• Thursday, March 28, 2024
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NLNG Train 7 FID shows Nigeria’s commitment to gas revolution – FG

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The minister of state for Petroleum Resources Timipre Sylva has said the final investment decision taken on NLNG Train 7 is a significant milestone that reinforces the government’s commitment to the acceleration of the gas revolution.

On June 28, 2017, the Federal Government approved National Gas Policy which clearly articulates the policy goals, strategies, and implementation plan of the Federal Government of Nigeria to reposition Nigeria as an attractive gas-based industrialised nation through the prioritization of local gas demand requirements.

The document also indicates that access to infrastructure, a clearly articulated pricing path, and institutional capacity strengthening are required to make gas function as a major driver of the economy.

“As you may recall, the Hon Minister of State for Petroleum Resources has declared the year 2020 as the year of gas. So our Gas focus for Nigeria is on track,” says Justice Derefaka, technical adviser, Gas Business & Policy Implementation to the Minister of State for Petroleum Resources and Program Manager, Nigerian Gas Flare Commercialization Programme (NGFCP).

Derefaka says Train 7 means growth for the Nigerian oil and gas industry as it will ensure guaranteed gas supply in the upstream sector which will open up new development opportunities in the industry.

“As a nation, we have been looking to expand export markets for our more than 200 Tcf of proven gas reserves in a bid to cut reliance on oil revenue already hit by a drop in global prices.

“So for me, taking FID for train 7 will help our aspiration in line with the National Gas Policy for Nigeria to become one of the world’s most important LNG gas hubs and help to leverage our abundant associated gas resources as well as further reducing the gas that would otherwise have been flared.

“We are all elated as this is a good way to end the year because Train 7 is the centerpiece of a growth agenda for the Federal Government,” Derefaka said.

In terms of kick-off of the project, it is expected to start up in 2024 and will lead to an increase in Nigeria’s LNG output capacity by 35% from current levels of 22.5 million mt per year to over 30 million mt per year.

The expansion project is expected to lead to local production of an additional 7.6 million mt per year of which 4.2 million mt will from one new liquefaction train (Train 7), and 3.4 million mt will come from the debottlenecking of existing trains.

From an investor’s point of view, the taking of this FID is an indication that there is renewed hope and confidence of international investors, particularly those Nigeria has been doing business with over the years. And the ministry is putting up robust investor-friendly initiatives to attract more investors into the Nigerian gas sector, Derefaka said.

In terms of revenue drive, the train 7 project is expected to generate $20 billion in net revenue for the government and create 10,000 direct jobs during the construction phase and 40,000 indirect jobs.

“In terms of the next step for the NLNG, I’d say we have a marching from Mr President to begin to look at taking concrete steps for train 12 because the window of opportunity is there.

“In terms of local content, The Project will also support the development of local engineering and fabrication capacity.

“This expansion will ensure that Nigeria, with its significant gas reserves (202 tcf of proven gas reserves, 9th in the world) remains a top, reliable and preferred supplier of LNG in the emerging energy world,” Derefaka said.