Sopuruchi Onwuka
Following the divestment of its shareholders from oil and gas exploration and production joint ventures that traditionally guaranteed its feedgas, the Nigeria Liquefied Natural Gas (NLNG) Limited has begun diversification of feedstock supplies.
Spokesperson, Dr Sophia Horsfall, declared weekend that the company has now engaged multinational oil firms and independent producers in new gas sales and purchase agreements (GSPAs) for sustained rich gas delivery at its liquefaction plants.
Under the new gas sales agreements (GSAs), enhanced feedgas would now flow from SNEPCO-SUNLINK HI project, TEPNG AMNI JV IMA project, NNPCL-First E&P JV, SNG NGML, OANDO- NNPC E&P, and TEPNG JV Ubeta.
The suppliers will, long-term agreements, deliver an estimated 1,290 million standard cubic feet per day (mmscf/d) or 13.3 bcm/yr of feedgas to NLNG.
With options for extension, the gas supply volumes will be gradually scaled up over a period of time.
Oracle Intelligence reports that the new gas supply arrangements address twin concerns about the company’s increasing requirement as it continues to expand liquefaction capacity.
The deals also brings in flexible supply arrangements in the face onslaught by oil thieving vandals on pipelines in the operating environment.
Managing Director and Chief Executive Officer, Philip Mshelbila, said NLNG was now procuring feedgas from diverse third-party suppliers to meet its growing needs for both Liquefied Natural Gas (LNG) and Natural Gas Liquids (NGLs) production.
He said the measure because urgent following recent divestment of onshore assets by several International Oil Companies (IOCs) to non-shareholder entities.
He also pointed out that the operations of the company have in recent years been significantly impacted by pipeline disruptions, including vandalism and sabotage which, he said, affected upstream gas availability.
The new gas supply deals, according to him, are products of sustained efforts by shareholders and stakeholders to address long-standing gas supply constraints.
“NLNG recognises the challenges that the consequent insufficiency of gas supply has caused to its long term buyers, customers, shareholders and more widely to the Nigerian economy. With the new GSAs, NLNG is optimistic of sustainable gas supply for the future and remains grateful for the continuing support of its buyers and other stakeholders, and looks forward to a successful future together.
“We could not have achieved this without the deliberate and concerted efforts of our shareholders and stakeholders in the energy industry in Nigeria. These agreements are a turning point in NLNG’s journey, restoring reliability of supply and ensuring we remain firmly on the path of growth and expansion,” Mshelbila said.
He further explained that the new GSAs mark a historic shift for NLNG, which since inception had relied primarily on legacy shareholder joint venture affiliates for gas supply.
The new deals which also enhance the commercial profile of the six third-party gas suppliers would now support the company’s ongoing expansion drive with significant boost to feedgas availability, enhancing NLNG’s capacity to meet its commercial commitments while laying the groundwork for expansion.
Dr Horsfall stated that new gas supply deals align with the government’s Decade of Gas initiative, which places natural gas at the centre of Nigeria’s industrialization and energy transition agenda.
“NLNG recognises the challenges that the consequent insufficiency of gas supply has caused to its long term buyers, customers, shareholders and more widely to the Nigerian economy. With the new GSAs, NLNG is optimistic of sustainable gas supply for the future and remains grateful for the continuing support of its buyers and other stakeholders, and looks forward to a successful future together.
“We could not have achieved this without the deliberate and concerted efforts of our shareholders and stakeholders in the energy
The landmark GSAs are a game-changer for Nigeria’s gas industry, enhancing local gas production capacity and improving gas supply, which are critical to the country’s energy security, industrialization aspirations, and economic growth.
