…Adopts contractor financing option for $2.8bn scheme
After several years of traffic gridlocks in several coastal states caused by incessant takeover of highways by petroleum tankers lining up at tank farms to load products due to collapse of petroleum pipelines, the Presidency on Sunday said the nation’s energy landscape will upgrade soon.
This stemmed from a deal for the award of a $2,809,522,548.36 gas pipeline contract approved by the Federal Executive Council as proposed by the Ministry of Petroleum Resources.
The Senior Special Assistant to the President on Media and Publicity, Garba Shehu, disclosed this in a statement made available to journalists in Abuja.
This is also coming barley two weeks after the Vice President Yemi Osinbajo commissioned a private tank farm in Ogun State built by Petrolex Group.
The Trans-Nigeria Gas Pipeline, the East-North network starts from Qua Ibeo Terminal to Cawthorne Channel in Rivers traversing Obigbo-Umuahia-Enugu-Ajaokuta and now Ajaokuta-Abuja-Kaduna-Kano is likely to be completed in 2019.
Shehu said the extension of the network to the East and the North was potentially the precursor of the Trans-African pipeline that will cross the Sahara en route Europe.
He said the contractor financing arrangement has been adopted and the project sponsor, the Nigerian National Petroleum Corporation and the Federal Government are expected to reach common terms with the contractors on how they will be repaid over a 15-year period.
Although the loan repayment is expected from revenue accruing to from both existing and the expanding pipeline network, he said the NNPC and the Federal Government are expected to meet financial gaps and guarantee return on net investment.
The statement quoted the Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, as informing the FEC that the project is for the construction of a 40 inches pipeline across 614 kilometres from Ajaokuta to Abuja-Kaduna-Kano.
“This should mark an important landmark in the implementation of the first phase of the Nigerian Gas Master Plan approved in2018,” Shehu said.
The presidential spokesman added that the second contract approved under what he called “massive, blockbuster investment” is for the engineering, verification, procurement and construction of a 40 inches 30 kilometres Odidi to Warri gas pipeline expansion project.
This, he explained, was meant to transport additional gas supply from upstream producers to various demand points at the cost of N7.7bn and $56m.
The statement averred that “The projects, which can rightly be termed as being among of the President’s pet projects is owed, in part to his vision and momentum back in his days as the federal commissioner for Petroleum Resources.
“That time, Colonel Buhari led think-tanks to plan the country’s gas future and initiated the contracts for the laying of a massive network of petroleum pipelines, linking the length and breadth of the country and laid the foundation for the construction of three refineries, Warri, the second Port Harcourt refinery and the one in Kaduna in a bold move to augment the the supply and distribution of petroleum products in the country.
“That was the golden period of the country’s petroleum industry when domestic refining not only met the requirements of home consumption but also produced excess 150,000 barrels of refined products for export,” the presidency noted.
