ELPS2, OB3, AKK Gas Pipelines Boost Nigeria’s Domestic Footprint – NNPC

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The Group Managing Director, Nigerian National Petroleum Corporation (NNPC), Mallam Mele Kyari has said the national oil company considers as priority the expansion of the corporation’s domestic gas footprint with the delivery of the Trans-Nigeria Pipeline Project, which includes the Escravos to Lagos Pipeline System (ELPS) 2, the Obiafu-Obrikom-Oben (OB3) gas pipeline and the Ajaokuta-Kaduna-Kano (AKK) gas pipeline.

In a statement yesterday in Abuja, the NNPC boss explained that the EPC contract for the 614km AKK gas pipeline project commissioned by President Muhammadu Buhari last Tuesday was awarded at a total contract sum of $2.592 billion to Messrs. Oilserv Plc/China First Highway Engineering Company (Oilserv/CFHEC Consortium) for the first segment covering 303km and Messrs.

The second segment covering 311 kilometers, was awarded Brentex Petroleum Services/China Petroleum Pipeline Bureau (Brentex/CPP Consortium) under a debt-equity financing model with loan from Bank of China and SINOSURE, to be repaid through the pipeline transmission tariff and supported by a sovereign guarantee.

Kyari informed that all the required conditions precedent for closing the debt financing have been provided and the process of obtaining internal approvals by the Lenders is in progress to enable financing close by August 2020.

He disclosed that as part of the agreement, NNPC is utilizing the equity contribution to commence execution of the project to recover lost time and put the project back on track.

The NNPC boss expressed confidence in the ability of the EPC contractors to deliver the project on time, within budget and to specifications, noting that upon completion, the project would enable the injection of 2.2bscf/d of gas into the domestic market and facilitate additional power generation capacity of 3,600MW.

Kyari remarked that the delivery of the 614km Ajaokuta-Kaduna-Kano (AKK) Gas Pipeline project, and commissioning by President Muhammadu Buhari last Tuesday would not have been possible without the full and unflinching support of the President himself.

He commended the President for making it a priority to ensure that revenues from oil and gas resources are utilised to support the emergence and growth of other non-oil sectors of the economy.

In the same vein, Kyari said that the national oil company was transitioning towards becoming an integrated energy company to support Buhari’s economic diversification efforts.

In his remarks, Governor of Kogi State, Alhaji Yahaya Bello, who expressed gratitude to God for witnessing the flag-off of the construction phase of the AKK project, said his administration has sponsored many youths in the state to acquire skills in welding and urged the contractors to gainfully engage them.

On his part, Governor of Kaduna State, Mallam Nasir el-Rufai, thanked the NNPC, Ministry of Petroleum Resources, and other stakeholders for ensuring the flag-off of the project, stressing that there was high hope because of the enormous benefits the project would bring to the state.

It will be recalled that while commissioning the project, President Buhari had called on the governors of Kogi, Niger, Kaduna and Kano states, as well as the Minister of the Federal Capital Territory (FCT) to provide the enabling environment and support for the project.

Chibisi Ohakah, Abuja


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