The first Floating Liquefied Natural Gas (FLNG) plant in Nigeria is set to open after a historic shareholders agreement was signed by the Delta State Government, Nigerian National Petroleum Company Limited (NNPC), and UTM Offshore Limited on December 19, 2023. The signing ceremony, which took place at the NNPC Towers in Abuja, represented an important step forward in the country’s quest of indigenous capabilities in the energy industry.
The signing of the agreement was attended by key representatives, with the Secretary to the State Government, Dr Kingsley Emu, and Solicitor General and Permanent Secretary, Ministry of Justice, Mr Omamuzo Erebe, signing on behalf of the Delta State Government. On the side of NNPC Limited, the Group Chief Executive Officer, Mr. Mele Kyari, and for UTM Offshore, the Group Managing Director, Julius Rone, put pen to paper.
Under the terms of the agreement, the Delta State Government will hold an eight percent share, NNPC Limited 20 percent, and UTM Offshore 72 percent in the pioneering FLNG project.
Delta State Governor, Sheriff Oborevwori, expressed the significance of the UTM FLNG Project, highlighting its status as the first of its kind developed by an indigenous private company in Nigeria. Governor Oborevwori emphasized the strategic importance of the project to the national economy and stressed that Delta State’s 8% equity investment was motivated by the state’s conviction of the project’s value.
With 40% of Nigeria’s proven gas reserves located in Delta, the governor deemed the investment as both strategic and economically impactful. He highlighted the expected production of over 300,000 metric tonnes of LPG (cooking gas) dedicated to the domestic market, reducing environmental hazards in the Niger Delta by minimizing gas flaring. Additionally, Governor Oborevwori underscored the potential benefits for job creation, environmental sustainability, and improvements in public health.
The signing ceremony was an occasion for commendations and appreciation, with Governor Oborevwori acknowledging the foresight of the immediate past governor, Senator Ifeanyi Okowa, and expressing gratitude to various stakeholders and collaborators, including regulators and Afreximbank for financing arrangements.
Mele Kyari, the Group CEO of NNPC, praised Governor Oborevwori for his commitment to gas development and investment in gas projects. He emphasized the collaboration between NNPC and the Delta State Government, recognizing the state’s dual role as a supporter and investor in the critical gas sector.
The Minister of State, Petroleum Resources, Ekprikpe Ekpo, echoed the importance of monetizing the country’s vast gas reserves for economic development. Julius Rone, the Group Managing Director of UTM, described the signing ceremony as a significant milestone in actualizing Nigeria’s first indigenous FLNG. Rone expressed gratitude to the Delta State Government for taking equity in the project and anticipated the Final Investment Decision in the first quarter of 2024.
