- NNPC is reviving the Brass and Olokola LNG projects, estimated to cost $29.8 billion. The company aims to boost Nigeria’s gas capacity by over 22 million tonnes annually.
- The initiative, announced at the Gastech conference, follows decades of delays due to market conditions and political decision-making, with strong support from President Bola Tinubu’s reforms.
The Nigerian National Petroleum Company Limited (NNPC) has reopened discussions with investors to revive two long-abandoned Liquefied Natural Gas (LNG) projects: the Brass LNG in Bayelsa State and the Olokola LNG in Ogun State. The combined estimated cost of these projects is $29.8 billion.
NNPC Chief Financial Officer Umar Ajiya announced this initiative at the 2024 Gas Technology Conference and Exhibition (Gastech) in Houston, United States. The Brass LNG project, valued at $20 billion, and the Olokola LNG project, estimated at $9.8 billion, are among Nigeria’s most significant gas infrastructure investments.
They are expected to enhance the country’s gas capacity by over 22 million tonnes annually. However, both projects have faced significant delays due to unfavourable market conditions and slow political decision-making.
Ajiya explained that past declines in gas prices and high capital expenditures deterred potential investors. The Brass LNG project, initiated in 2003, aimed to monetise Nigeria’s vast natural gas reserves.
However, it struggled after the withdrawal of critical international oil companies (IOCs) like ConocoPhillips, leading to its abandonment. The Olokola LNG project started in 2005, was similarly affected after partners such as BG Group, Shell, and Chevron exited due to concerns about Nigeria’s business environment, leaving NNPC as the sole investor.
Despite these challenges, Ajiya praised President Bola Tinubu for his support in advancing new projects. He cited the impact of the Presidential Executive Orders on Oil & Gas Reforms and the Petroleum Industry Act of 2021, which offers fiscal incentives to attract investors.
At the conference, Dr Philip Mshelbila, Managing Director and CEO of Nigeria LNG Limited, discussed the need for substantial investment in infrastructure to facilitate energy transition in developing nations. He highlighted barriers like inadequate pipelines and storage facilities, high LNG import costs, and energy poverty that hinder access to cleaner energy.
Mshelbila urged global policymakers to prioritise energy equity and inclusion, particularly to meet the energy needs of the growing African population.
The Nigerian government focuses on natural gas as a transition fuel and recently launched the Decade of Gas initiative, which will be implemented with strong support from Nigeria LNG Limited.