NLNG Loses $10bn Due To Project Delays
The project which was to have been completed about four years ago was capable of earning the nation about $2.5 billion per annum and drastically reducing the level of gas flaring in the Niger Delta.
This was disclosed in Bonny, Rivers state yesterday, by the management of the company, during the inauguration of NLNG’s 3,000th cargo which was scheduled to leave for Turkey.
Making a presentation during the inauguration, Joseph Alagoa manager,technical services, who represented Babs Omotowa,managing director of NLNG, stated that the contractual agreement entered into with those that intend to buy the product from Train 7 had been extended by one year.
On the company’s strategy to mitigate the effects of Shale gas and other major gas discoveries in Africa, Alagoa explained that the company has repositioned itself to meet these challenges in order to maintain a fair share of the world market of LNG.
He said the company which is one of the leading suppliers of LNG in the world has taken proactive steps by moving from Europe, its traditional market, to other places like Asia.
He admitted that Shale gas is global but added that the demand for LNG still outstripped supply in the world market today.
Alagoa said the company has now found markets in China , Japan Malasyia and even India, where the product is also in high demand.He said Japan which now controls 22 per cent of world demand of LNG is major customer of the NLNG, following the nuclear power plant accident of the 2012. This is followed by Europe which mostly uses the product for its power plants and industries.
The company also explained that it is selling Liquefied Petroleum Gas(LPG) otherwise known as cooking gas to local companies at the international prices, to offset its transportation and other logistics costs.
With a networth of more than $24 billion, Nigeria LNG Limited remains the single biggest private sector investment in Sub-Saharan Africa.
“We are proud to note that the investment, since the commencement of full operations in 1999, generated over $53 billion dollars to its shareholders within the first ten years. The Federal Government also earned more than $9 billion as dividends during the period”, he said.
Alagos said that before the commencement of operations, 75 percent of the 2.6 billion cubic feet of associated gas produced by oil companies operating in Nigeria was flared. This trend, he said has changed, as NLNG Limited currently converts over four trillion cubic feet of associated gas to liquefied natural gas (LNG) and natural gas liquids (NGLs) for export and domestic uses.
He said that in doing this, the company has positively impacted on the country’s gas flaring status, helping to improve the environment, whilst converting a previously wasted resource into wealth for the nation.
He said yesterday’s 3000th LNG cargo would be delivered on January 19, 2014, to BOTAS in Turkey, by one of its vessels, the LNG Lokoja. “We believe it must not go un-noticed that this vessel is manned by a workforce which is about 95% Nigerian, in line with our aggressive pursuit of technology transfer and our Nigerianisation policy”.
He added that part of the next phase of the company’s growth programme would be the addition of a seventh train to the existing sixth train NLNG infrastructure. When achieved, this will enable NLNG add some eight million metric tonnes to its current production capacity, and increase annual output to 30 million metric tonnes.