The Guardian (Lagos)
Laolu Akande
8 October 2001
New York — Americas's sixth largest oil conglomerates, Phillips Petroleum company, is to invest some $85 million in a new independent power project in the country. The Guardian has learnt.
The sum is to serve as its 20 per cent share in a joint venture with another oil firm, Agip and the Nigerian National Petroleum Corporation (NNPC) which are to invest 20 per cent and 60 per cent respectively.
A statement from the Oklahoma based American oil giant, said the investment would be through its Nigerian subsidiary, Phillips oil company (Nigeria) Limited.
The power project is to be built near Kwale, Delta State.
"The power project is part of Phillips development stategy for Nigeria and will utilize 600 bilion cubic feet of gas produced by the joint venture," said Henry McGee, president, Phillips Europe-Africa division in a statement on Wednesday last week.
Nigeria added: "That Philips will book approximately 20 million barrels of oil eqivalent of proved reserves this year as a result of the approval of this power project investment. The project also will help eliminate gas flaring by 2004, ahead of all other oil companies operating in Nigeria."
According to the statement, the power plant will be tied into the Onitsha substation approximately 50 kilometers from Oil Mining Lease (OML) 60 and will help bring electricity to people in 14 of the nation's 36 states.
The Kwale power plant will cost $425 million and is expected to begin operations in 2004. It was said that the Federal Government has provided significant tax and other incentives to the project.
We are serious about our investment in Nigeria and pleased to help Nigerian President Olusegun Obasanjo in his endeavour to ensure that the people of Nigeria have access to the benefits that oil and gas exploration can bring," the statement added.
Only last Monday, President Obasanjo said that Nigeria would diversify its dependence on oil, and aim to earn as much from its huge gas reserves as it does from crude oil before the end of the decade.
He said in independence anniversary broadcast that his administration had pursued policies aimed at enhancing the revenue from gas, adding that the objective is to earn as much from gas as the country is currently doing from crude oil in the first decade of the 21st century.
Nigeria joined the big league of Liquified Natural Gas (NLNG) exporters in late 1999 when the Bonny Plant began production.
Since then, the Nigerian Liquified Natural Gas (NLNG) Company has delivered a total of 144 cargoes to European term buyers and 14 to the United States spot market, the company said last week.
NLNG has long-term contracts with Italy's Enel, Spain's Enagas, Botas of Turkey, Gaz de France and Portugals Transgas.
The Bonny plant, operated by the NNPC in a joint venture with Eni-Agip, Royal Dutch/Shell and TotalFinaElf, currently produces gas from two trains at the Bonny facility, the biggest industrial investment in Sub-Saharan Africa.
A third train of similar design and capacity as the 5.9 million tonne per annum base project is now under construction and is scheduled for completion next year.
Nigeria NLNG ltd has announced it will export two cargoes of gas to Europe this month, marking its official breakthrough into the European spot market.
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