By Kunle Adedoyin
Shareholders of the Nigerian Liquefied Natural Gas (NLNG) have taken Final Investment Decision (FID) on its Train7 project, 12 years after the completion of the Train 6 and 20 years after the first train came on stream.
The shareholders of the NLNG: the Federal Government of Nigeria, represented by the Nigerian National Petroleum Corporation (NNPC) with 49 per cent shareholding; Shell with 25.6 per cent; Total Gaz Electricite Holdings, 15 per cent and Eni 10.4 per cent, have kick-started the commencement of the $10 billion LNG expansion project of the company.
Tony Attah, Managing Director/Chief Executive Officer of Nigeria LNG, at the end of the shareholders’ meeting where the decision was reached, disclosed that the project would resuscitate most of the idle fabrication yards across the country and create about 40,000 direct and indirect jobs.
He noted that the Train 7 project, whose construction period after FID would last approximately five years with first Liquefied Natural Gas (LNG) rundown expected in 2024, would grow its production capacity from 22 million tonnes per annum to 30 million tonnes per annum, adding however, that this FID had unblocked the hurdles hindering the actualization of additional trains, up to Train 12, which is the ultimate target.
“There are many hurdles which Train 7 has unblocked, and that is what I mean when I say history is about to repeat itself. The original ambition for NLNG as a company was just Trains 1 and 2, but on the back of Trains 1 and 2 FID, which perhaps took so long, it took 30 years actually, to get to those two trains; but once their FID was taken, we went to Trains 3,4,5, 6,” Attah said.
“I believe that history is repeating itself today and it is worth celebrating that Train 7 has unblocked many hurdles; Train 7 is the gate-opener and I believe that we would go to Trains 8,9,10,11 and 12.”
He added that, “Lots of fabrication yards that have been idle would kick back to life. That is, one of the biggest opportunities that this project brings first and foremost, it is creation of employment, and it then creates additional value for country.
“Today, we have paid more than $7 billion in taxes since we became taxpayers. We have issued more than $15 billion in dividends to government through the shareholdings by the NNPC, which is 49 per cent, and all the other shareholders, Shell, Total, Eni, comfortably enjoy dividends on an annual basis. “Dividends would grow; taxes for Nigeria would grow; employment would grow, and most importantly, we will put Nigeria back on that global map of energy resources country through this project.”
Attah maintained that the Train 7 project was beyond domestic gas for the company, adding that it was a global response to what the global market had been doing in terms of gas.
“In today’s reality, we are lagging behind as a company and as a country. We did a very basic analysis to compare resource to capacity and we just saw that the opportunities for Nigeria have not really started. “We were just 24 months behind Qatar when we started in 1999, but today, Qatar has got 77 million tonnes and we have 22 million tonnes. Train 7 would add another eight million tonnes to take us to 30 million tonnes.
“Just when we thought we were ambitious to go to 30 million tonnes, Qatar wants to add 30 million tonnes to theirs. And that for us is a major reason to wake up to the reality that train 7 is no longer ambitious; not for NLNG, not for Nigeria, but on the back of this project, we expect to see, as the NNPC mentioned, 12,000 direct employment opportunities created by this project; but more importantly, additional indirect employment of more than 20,000.”
Also speaking, Chairman of the NLNG, Mr. Osobonye Longjohn, disclosed that the company would do all it can to see that it build more trains, especially to match its contemporaries.
“If our contemporaries are getting five trains at a go, what stops us from getting seven trains at a go? I want to assure the President and all Nigerians that we would do our utmost to match our contemporaries and we would do it,” he assured.
Mallam Mele Kyari, Group Managing Director of the NNPC, Mallam Mele Kyari, stated that the project when operational, would ultimately deliver at least $20 billion of net revenue to the federation; create at least 10,000 direct jobs and also create 40,000 indirect jobs for the country.
He added that the project was also a reflection of renewed confidence of international investors, particularly our partners, which it have known for long time; stating that their determination to continue investing in the country would help move the country and the relationship with the shareholders forward.
“For us, it is a show of confidence in our country, and not only that, it is also a show of confidence on Mr. President’s determination to put value to this country and to lead the country with example, that would make investors put their money into this country.
“For NNPC, it is our desires met. We are convinced that doing things right and doing things transparently, with accountability to our shareholders, which include about 200 million Nigerians that we know. Doing this serves their interest; doing this brings value on the table; it creates employment, it creates prosperity for this country; and this is what we are known for and what we have promised to follow through.”
The NLNG, had in September 2019, announced that SCD Joint Venture, JV, Consortium, comprising Saipem of Italy, Japan’s Chiyoda and Daewoo of South Korea, has emerged the preferred bidder for its Liquefied Natural Gas, LNG, Train 7 project, and were awarded the contract to undertake the Engineering, Procurement and Construction, EPC, for the Train 7 project.