China to Provide 85% Funding for $2.8bn AKK Gas Line Project

ExxonMobil: blockade threatens oil production

Chineme Okafor in Abuja

The Nigerian National Petroleum Corporation (NNPC) has received the assurance of China National Petroleum Corporation (CNPC) that it was committed to helping it secure up to 85 per cent of $2.8 billion it requires to build the Ajaokuta-Kaduna-Kano (AKK) pipeline project, a statement from the corporation yesterday disclosed.

This is coming as ExxonMobil yesterday raised the alarm that a blockade by former employees threatens crude production at oil facilities in Nigeria, adding that “disruptions to these operations have the potential to significantly impact revenues.”

The statement which was signed by the Group General Manager, Public Affairs of the NNPC, Mr. Ndu Ughamadu, and sent to THISDAY in Abuja, explained that the Group Managing Director of NNPC, Dr. Maikanti Baru, got the assurance from CNPC during a high-level meeting between both corporations.

It stated that the meeting was held on the sidelines of the ongoing fßorum on China-Africa Cooperation (FOCAC) Summit in Beijing, China.

According to it, the AKK gas pipeline would enable connectivity between the East, West and North that is currently non-existent. It would also enable gas supply and utilisation to key commercial centres in the northern corridor of Nigeria with the attendant positive spin-off on power generation and industrial growth.

The statement also added that financing for the 40-inch by 614 kilometres (km)AKK gas pipeline is expected to cost about $2.8 billion, and 85 per cent of the money is expected to be funded by the financiers which include Industrial and Commercial Bank of China (ICBC), Bank of China, and Infrastructure Bank of China with Sinosure, China’s Export Credit Agency (ECA) providing insurance cover, while the remaining 15per cent will be provided by the contractors which include Oilserve/Oando consortium, as well as Brentex/China Petroleum Pipeline (CPP) Bureau consortium.

Meanwhile, ExxonMobil yesterday raised the alarm that a blockade by former employees threatens crude production at oil facilities in Nigeria, adding that “disruptions to these operations have the potential to significantly impact revenues.”

The company made the announcement in a statement after a six-week blockade by former workers at the oil facilities.

Mobil Producing Nigeria, the ExxonMobil subsidiary that released the statement, produces over 550,000 barrels per day of crude oil, condensates and natural gas liquids, according to the company website.

The blockades were described in ExxonMobil’s statement as the “playing of loud music, defacing of company facilities and intimidation of personnel.”

The “continued denial of access to production facilities could impact the company’s ability to safely continue production operations,” ExxonMobil said