Nigerian National Petroleum Corporation has said that a consortium of Chinese banks have invested $250 million in the Nigerian petroleum industry.
NNPC in a statement in Abuja, also announced plans to expand gas generation and distribution nationwide to attain the Federal Government's target of 10 gigawatts (GW) of electricity. According to the statement, Group Managing Director of the NNPC, Mr. Maikanti Baru, disclosed this when a delegation of the Nigerian Gas Association led by its President, Mr. Dada Thomas, paid him a courtesy visit.
Baru said the investments were secured from the Chinese banks, which were staking their funds in the Nigerian petroleum industry for the first time, at the recent financing agreements signed in London. He added that the Chinese banks had made commitments to bringing in as much money as might be needed to finance oil and gas investments in Nigeria.
He said, "On that occasion, I did challenge the Chinese banks that since they have now come on board, they should move from the back seat to the driver's seat and they gave me their commitment that they have plans to bring in as much money as we need to execute our projects. And if the Chinese tell you that they are going to do it, definitely they will do it and we will give them a run for their money."
Commenting on the 10GW electricity target, Baru explained that the recent debt settlement for the Joint Ventures would have great impact on the gas industry, especially as the initiative was capable of freeing some dedicated funds that could be used to develop the sector. He said, "We have the aspiration of government to rise power generation to at least 10 giga watts capacity, not just 10GW in terms of installed capacity, but one that will be steady in the grid by 2020. All these will drive our activities to ensure that the gas business is expanded and government's aspiration to earn as much revenue from gas as oil will definitely be realized."
He further stated that current efforts to connect the eastern part of the country, where there are a lot of gas reserves, with the west, where high consumption demand exists, demonstrated NNPC's readiness to impact positively on the power sector. Baru disclosed that a lot had been achieved in the contracting process of the $2.7 billion Ajaokuta-Abuja-Kaduna-Kano (AKK) pipeline project. "We have gone far with the development of the project using the same paradigm shift of Public Private Partnership (PPP) financing. We have also gone far with the contracting process, part of which is to ensure that money meant for the project is raised from the private investors," he noted.
He argued that the feat recorded in the project would bring to the fore, a new dimension in gas projects execution in the country, nothing that this would signal a regime of private investors funding for such projects.
He said another project that would increase gas consumption in the country was the Ogidigben Gas Industrial City project, on which he said, NNPC was committed to seeing it come to fruition, stressing that what was remaining is getting the developer to bring in the various investors to put their industries in place.
Furthermore, the NNPC chief said the corporation would make inputs into the National Gas Policy recently adopted by the Federal Executive Council as well as the Fiscal Bills on gas being worked out by the legislature, with the view to ensuring that gas takes its rightful place in Nigeria's domestic energy mix.
While commending the NGA for its efforts to develop the gas sector, Baru called on the Association to extend its advocacy to the power sector being the major consumer of gas in the country.
He pledged the NNPC's continuous support to NGA in the execution of its mandate and continuous relevance in the industry.
Speaking during the visit, NGA President, Mr. Dada Thomas, applauded Baru for the numerous initiatives that he had taken so far to turn around the fortunes of the Corporation and the country's economy at large.
"We would like to congratulate the NNPC on a number of paradigm shifts, changes and initiatives it had brought to the fore in recent times. I am talking about the new alternative funding which you recently signed with Shell and Chevron to the tune of $1.78Billion, the Clearing of $400million debt in April, the progress being made on the Elf 2loop lines and the OB3 gas project, one of the most critical gas pipelines in the country," Thomas stated
He declared that this gale of achievements by NNPC informed NGA's huge confidence in the current Management of the Corporation to transform the country's Oil and Gas Industry.