Afrigather Nigeria’s UTM Offshore Ltd. has acquired approval to construct the West African nation’s first-ever floating liquefied pure gasoline facility — 5 years after it was first introduced.
The Nigerian Midstream and Downstream Petroleum Regulatory Authority issued a so-called license-to-construct to the Abuja-based firm for an LNG venture estimated at 2.8 million metric tons per yr.
“This marks a major milestone and aligns with the gasoline growth ambitions of the federal government,” Farouk Ahmed, head of the regulatory company, stated on Friday.
Nigeria, Africa’s largest crude producer, is attempting to pivot away from its reliance on oil by selling funding within the nation’s largely unexploited 200 trillion cubic toes of confirmed gasoline reserves. Many of the nation’s gasoline output is presently both flared or re-injected into wells.
UTM was initially granted a license to construct a 1.2 million tons every year facility in 2019, however it was upgraded to 2.8 million tons “due to elevated LNG demand out there,” Ahmed stated.
2028 Commissioning
The plant, situated in offshore Akwa Ibom state within the oil-rich Niger Delta, is anticipated to be commissioned in 2028, with first-gas a yr later. It’s going to produce LNG, petroleum gasoline and condensate.
The corporate had signed a memorandum of understanding with the African Export-Import Financial institution in 2021 to boost as a lot as $2 billion for the venture, and the financial institution has acquired a first-level approval to take a position $350 million within the venture, stated UTM Chief Govt Officer Julius Rone. A remaining funding choice is anticipated within the final quarter of the yr, he stated.
The corporate had additionally concluded contracts with Japan’s JGC Corp. and Houston-based KBR Inc. to design the venture, with Vitol Group having an off-take settlement for LNG produced on the facility. Final yr, the corporate signed a deal that noticed state-owned Nigerian Nationwide Petroleum Co. Ltd. take a 20% stake within the venture.
UTM had proposed getting feedstock for the venture at an offshore oil discipline that’s operated by Exxon Mobil Corp. in partnership with the NNPC, however that asset is within the technique of being bought to Seplat, which has ambitions of its personal to develop its huge gasoline reserves. Rone stated talks are progressing with to take part within the midstream arm of the venture.
Seplat didn’t instantly reply to request for remark.
“It’s a stranded gasoline that may solely be monetized by means of a floating LNG know-how. It’s going to solely add to Seplat’s steadiness sheet to say they’ve a ready-made purchaser for a gasoline they haven’t developed,” he stated.
