The Managing Director and Chief Executive Officer of Nigeria Liquefied Natural Gas Limited, Mr. Tony Attah, has revealed before the Senate Committee on Gas that the proposed amendment of the NLNG Act by the House of Representatives would discourage investments that could help build a better Nigeria.
According to him, the review if not well intended will further squeeze away profitability in the sector.
Addressing the Committee led by its Chairman, Senator Bassey Albert Akpan, when they paid an oversight at the Bonny Island plant of the company in Rivers State, Attah told the visiting senators that the NLNG’s profitable business model was made possible by the NLNG Act, which is currently being threatened by a proposed amendment by the National Assembly.
A release issued by the company’s General Manager, External Relations, Dr. Kudo Eresia-Eke, said “the NLNG boss informed the lawmakers that the company’s incorporated joint venture (IJV) model granted it the capacity and autonomy to successfully approach the international capital market to source funds”.
Attah stated that the model contrasts with the less flexible upstream unincorporated JVs, which are directly funded by the shareholders.
Continuing, he stressed that the proposed amendment would have adverse implications for NLNG’s ability to continue its business profitably.
In his submission, “NLNG needs all the necessary support to be able to go to the market to raise $15 billion for Train 7 investment which is capable of generating 18,000 jobs. This will enable Nigeria resolve most of the youth restiveness in the country; help the company to remain a global player in the natural gas market, and to help build a better Nigeria. We believe we can achieve all these with your help”.
He therefore argued that Nigeria LNG is faced with severe challenges, including operations of multiple regulatory agencies, and pipeline security issues, citing 19 recorded pipeline disruptions this year alone as example.
Besides, he also alluded to the problem of double taxation, which is capable of impacting the company’s competitiveness and compromising its ability to maintain its position as the world’s fourth largest gas supplier.
Attah noted that the situation if not checked, is capable of leading to a number of unfavourable consequences such as loss of revenue for the federal government, potential loss of jobs and loss of status as inspirational business model and number one indigenous company in the country.
The Chairman of the committee, Senator Akpan, promised that his committee would do all in its powers to sustain the NLNG legacy and encourage the entrenchment of the NLNG business model in other parts of the Nigerian economy.
He said “I am particularly happy with what I have seen and heard today, and I will be glad to have your comprehensive presentation slide to share with other members of the upper legislative chamber to get them better informed. The senate resisted calls for the sale of government equity in Nigeria LNG because we believe that Nigeria LNG is the most successful Oil and Gas venture in the country”.
He added that a business like NLNG, which had succeeded over the decades, should be encouraged, and assured that the company has the Senators’ buy-in on the proposed Train seven expansion programme which will potentially add an estimated 18,000 new jobs.
