The Nigerian National Petroleum Company (NNPC) Limited and the Chinese company Wison Heavy Industry Co. Ltd have inked a memorandum of understanding (MoU) for the development of a floating LNG project in Nigeria.
The agreement was inked during the ongoing United Nations climate change conference (COP28) by NNPC and Wison Heavy Industry.
Olufemi Soneye, the NNPC’s chief corporate communications officer, revealed this in a statement on Wednesday.
Soneye said the floating LNG MoU was signed by Olalekan Ogunleye, executive vice president, gas, power and new energy, on behalf of NNPC and Kai Xu, managing director of Wison Heavy.
In the statement, both parties agreed to work together to chart a roadmap for the project development that will lead to an investment decision.
NNPC said the LNG project will target the international market.
Also, Soneye said a supply, installation and commissioning agreement was signed by NNPC Prime LNG Limited, an arm of NNPC Trading Limited, and SDP Services, an independent oil and gas company, for a 421 tonnes per day LNG project targeting the domestic LNG market.
The small-scale LNG (SSLNG) project agreement was signed by Lawal Sade, the managing director, NNPC Trading Limited, on behalf of NNPC Prime LNG. and Abhinav Modi, managing director of SDP Services.
He said the SSLNG project will ensure the efficient supply of LNG to the autogas and compressed natural gas (CNG) and industrial as well as commercial customers nationwide.
The LNG project, which will be located at Ajaokuta in Kogi state, is expected to be operational by December 2024.
After the signing ceremony, Ogunleye said NNPC is committed to delivering gas to industries nationwide and accelerating the company’s gas commercialisation efforts through the floating LNG project.
Ogunleye said: “We see both projects as having enormous impact all over the country because they are central to the commercialisation of Nigeria’s abundant gas resources and ensuring that our country earns the much-needed foreign revenue from its abundant gas assets.”
“It is also consistent with NNPC Management’s drive to deliver on Mr. President’s gas and power aspirations across the country.”
Speaking on the SSLNG project, Sade said it will boost the domestication of LNG utilisation by supporting the growth of auto-gas initiatives across the country.
“We are looking at a timeframe of 12 months from execution to the commissioning of the project. The project will deliver about 420 tonnes per day of LNG per day into the domestic market, which will enhance efficient delivery of gas to the auto-gas/CNG and industrial customers in line with Presidential mandate,” she said.
The partners, according to Soneye, have pledged to work with NNPC to deliver the projects within schedule and in the most cost-effective manner.
