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NNPCL, Indorama seal deal to unlock $18bn revenue for Nigeria

The Nigerian National Petroleum Company Limited (NNPCL) on Saturday signed an agreement with Indorama Petrochemicals Company Limited which will enable both parties to explore and develop suitable opportunities across the hydrocarbon value chain that would unlock about $18bn revenue for Nigeria

The Group Chief Executive of the NNPCL, Mallam Mele Kyari, signed the agreement for the national oil company while the MD of Indorama, Manish Mundra, signed on behalf of his company.

Speaking at the event, Kyari said the NNPCL as the national energy company has one of its roles as enshrined in article 64(i) of the Petroleum Industry Act (PIA) to promote the use of natural gas through the development and operation of large-scale gas utilisation industries.

He said this role is in alignment with its Nigasification strategy which is a consolidation of critical programmes embarked upon by NNPCL to utilise natural gas and its associated liquids to be the energy source of choice, spur economic growth, free up crude oil for exports, and ultimately enable job creation.

Indorama plans to operate the largest Petrochemical Hub in Africa, and it currently owns the world’s largest single-train Urea Plant located in Port Harcourt Nigeria.

The company is currently working on expansion plans within the next six years, in the gas-based heavy manufacturing industries including fertiliser, methanol, and petrochemicals.

Kyari said with this alignment of objectives to promote the development and use of natural gas for large-scale heavy gas-based industries, the NNPCL and Indorama agreed to enter into the MoU.

Listing the key benefits of the pact, Kyari said it would assist in the monetisation of over 1.7 TCF of gas and 100 million barrels of oil reserves, generation of upstream lifecycle revenue of over $18bn including government take of over $7bn, downstream production of about 4.8 MTPA of products including methanol, urea, and fertiliser to boost national food security.

Other benefits, he added, include the creation of direct and indirect employment, the development of a condensate refinery to boost petroleum product supply and reduce product importation, annual GDP contribution of over $3.8bn, and attraction of over $7bn of foreign direct investment into the country.

In his comment, the Indorama boss said the partnership with NNPCL and Indorama has lasted for almost 17 years, adding that both companies have worked collaboratively in the area of petrochemicals.

He said Nigeria’s gas reserves and strategic location should position the country as one of the largest producers of urea, ammonia, methanol and petrochemical polymers.

He said: “What we are going to do is to invest in two more lines of fertiliser, two lines of methanol and one big petrochemical project besides the condensate refinery and other pipeline infrastructures.

“This will already put Nigeria as not just the largest producer of urea in Africa but the Western Hemisphere. And this is just one example. NNPCL can create almost 10 to 15 partnerships.”

Earlier, Bala Wunti, the Chief Upstream Investment officer, NNPC Upstream Investment Management Services; said through the pact, about 800 million SCF of gas will be made available for domestic use.

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