The Nigerian National Petroleum Corporation, Total Exploration and Production Nigeria Joint Venture and Greenville Oil and Gas Limited, as well as the Gas Aggregation Company of Nigeria Limited, on Tuesday agreed to execute a N259bn gas sale and aggregation agreement.
Chief executive officers and senior management officials of the four companies signed the execution agreement in the presence of the Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, and pledged to ensure that the project was successfully implemented in Nigeria.
The execution of the agreement will usher in the era of virtual pipelines in Nigeria where gas-propelled trucks will be used to move Liquefied Natural Gas across the country, as being done by petrol tankers.
Parties to the agreement explained that the virtual pipeline system was coming at a time when the traditional pipeline system had become endangered due to incessant pipeline vandalism and other daunting challenges being faced in the country.
Greenville will transport the products with specialised LNG trucks, which have the capacity to travel about 1,000km on the LNG before refuelling, according to the agreement.
LNG is said to be lighter, cheaper and safer when compared to diesel and petrol and will have less impact on Nigerian roads during its transportation to the locations of various customers.
The Chairman, Greenville LNG, Mr. Eddy Van Den Broeke, told journalists on the sidelines of the event that his firm decided to invest in the first three mini LNG plants in Africa, adding that “the big challenge today is that no bank is available to finance this investment because of the temporary problems that Nigeria is going through.”
He also said, “This agreement will allow Nigeria to get back to a stronger financial position. Our project is done with Total Gas, and local gas is coming from Obite (in Rivers State). That means no need for foreign exchange.
“The investment is around $500m (N153bn, at the official exchange rate of N305 per dollar) in the first phase, and we will go up to about $850m (N259bn), and this is completely on equity without any bank financing up till now.
“We hope that in the second phase, as the minister has said today, more assistance will be given once the people see the investment. And once the product come to the market, automatically there will be confidence and we have to build the confidence.”