How NNPCL, Partners Broke Record with Three Critical Gas Projects Months Before Delivery Date
Ifeanyi Onuba
Last Wednesday, President Bola Tinubu inaugurated three critical gas infrastructure projects that were implemented by the Nigerian National Petroleum Company Limited and its partners.
The commissioning of the projects is in line with the president’s commitment to significantly leverage gas to grow the Nigerian economy.
The three projects commissioned by the president were the AHL Gas Processing Plant 2 (GPP – 2) – 200mmscf/d which is an expansion to the Kwale Gas Processing Plant (GPP – 1); the AHL Gas Plant, which is being developed by AHL Limited, an incorporated Joint Venture owned by NNPC Limited and SEEPCO; and the ANOH-OB3 CTMS Gas Pipeline Project.
The event was attended by the Governor of Delta State, Sheriff Oborevwori; the Governor of Imo State, Hope Uzodimma; the Minister of State for Petroleum Resources (Gas), Ekperikpe Ekpo; the NNPCL Board Chairman Chief Pius Akinyelure and the Group Chief Executive Officer of the NNPCL, Mele Kyari.
Others in attendance are the Managing Director of AHL, Mohit Barot; the Managing Director of Seplat Roger Brown, and other top officials in both the private and public sectors of the economy.
The Ashtavinayak Hydrocarbon Ltd (AHL) project, a joint venture between the Nigerian National Petroleum Company Limited (NNPC) and Sterlin Exploration & Energy Production Company Limited (SEEPCO), is designed to process 200 million standard cubic feet of gas per day, with the capacity to scale up to 240 million standard cubic feet of gas per day.
The processed natural gas from AHL will be delivered to OB3 in Rivers State, providing cleaner and more conveniently usable fuels to facilitate social, economic, and technological development.
The AHL project is much more than the economic gains it has in store. It guarantees sustainable development, achieved through Public-Private partnerships, and the monetization of the entire gas business value chain across midstream and downstream segments.
The AHL Gas Processing Project is also expected to generate over $500million in the next 10 years. During construction, it provided over 300 direct jobs, and during operations, is poised to generate over 2000 direct and indirect jobs.
The benefits of the NNPC / SEEPCO AHL project are manifold, and it is a game changer in the energy sector as it will guarantee the household uptake of LPG.
It will also ensure lean gas for power generation, to gas and NGLs for the petrochemical industry, reduced gas flaring leading to improved agriculture and environment, increased tax revenues contributing to state development, and improved quality of life through domestic LPG supply.
The president, while speaking during the commissioning, expressed surprise about the speed, efficiency, and technical competence demonstrated by the NNPCL and its partners in the execution of the project.
Tinubu who described the projects as vital for his administration’s “Renewed Hope Agenda” specifically commended the NNPC Ltd and the Group Chief Executive Officer, Mele Kyari for ensuring that the projects were delivered far ahead the scheduled date for its completion.
He said: “I congratulate NNPC in particular because, when we resumed 11 months ago, I asked of these projects. I made my priority and the administration’s priority clear on gas for prosperity, and they said this might take two years.
“These three projects, upon later review, they didn’t make further promises but said they would surprise Nigerians. Today is a great day for your achievement, demonstrating teamship, commitment, and dedication to duty.
“I congratulate all of you, the entire team, for what you have done for the country to achieve these projects in less than two years. Eleven months fulfillment of promise. I thank all of you.”
He said the delivery of the projects was accelerated from the inception of the administration in keeping with the overall objective of deepening domestic gas supply as a critical enabler for economic prosperity.
The projects will increase gas supply to the domestic market by approximately 500mmscf/d, creating a better investment climate and promoting balanced economic growth cumulatively.
Tinubu said the inauguration event is highly significant to the country as it demonstrates the administration’s concerted efforts to accelerate the development of critical gas infrastructures geared at significantly enhancing the supply of energy to boost industrial growth and create employment opportunities.
Also, he said the projects are fully in line with the Decade of Gas initiative, and the federal government’s quest to grow value from the nation’s abundant gas assets while concurrently eliminating gas flaring and accelerating industrialization.
He commended the strategic vision of the NNPC Limited and its partners Sterling Oil Exploration & Energy Production Company Limited (SEEPCO) and Seplat Energy Plc for this laudable and value adding projects.
The president said: “It is pleasing that approximately 500MMscf of gas in aggregate would be supplied to the domestic market from these two Gas Processing Plants, which represents over 25 per cent incremental growth in gas supply.
“In practical terms, this is more gas to the Power Sector, Gas-Based Industries, and other critical segments of the economy. I therefore commend the strategic vision of the NNPC Limited and its partners Sterling Oil Exploration & Energy Production Company Limited (SEEPCO) and Seplat Energy Plc for these value-adding projects.
“From the outset of this administration, we have been very clear of our intention to leverage on the virtually unlimited capacity of gas to drive economic growth. Aside from the presidential CNG initiative which is aimed at moving the good people of Nigeria away from petrol and diesel as vehicular combustion fuel, significant progress has also been recorded in incentivising gas development through Presidential Executive Orders.”
The president assured Nigerians that these projects are just the beginning, as the federal government is stepping up its coordination of other landmark projects and initiatives that will ensure the earliest realization of gas fueled prosperity in the country.
He assured investors in the energy space that this is an investment enabling government, and the government will not relent in facilitating the ease of doing business.
He said: “The theme of this commissioning – ‘From Gas to Prosperity; Renewed Hope’ must be adopted by all gas sector participants and would-be investors as a clarion call to ramp up efforts to accelerate investment and developments of projects in the gas sector on a win-win basis.
“I would once again commend the efforts of NNPC Limited, alongside SEEPCO and Seplat Energy, on this business partnership initiative and congratulate you all on the successful implementation of the three projects
“Finally, I want to reiterate the federal government’s resolve to continue to provide support in deepening domestic gas utilization, to increase national power generation capacity, revitalise industries and create multiple job opportunities for economic growth.
“Today, I have the singular honour to commission the expansion of the AHL Gas Processing Plant, the ANOH Gas Processing Plant and the 23.3Km ANOH to Obiafu-Obrikom-Oben(OB3) Custody Transfer Metering Station Gas Pipeline Projects in line with this administration’s resolve to provide energy for Nigerians, and to use our vast natural gas resources to transform Nigeria.
“I urge NNPC limited as our national energy company of choice to continue its relentless efforts and record more successes in the energy sector for the benefit of all Nigerians. ‘From Gas to Prosperity, with a Renewed Hope.”
In his remarks, the petroleum minister said in keeping with the climate control agenda, the government decided to use gas as the transition fuel to achieve green energy by 2060.
He said the administration of President Bola Tinubu has been putting projects in place to ensure the decade of gas project is achieved, adding that these projects are critical to achieving that.
The minister said the plant will promote rapid industrialization in Nigeria and described it as a shining example of the drive to boost power generation and strengthen industrialisation.
He said: “I would especially like to express my gratitude to His Excellency, President Bola Tinubu, GCFR, President and Commander in Chief of the Armed Forces of Nigeria, whose inspiring leadership has been the driving force behind our progress toward a future full of opportunity and promise.
“Mr. President, the decision to eliminate fuel subsidies at the start of your administration has compelled increased spending in the upstream and midstream gas development, and the use of gas as an appropriate, more cost-effective, and cleaner alternative to diesel and gasoline.
“Furthermore, in keeping with the climate control accord, this measure solidifies the use of gas as our transition fuel as we move the nation toward achieving green energy sufficiency by 2060
In his remarks, the NNPCL GCEO commended the president for his support and added that the pressure he gave the team on these projects ensures that it is delivered on schedule.
He said the progressive policy direction of this government to transform the country into a gas project is making its mark.
According to Kyari, the three projects commissioned today is in like with the Decade of gas agenda and consistent with the administration’s effort to boost gas supply to domestic market.
Kyari stated further that the projects will also reduce dependency on importation.
He noted that the three infrastructure projects will enable additional gas processing capacity and also increase the supply of Liquefied Petroleum Gas (LPG), thereby reducing the dependency on importation.
Also, he said the projects are fully in line with the Federal Government’s quest to derive value from the Nation’s gas assets while eliminating gas flaring and moving towards environmentally friendly energy sources.
Nigeria, he added, is endowed with significant natural gas resources of over 209TCF of proven gas reserves, with the potential to grow to over 600TCF.
He said, “As a commercial enterprise, these milestone projects present an opportunity to monetize our abundant natural gas resources by expanding access to energy to support economic growth, industrialization, and job creation.
“Your Excellency, Mr. President may kindly wish to note that in order to monetise our gas resources, NNPC is currently executing several major gas infrastructure projects such as the Ajaokuta-Kaduna-Kano pipeline with the associated power plants, the full delivery of the wider OB3 project shortly and also progressing with other initiatives such as Fertilizer and Petrochemical plants, Small and large scale LNG and Floating LNG.
“Currently, NNPC is executing a Compressed Natural Gas (CNG) project aimed at providing a cleaner fuel to power our vehicles as a cheaper alternative to the Premium Motor spirit (PMS).
“We are also pleased to mention that in line with the just announced Presidential directive on the purchase of CNG powered vehicles by institutions of government, and in furtherance of the overall objective of broadening CNG as an alternative fuel for automobiles, NNPC is deploying CNG delivery installations in our retail stations across the country.”
In his speech, the Delta State Governor said that the project will boost the country’s energy supply resources as well as increase the standard of living of the people.
He appreciated key stakeholders in the implementation of this project, adding that this would also reduce the level of poverty within the country.
He said investments in the state were safe and secure as Delta remains a prime destination of choice for investors across the country.
He said that the AHL-GPP2 project was an eloquent testimony to the fact that investments in the state were safe and the state, the first point of call for investors.
He said: “The GPP2 represents a significant leap in our effort to harness the potentials of Nigeria’s natural gas resources, particularly in the energy sector.
“With its capacity to produce high quality gas, this facility stands as a beacon of hope and prosperity for our nation as the clean gas produced in this plant will be transported via the OB3 Gas pipeline, thereby maximising our distribution network towards ensuring efficient delivery of gas to various destinations.
“This event will boost our energy security and also stimulate economic growth, create employment opportunities, and improve the standard of living for our people.
“As we celebrate this great occasion, we must also look towards the future with optimism as the construction of the GPP3 is already underway.
“This represents another testament to the fact that investments in Delta State are safe and the state is the first point of call for investors”.
The Managing Director of AHL, Mohit Barot, said the presence of the president at the inauguration underscores his commitment to foster industrial growth, energy sufficiency, and sustainable growth for Nigeria.
According to him, these gas plants will guarantee renewed hope for Nigeria as the government hopes to be a leader in the global energy sector and boost global market supply.
He said: “I commend the NNPCL and other strategic partners and regulators. Your support as president has been able to boost businesses through policies that support the energy sector.
“You are supporting projects of national importance, and it shows that Nigeria is ready for business. We from the private sector will support your agenda by providing more jobs for Nigerians, and we will continue to ensure environmental sustainability.”
The Seplat MD, Roger Brown, who was represented by Seplat Chairman, Udo Udoma, said the gas plant is an example of what can be achieved between Seplat and NNPC through collaboration.
“Our nation is blessed with natural reserves, and yet our economy and population are hampered by poor energy supply. If all the gas from this plant goes into the power sector, it will transform the lives of over five million people,” he added.
The three critical gas projects will support the federal government’s effort to grow value from the nation’s gas assets while eliminating gas flaring.
Onuba, a chartered accountant, writes from Abuja
