NLNG signs SPAs with 3 gas off-takers to distribute 1.1tons of gas locally
The Nigeria LNG Limited has signed Sales and Purchase Agreements (SPAs) with three off takers with the aim of supplying 1.1 million tonnes of Liquefied Natural Gas, LNG annually to the domestic market. The announcement was made by Tony Attah, Managing Director and Chief Executive Officers, NLNG, at an event held at Transcorp Hilton, Abuja, on Tuesday.
The SPAs with Asiko Power Limited, Bridport Energy Limited and Gas-Plus Synergy Limited are part of a first wave of agreements targeted to boost gas supply to power, industries, and domestic use.
According to Attah, “ The agreement signing will go down in history as another concrete step that we have taken as Nigeria LNG Limited to support the Federal Government’s Decade of Gas initiative.
“This is another clear testament of how we continue to live our vision of being a global LNG company helping to build a better Nigeria. Nigeria LNG is respected internationally because of its solid reputation as a responsible, trusted and reliable supplier of Liquefied Natural Gas.
“ Locally, we are distinguished as a development partner with Nigeria’s Government, with our six-train plant generating more than US$110 billion in revenue since it began operation in 1999.
He noted that the Nigeria LNG has paid about US$18 billion as dividends to the Federal Government of Nigeria, through the state-owned Nigerian National Petroleum Corporation (NNPC). A sum of 49% shareholding and equivalent amount has been released as dividend to the other three shareholders in the same time period.
He further stated that NLNG has also paid about US$15 billion for feed gas purchases to the Federal Government of Nigeria through its shareholding in NNPC and about USD 9 billion in taxes.
The NLNG MD said, the firm remains a major influencer in the domestic LPG sector, adding that NLNG has dedicated 450ktpa of LPG to the market.
He said, “Our focus is to support the use of cleaner energy to protect our citizens and the environment from the hazards posed by other cooking fuels by encouraging the use of cooking gas in Nigeria.
“I am pleased to announce that our commitment, as a corporate entity, to unlocking gas utilization is now backed by the execution of Sales and Purchase Agreements (SPAs) to supply 1.1 Million Tonnes Per Annum (MTPA) of LNG on DES basis to Asiko Power Limited, Brid port Energy Limited and Gas-Plus Synergy Limited.
“The SPAs will facilitate the project execution and development of infrastructure led by off-takers to aid LNG delivery into the domestic market. 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.
“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.
The NLNG boss noted that as part of his company’s domestic LNG Scheme, its ongoing Train 7 project will attract about $10bn in foreign direct investment. He also noted that NLNG is also looking to expand the LPG value chain by increasing its supply to the domestic market, guaranteeing LPG supply and enhancing its affordability, and enabling the development of a value network for a sustainable ecosystem.
The representatives of the three off-takers, after signing the agreement disclosed that new initiative would revolutionize the gas supply market in the country.