• Thu. Jun 8th, 2023

    Why Nigeria LNG trains producing at about 70% of installed capacity

    ByBassey Udo

    Apr 4, 2022

    L-R: Deputy Head of Mission Italian Embassy, Tarek Chazli, with Minister of State Petroleum Resources, Timipre Sylva and Italian Ambassador to Nigeria, Stefano De Leo, in Abuja, on Monday

    By Bassey Udo

    The Nigeria LNG is currently facing serious challenges meeting its domestic and international gas supply obligations due to inadequate gas, the Minister of State for Petroleum Resources, Timipre Sylva, said on Monday.

    The inadequate gas situation, which has seen the plant operating at below installed capacity, Minister said, followed the refusal of the multinational joint venture partners in the NLNG project to allow the transportation of third-parties’ gas through their shared gas pipelines to the plant.

    To help the NLNG have sufficient gas to meet its contractual obligations, Sylva said the Federal Government appealed to the JV partners in the NLNG project to relax their rules and allow the transportation of third-parties’ gas through their facilities, to boost the gas supply capacity to the plant.

    The JV partners in the NLNG project include the Nigerian National Petroleum Corporation (NNPC) (49%), Shell Gas B.V. (25.6%), TotalEnegies Gaz & Electricité Holdings (15%), and Eni International N.A. N.V. S. àr.(10.4%).

    But the Minister said the decision by the partners not to allow third party operators to transport gas through their pipelines to the NLNG Trains was negatively impacting the operations of the plant at full installed capacity.

    The situation, the Minister noted, has seriously destabilised normal operations at the plant, particularly its inability to meet both the domestic and international gas obligations.

    “The NLNG is at present only able to produce at about 70 percent of installed capacity,” he said.

    Speaking during an audience with the new Italian Ambassador to Nigeria, Sefano De Leo, in Abuja, on Monday, the Minister said if the partners relaxed their rules to allow third parties’ gas supply to the NLNG, the company would be able to supply gas to help ease European Union’s current gas crisis.

    “The issue we have with the existing NLNG Trains is that of insufficient gas supply. The partners are running out of gas, and they are refusing third parties to supply gas to the NLNG Trains. “The partners are insisting that they can only allow third parties to supply gas to the plant only if they would agree to supply at subsidized rates.

    “These people, of course, want to make money, and they cannot supply at subsidized rates. That’s why the NLNG Trains cannot produce at full capacity. The partners can afford to supply at subsidized rates, because they are partners in the NLNG project, not the third parties. This is a very critical issue I want to discus with the respective partners to see how we can resolve this problem, so that we can increase the production capacity of the NLNG,” Sylva said.

    The minister acknowledged the long-standing relations between Nigeria and Italy, adding that the Federal Government was also seeking the cooperation of the Italian government in providing support for night helicopter rescue operations in the country.

    At the moment, he said helicopters cannot fly in the night in Nigeria, thus foreclosing any rescue operations at night.

    “For us in Nigeria, this is a very important matter. We want to develop a 24 hours economy. We want a situation where helicopters can fly 24 hours in Nigeria,” he said.

    The new Italian Ambassador, De Leo, underscored the importance of Nigeria in Africa, noting that as the continent’s most populous country, it would be difficult for anyone to ignore the country, both at the political and economic fronts.

    “At the moment, the EU wants to diversify its energy sources, especially gas supply, and Nigeria is very strategic to us. We have been long-standing friends and partners and one of the most important ones for that matter. So, we need to continue to dialogue on how things can be done properly.

    In Africa, no country was more strategic than Nigeria, because of its large population, economy and political position. So, we are happy to work with you,” the Ambassador said further.

    Leave a Reply

    Your email address will not be published. Required fields are marked *