NNPCL Seals Deal To Reduce Price Of Cooking Gas

The Nigerian National Petroleum Company (NNPC) Limited and UTM Offshore Limited are collaborating to make cooking gas more accessible and affordable for consumers.

Both companies signed a Heads of Terms Agreement, establishing NNPC’s 20% equity in the UTM FLNG Project.

The signing, held at NNPC’s headquarters in Abuja, signifies UTM Offshore Limited’s commitment to stabilize cooking gas prices and increase its accessibility, according to the company’s group managing director, Mr Julius Rone.

He underscored the advantages, including environmental benefits, investment opportunities, and a substantial increase in employment.

The Final Investment Decision (FID) is projected for the end of 2023, with the project’s launch set for the fourth quarter of 2026. Once complete, the project is expected to produce 1.7mmtpa of LNG and 300,000 metric tons of LPG (cooking gas) entirely for domestic use.

It is anticipated to directly employ 3,000 Nigerians and indirectly create jobs for an additional 4,000 people. The cooking gas produced will lower prices, improve socioeconomic conditions, and decrease deforestation and gas flaring, thus reducing carbon emissions.

Prominent engineering firms – JGC of Japan and Technip of France, backed by KBR as the Owners Engineer, will construct the facility, situated about 60km offshore at a depth of 64m.

He said, “Today is a great day for Nigeria. For us at UTM, we are very delighted that NNPCL has considered this project worthy enough to invest in and to partner with UTM to deliver Nigeria’s first floating LNG.

“This is a major landmark achievement for an indigenous company to partner with one of the world’s best energy conglomerates which is NNPCL.

“We are very proud to work with NNPCL to deliver this first floating LNG. We believe that with NNPCL on board this project, by the special grace of God, we will deliver the first floating energy by December 2026 just as we promised Mr. President.

“Our aim is to complete the FEED towards the end of October 2023, and hopefully start work on the Open Book Estimate, OBE, for the EPC contract in November 2023.

“It is worthy of note that this is the first indigenous company to embark on such a project and by the grace of God, we will succeed together with all our partners who have been working with us on this project since 2019

“It is in light of this that we appreciate the group chief executive officer of NNPCL, Mr Mele Kyari and his management team for demonstrating the uncommon zeal, patriotism and belief in UTM by staking their own commitment to the project. It says a lot about what we are doing and the direction we are headed. I can assure you that in no distant time, Nigerians will start reaping the benefits of the project.”

The chief executive officer of NNPCL, Mele Kyari, while speaking on the deal noted that the NNPCL is committed to the project saying it is a project of utmost importance to the nation that must be supported to succeed at all cost.

Kyari said, “No matter the amount of reserves you have underground, if you haven’t brought it up to the surface, you have done nothing. This is why we are very interested in this project and we are going to do our own part to ensure its success. Be assured that NNPCL is solidly behind this project.”