The Nigerian National Petroleum Company (NNPC) Ltd., in collaboration with UTM Offshore, an indigenous firm, and the Delta State Government, has officially signed a Shareholders Agreement (SHA) aimed at spearheading a groundbreaking initiative to leverage Nigeria’s abundant gas resources. The focus of this strategic alliance is to revolutionize the nation’s power and industrial sectors through the development of the first Floating Liquefied Natural Gas (FLNG) facility in the country.
According to Chief Corporate Communications Officer NNPC Ltd. Abuja Olufemi O. Soneye, the signing ceremony, held at the NNPC Towers in Abuja on Tuesday, was attended by key stakeholders, including the Group Chief Executive Officer of NNPC Ltd., Mr. Mele Kyari, the Group Managing Director of UTM Offshore Limited, Mr. Julius Rone, and the Governor of Delta State, Rt. Hon. Sheriff Oborevwori.
During the event, Mr. Kyari emphasized the transformative impact of harnessing gas resources, stating, “In the next 2-3 years, we will use gas to bring about a revolution in our country.” He highlighted the commitment to not only export gas but also prioritize initiatives to bring gas into the domestic market. Mr. Kyari underscored the readiness of the infrastructure to support this vision, predicting significant positive impacts on the power sector, gas-based industries, and ancillary economic activities.
Addressing the significance of the FLNG project, Mr. Kyari affirmed that Nigeria’s extensive gas resources have been underutilized, and the current focus is on monetizing these resources for the benefit of the nation and the global community. He emphasized the project’s alignment with the Federal Government’s Decade of Gas Initiative and the goal of establishing Nigeria as a gas hub.
Expressing NNPC Ltd.’s dedication to the FLNG project, Mr. Kyari highlighted the uniqueness of the initiative, stating, “This is the first of its kind that the company is taking keen interest in and holding equity in.” He further revealed ongoing efforts to promote several Floating LNGs, including fixed LNG projects, in collaboration with partners like the Delta State Government.
In his remarks, Mr. Julius Rone of UTM Offshore praised the SHA execution as a significant milestone toward actualizing Nigeria’s first indigenous FLNG. He commended President Bola Tinubu for his commitment to developing the nation’s gas resources and recognized Mr. Kyari’s leadership in ensuring the project aligns with the provisions of the Petroleum Industry Act (PIA) 2021.
Governor Sheriff Oborevwori of Delta State, expressing the state’s commitment, highlighted that the Delta State Government, possessing 40% of Nigeria’s proven gas reserves, chose to take an 8% equity stake due to the strategic importance of the project to the national economy. He outlined the potential positive impacts of the FLNG project, including the production of over 300,000 metric tonnes of LPG for the domestic market, environmental hazard mitigation, job creation, and the transition to cleaner energy.
Witnessing the SHA execution, the Honourable Minister of State for Petroleum Resources (Gas), Rt. Hon. Ekperikpe Ekpo, emphasized the FLNG’s role in monetizing Nigeria’s gas resources to drive the economy and achieve energy security.
The FLNG facility, anticipated to produce 1.81 to 2.72 metric tonnes per annum (mtpa) of gas, will see NNPC Ltd., UTM Offshore, and the Delta State Government holding 20%, 72%, and 8% stakes, respectively. The project is poised to contribute significantly to Nigeria’s economic growth, energy security, and environmental sustainability.
