Nigerian National Petroleum Company (NNPCL) and its joint venture partners including Shell Petroleum Development Company, TotalEnergies, and Agip (SPDC), have finalised a landmark agreement to supply gas to a $3.3 billion methanol plant being developed by Brass Fertiliser & Petrochemical Company Ltd.
The signing of a Gas Sales and Purchase Agreement (GSPA), in Abuja yesterday, which was supervised by the minister of state for petroleum resources (Gas), Ekperikpe Ekpo, came nine years after the project was announced.
This agreement paves the way for the Brass Fertiliser and Petrochemical Company Limited (BFPCL) and its partners to achieve financial closure for the Brass Fertiliser and Methanol Project.
The JV partners, comprising NNPCL, SPDC, TotalEnergies Ltd, and Eni, will supply 270 million standard cubic feet of gas per day (270MMscfd) to BFPCL, the largest single GSPA to any domestic gas offtaker in Nigeria.
This project is expected to generate over $1.5 billion annually from exports of fertilizers, petrochemicals, and other gas-based products.
Ekpo said that “Achieving this GSPA showcases Nigeria’s business-friendly environment and the government’s commitment to investor-friendly policies.”
The gas minister urged all parties to maintain their steadfastness, expecting BFPCL and its partners to achieve financial closure and commence construction soon to “bring in much needed Foreign Direct Investment (FDI) and create thousands of jobs for our teeming population, while changing the face and fortunes of the host Bayelsa State and community for good.”
Also speaking, permanent secretary, Ministry of Petroleum Resources, Nicholas Ella Agbo described the GSPA as a significant milestone in monetizing Nigeria’s vast gas reserves, currently over 209 trillion cubic feet.
“The project will reduce fertilizer imports by 30 per cent, saving Nigeria approximately $200 million in foreign exchange annually, and contribute around $600 million annually to Nigeria’s GDP and create over 5,000 direct jobs and 35,000 indirect jobs significantly improving the livelihoods of many Nigerians, particularly in the Niger Delta region,” he said.
NNPC’s representative, executive vice president, Upstream Oritsemeyiwa Eyesan, commended the collaboration and expressed optimism for the project’s future, saying, “This signing marks the beginning of a new chapter in Nigeria’s journey towards a gas-powered economy.”
She said with the GSPA, one of the vital boxes has been ticked to progress with a 10,000 tons methanol plant in Nigeria.
The managing director of BFPCL, Dr. Ben Okoye, lauded President Tinubu and Ekpo for their roles in finalising the GSPA. Okoye emphasised the need to unlock Nigeria’s gas deposits promptly, citing the urgency to utilise gas before it becomes less relevant.
Bayelsa State governor, Sen. Douye Diri, welcomed the project, highlighting its potential to generate employment opportunities for the state’s youths and Nigeria at large.
Represented by Commissioner for Trade, Industry and Investment, Dr. Ebieri Jones, the governor invited prospective investors to tap into Bayelsa’s vast potential and peaceful disposition, dubbing it “investment heaven” for investors.
Coordinating director of the Decade of Gas Secretariat, Ed Ubong, said with the signing of this Gas Sale Agreement (GSA), Nigeria now has access to over one billion cubic feet of gas per day this year alone. This includes, according to him, contributions from the Seplat facility, the SPDC Joint Venture, and the TotalEnergies Ubeta project.
We expect two more sources to come online soon, and I’m confident we’ll surpass four billion cubic feet before the year ends. I’m particularly excited about the upcoming OB3 project, which we’ll celebrate upon completion,” Ubong said.
Other speakers including managing director of SPDC, Osagie Okunbor; executive director, Strategy and Business, TotalEnergies, Abiodun Afolabi; as well as vice chairman/managing director Eni, Fabrizio Bolondi, lauded Ekpo, for his pivotal role in breaking the impasse that delayed the GSPA signing since 2015. They expressed delight and gratitude for Ekpo’s leadership and dedication, which ensured the deal’s success.
The JV partners also reaffirmed their commitment to the project’s success, underscoring the importance of collaboration and effective stakeholder engagement to unlock Nigeria’s vast gas potential.
