By Fasilat Oluwuyi & Abdulwaheed Sofiullahi
The Indorama Group has signed a memorandum of Understanding (MoU) with the Nigerian state hydrocarbon company NNPCLtd to bolster its gas offtake in the Nigerian market.
Indorama Eleme Petrochemicals (IEP), the Nigerian subsidiary of the Singapore based, Indonesian founded conglomerate, already receives over 100Million standard cubic feet per day of gas from the Nigerian Agip operated assets in Rivers and Bayelsa States in eastern Nigeria, to produce fertilizer and other petrochemicals. IEP also takes up Propane from the NNPC operated Oredo gas plant in Edo State, (in the country’s Midwest), but this MoU indicates that it will expand.
The NNPC statement on the MoU is vague on details about the volume per day of natural gas that the expansion will entail, but it notes that “the opportunities include the monetization of over 1.7 TCF of gas and 100Million barrels of oil reserves, generation of upstream Gas Supply”.
While the 1.7Trillion cubic feet is not an indication of a yearly offtake or the offtake for the entire period of the agreement, there is a hint from the part of the statement that says that the Indorama transaction looks toward “downstream production of about 4.8 MillionTonnes Per Annum (MMTPA) of products, including methanol, urea, and fertilizer to boost national food security”. Now 4.8MMTPA of petrochemicals will easily utilize over 200Million standard cubic feet of gas per day (200MMscf/d), but the details are still to be released.
The statement by Garba Deen Muhammad NNPCL’s Chief Corporate Communications Officer, adds that the MoU by NNPCL and Indorama “follows Nigeria’s President Bola Ahmed Tinubu’s commitment in India a few weeks ago to strengthen business relations between both countries”.
But Indorama is not an Indian owned group.
In the statement Mele Kyari, the Group CEO of NNPCL, is quoted as saying that the ”project aims to bring an annual contribution of $3Billion to the nation’s GDP and a lifetime contribution of $18Billion to government revenue”.
Kyari also reportedly said the project indicated in the MoU, will generate “upstream lifecycle revenue of over $18Billion”.
