelines of the ongoing 2024 Gas Technology Conference and Exhibition (Gastech), in Houston, United States, on Thursday, 19th September.
“Brass LNG and OK LNG are two LNG projects with the potential of manifold economic benefits for the country which include job creation, power generation, revenue generation and economic diversification,” Soneye stated.
According to NNPCL, the two multi-billion-dollar LNG projects were however stalled due to “unfavourable market dynamics and slow decision-making by the political class in the past.”
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Primebusiness.africa reports that the statement quoted the CFO as saying that “In the past, gas prices went down, the economics of the projects meant a high Capital Expenditure (CAPEX), and this was a dis-incentive for investors and partners. Also, there was slow decision-making by the political class.”
While describing NNPCL as a commercially driven company which recognises timely project development and execution, the CFO said there are abundant gas resources in many parts of the world and therefore, the earlier Nigeria makes smart decisions to bring partners to the table, the better.
Ajiya hailed President Bola Ahmed Tinubu for his support in driving new projects in the Industry through the Presidential Executive Orders on Oil & Gas Reforms.
“We are also happy to have the Petroleum Industry Act, 2021 (PIA) which has provided fiscal incentives for investors and is creating the enabling environment that has rekindled hope in the energy sector.”
Speaking on the Gastech conference, Ajiya said it is an avenue for NNPCL to learn new technologies which will help the Company decarbonise its operations and promote its abundant LNG resources to the global market.
Gastech is the world’s leading forum dedicated to delivering a more sustainable energy future by bringing together experts who brainstorm to create pathways towards global energy security for lasting climate impact, Soneye added.
The Brass and OK LNG Projects
Brass LNG project located in Bayelsa State, has an estimated annual capacity of 8.4 million metric tonnes. It was initiated in 2005 under the administration of President Olusegun Obasanjo.
Prime Business Africa recalls that 17 years after the Brass LNG project was abandoned, former Minister of State for Petroleum Resources, Chief Timipre Sylva, in April 2022 visited the site on an inspection tour. He said then that the government was looking for investors to revive the stalled gas project, and promised that it would be given top priority because of the government’s present policy thrust in gas exploration.
Also, the Olokola LNG project in Ogun State, birthed in 2007, was estimated to cost $9.8 billion and was expected to produce 22 million tonnes of LNG annually. The proposal was for Nigeria to invest part of its oil windfall savings to acquire 49.5% stake, with a target of 2012 for the completion of the first phase.
However, both Brass and Olokola LNG projects were later stalled by what the NNPC described as lack of Final Investment Decision (FID) coupled with lack of political will on the part of those in authority.
Victor Ezeja is a passionate journalist with six years of experience writing on economy, politics and energy. He holds a Masters degree in Mass Communication.
