Nigeria Liquefied Natural Gas Limited, (NLNG) has signed Sales and Purchase Agreements, (SPAs) with three local companies to deliver 1.1 million tonnes of liquefied natural gas annually to the domestic market.
The deals with Asiko Power Limited, Bridport Energy Limited and Gas-Plus Synergy Limited are expected to boost gas supply to power, industries and for domestic use.
Managing Director of NLNG, Mr. Tony Attah who spoke at the event in Abuja said the SPAs will facilitate the project execution and development of infrastructure led by off-takers to aid LNG delivery into the domestic market.
He described LNG as a virtual gas pipeline which will deliver gas to all parts of Nigeria.
He noted that NLNG since its inception in 1999 has generated over $110 billion in revenue and has paid about $18 billion in dividends to its shareholders including Nigeria through the NNPC.
He explained that “the execution of these SPAs follows a Domestic LNG, DLNG, workshop which was held in November 2019 to stress test the delivery model with industry stakeholders and a series of engagements to identify suitable actors to co-create the initiative and stimulate market interest for potential off-takers”.
He pointed out that “with Nigeria’s enormous gas reserves, I am not in doubt that with the right drive from the government and the support of corporate organizations, we as a nation can stand with our head held high to be counted among major players. The government has demonstrated its readiness to take the gas sector to the next level by declaring this decade our nation’s Decade of Gas.
“We believe this will be the decade for us to leverage on our gas reserves to accelerate our power generation solutions through Gas-to-Power projects. It will be the decade when as a nation we stop reporting deaths from pollution through the use of wood and solid fuels as domestic energy sources. And it will be the decade for empowering local SMEs to take advantage of the various investment opportunities that the Decade of Gas will attract”, he added.
Speaking on pricing challenge in the domestic gas sector, he said: “This is not a subsidy scheme. It is purely a commercial deal between a willing seller and a willing buyer. I am looking for who will pay me the highest price”.
Mr. Attah noted that agreements would create a lot of job opportunities due the construction of infrastructure required to deliver LNG across the country
“Nigerians will feel the impact immediately, just signing this SPA has already opened the door for them to be able to find financing, they will be funded at the back of the SPA but beyond that, once they start their projects, massive opportunities already will show up in terms of employment.
“You know what we are grappling with is really around poverty and unemployment and for these SPA’s will come a lot of employment because they have to build a lot of infrastructure but on top of that there will be huge capacity development consistent with the Nigeria content development Act. This is massive opportunity for Nigeria and Nigerians”.
Speaking at the event also, NNPC COO Gas & Power, Yusuf Usman urged the local companies not the export the LNG as it was strictly meant for domestic market.
Also speaking at the event, the Managing Director of Asiko Power Limited, Mr. Felix Okundayo observed that though the deal took long in the making, it would revolutionize gas supply market in the country.