Brass LNG Project gulped$1.2bn Not $22bn – NNPC   

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NNPC

Conoco Philips, whose investment value was $192 million received only one dollar as entitlement after pulling out of the Brass LNG project

CONTRARY to speculation that the Brass LNG has gulped $22 billion, the Nigerian National Petroleum Corporation, NNPC, has confirmed that the actual historical amount spent on the project from inception till date was about $1.2 billion.
Ahmed Dikko, general manager, New LNG Venture of the NNPC, on Wednesday at the House of Representatives Ad-hoc Committee investigating the expenditure and implementation of the $22 billion Brass LNG project,  said that the $1.2 billion was about the total money spent so far by the various shareholders to get the project to its current stage.

“This sum included the cost of acquiring project land, which covers approximately 606 hectres, cost of early works contract, Front End Engineering Design (FEED), Pre-FEED Concept Evaluation Study (PFCES), Project Environmental Impact Assessment (EIA), comprising both onshore and offshore studies, dredging, EIA activities and ambient noise survey, displacement and settlement action plan (FED-RAP), cultural site heritage study, staff and administration project cost from inception, sustainable development cost, among others”, he said.

Dikko said that the project which was conceived and designed to assist in monetizing the nation’s abundant natural gas resources, reduce gas flaring, and create employment for the Niger Delta youth, was already at a critical point of Final Investment Destination before the pull out of its major partner, the Conoco Philips.

He said as contained in the shareholders’ agreement, Conoco Philips, whose investment value was $192 million received only one dollar as entitlement.

The general manager, who noted that the exit of Conoco Philips was a serious setback, explained that the corporation’s decision to work with the company to deliver the project was due to its readiness to provide the needed technology to drive the process; while assuring that NNPC and the remaining shareholders had considered other simple options to bring the project alive.

He clarified that the estimated amount to complete the project was far from what is being alleged, noting that NNPC deploys its negotiation capacity to extract value for the nation.

“At inception, the project cost to build the plant was estimated at about $18 billion and not $22 billion, using Optimized Cascade Technology (A Conoco Philips LNG technology) of 2-train (10MTPA). However, this cost estimation was further revised downwards to about $16.5 billion CAPEX value in October, 2016 under project economics comparison that was carried out with PFCES of APCI Case Technology assumption”.

Earlier in his remarks, the Committee Chairman, Hon. Jerome Amadi Eke, said that the essence of the meeting was to enable the Committee get the needed facts to deal with the petition and called for facility visit to confirm some of the projects as documented by the corporation.

  – Apr. 17, 2019 @ 11:13 GMT |

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