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DMEA FUELS DMEA

NLNG aims to cut LPG exports

AFRICA THE Nigeria LNG (NLNG) consortium has said NLNG has already taken some steps to
it will reduce exports in order to raise the vol- address this shift in demand. For example, it has
ume of LPG delivered to the domestic market to expanded its roster of off-takers to include 43
450,000 tonnes per year (tpy), in line with previ- companies, up from just six in 2007. But it may
ously announced plans. have to do more: according to Mele Kyari, the
According to Philip Mshelbila, NLNG’s man- group managing director of state-owned Nige-
aging director, the consortium is cutting exports rian National Petroleum Corp. (NNPC), said on
in light of Abuja’s efforts to promote domestic gas November 2 that the country needed to spend
consumption. “As part of the measures to sup- about $2.7bn on natural gas and LPG distribu-
port the federal government’s efforts to deepen tion infrastructure projects.
domestic gas supply and economic growth, NNPC is in the process of being replaced by a
Nigeria LNG is reducing LPG exports and new state-controlled entity – Nigerian National
increasing supplies to [the] domestic market,” Petroleum Co. Ltd (NNPC Ltd), an incorporated
he was quoted by S&P Global Platts as saying at firm with no direct access to government fund-
an industry conference in Lagos on November ing. Presumably NNPC Ltd will inherit NNPC’s
2. “NLNG is now increasing supply to domestic 49% stake in NLNG. The remaining equity will
market to 450,000 tonnes per annum.” continue to be split between Royal Dutch Shell
Mshelbila did not say when the group hoped (UK/Netherlands), with 25.6%; TotalEnergies
to push deliveries up to 450,000 tpy. Earlier this (France), with 15%, and Eni (Italy), with 10.4%.
year, though, his predecessor Tony Attah noted Together, the partners operate a gas liquefac-
that NLNG had turned out 370,000 tonnes of tion plant on Bonny Island.
LPG in 2020 and aimed to raise the figure to The facility has been operating since 1999,
450,000 tonnes in 2022. and it has six production trains capable of turn-
Until recently, the consortium supplied only ing out a total of 22.5 mn tpy.
about 250,000 tpy of LPG to Nigerian consum- Its capacity is set to rise to 30mn tpy as a result
ers and exported the remainder of its output to of the Train 7 project, which envisions the con-
Western markets. However, demand for LPG has struction of a seventh production train that can
been rising in the West African country, and offi- produce 4.2mn tpy, as well as the debottleneck-
cials in Abuja expect it to climb from the current ing of existing trains, which will add another
level of about 1mn tpy to 3mn tpy by 2026. 3.4mn tpy of capacity.™

PIPELINES

Pipes set to boost FDI in Uganda, Tanzania

AFRICA UGANDA and Tanzania are set to see foreign EACOP alone will cost more than $3.5bn, he
direct investment (FDI) levels rise considerably added. Speaking at the same symposium, Betty
in the coming year as a result of crude oil and Namubiru, the national content manager of the
natural gas development, according to the Pri- Petroleum Authority of Uganda (PAU), noted
vate Sector Foundation of Uganda (PSFU). that the cost of developing the fields near Lake
Elly Karuhanga, the chairman of PSFU, Albert that will provide throughput for EACOP
said last week that much of the increase would was anticipated to reach $9bn. These upstream
occur on the back on the East Africa Crude projects have already drawn some $3.5bn in
Oil Pipeline (EACOP) project, which provides FDI, and a related midstream initiative – namely,
for the establishment of a new oil export route the planned construction of an oil refinery at
connecting fields in western Uganda to Tanza- Kabaale – is set to attract another $4bn, she said.
nia’s coast. This project alone could boost FDI The refinery project is currently in the front-
by 60% during the construction phase, he said at end engineering and design (FEED) study
the Tanzania-Uganda Oil and Gas symposium in phase, Namubiru stated. She also reported that
Dar-es-Salaam. He went on to say that EACOP Ugandan authorities had begun the process of
might create more than 5,000 jobs directly, along acquiring land along the planned route of the
with another 20,000 jobs indirectly. Under these 1,443-km EACOP link. The governments of
circumstances, he said, “communication is vital Tanzania and Uganda teamed up with TotalEn-
to bring local companies up to speed with what ergies (France) and China National Offshore Oil
is required of them to participate in this oil and Corp (CNOOC) to sign a package of agreements
gas sector.” on the EACOP project in April of this year. The
He further stated that the two countries’ oil parties have already agreed that some of the con-
and gas sector was set to attract a total of $20bn tracts for work on the pipeline will be reserved
worth of investment in oil and gas projects. for local companies.™

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