Gas: Nigeria partners Shell in US$1.5 bn gas processing plant
LAGOS-The National Petroleum Investment Management Services has concluded arrangement to meet with the management of Shell Nigeria over the proposal by Drake Nigeria Limited and its partners to facilitate a $1.5billionn (N150.75billion) gas processing /methanol facility plant.
This was arrived at in Lagos after a presentation to the managements of NAPIMS and that of the Department of Petroleum Resources by representatives of the oil firms driving the project.
The project, which is to be handled in partnership with foreign oil companies, is at the verge of taking off as all parties to the deal have endorsed the necessary documents.
A party to the arrangement and Chairman, Drake Oil Limited, Chief Sam Dede, said the plant was expected to utilise gas from the development of gas fields in OML 11, 13 and 17.
He said after the meeting with Shell officials, NAPIMS would invite Drake Oil and other partners to reach an agreement for proper take off, adding that the project was in support of the proposed gas revolution by the Federal Government.
Other firms involved in the project are Gail/ITS India Limited, GE Petrol of Equatorial Guinea, Rocket Group Nigeria/Canada, and SK Engineering and Construction Group of South Korea.
Last month, Drake Oil signed a Memorandum of Understanding for an investment of $5.5bn in Nigeria’s oil, gas and power sector with SK Engineering and Construction Group.
The agreement was sealed to effectively activate a concessionary agreement to build a Liquefied Natural Gas plant with a capacity of about 30,000 metric tonnes per day in Oguta, Imo State, within the next few months.
Drake had earlier signed an agreement to this effect with the Federal Government via the Ministry of Petroleum Resources.
Other agreements which are equally expected to be activated for implementation by the MoU include projects on gas flaring control, soil and water remediation in the Niger Delta, power generation and distribution as well as a definitive gas processing plant, otherwise known as gas-to-liquid project which will be sited in Rivers State.
Dede explained that the MoU signalled an actual commencement of the projects which where expected to be completed within the various time lines as specified in the terms of agreement.
He stated that the design of the gas-to-liquid project was envisaged to be bigger than any refinery in Nigeria and would take between three and four years to be completed and commissioned for operation.
He said, “Totally, we are talking about $5bn for the gas-to-liquid project which will be bigger than any refinery in Nigeria and will take between three (and) four years to be completed. The LPG which we are about to start will take a maximum duration of one year and will consume about $500m. They will be located in Oguta in Imo and Rivers states respectively due to the availability of gas feedstock in the region.”
“As we speak now, Drake has about 500,000 cubic feet of gas allocated to it by the Federal government, you are aware that we have been in the forefront of stopping gas flaring in Nigeria and that is contained in our MoU with the Nigerian National Petroleum Corporation, which we signed in 1994 which we have been working on together to achieve.”