Page 6 - AfrOil Week 38 2019
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PIPELINES & TRANSPORT
AfrOil
The Chinese company had been considering an alternative export route – namely, a shorter and cheaper pipeline through Chad and Cameroon that would have terminated in the deepwater port of Kribi. It even signed an agreement with
the government of Cameroon on this project in 2013.
The parties never launched construction, however, largely because of tensions between CNPC and the government of Chad.
INVESTMENT
Nigeria LNG seeking $10bn in financing for Train 7 expansion scheme
NIGERIA
TONY Attah, the CEO of Nigeria LNG (NLNG), said last week that the consortium intended to finance a $10bn expansion project through a combination of debt and equity.
According to Attah, the group has already begun talks with commercial lenders in a bid to secure $2bn worth of loans, enough to cover 20% of projected costs. To this end, it is holding discussions with some of Nigeria’s 10 biggest banks, including Zenith Bank and Guaranty Trust Bank, he told Bloomberg in an interview.
With respect to the remaining $8bn, he said, NLNG will seek financing from foreign banks and from export credit agencies. “We have done the financial market pitch to know who has capacity,” he commented.
The consortium has appointed Guaranty Bank and Sumitomo Mitsui Banking of Japan to serve as its advisor for the fund-raising pro- cess, he added. NLNG is seeking financing to cover the $7bn cost of building Train 7, a new gas liquefaction unit that will boost its produc- tion capacity by 40%, and the $3bn cost of pro- ducing and transporting the gas that will serve as the facility’s feedstock.
Attah went to say that the consortium still expected to make a final investment decision (FID) on the Train 7 project by October 31. In the meantime, he said, NLNG is wrapping up a
sales campaign for the fuel coming out of Trains 1, 2 and 3, and anticipates signing bilateral deals with current and new clients before the end of October.
He also noted that the group had already signed sale and purchase agreements (SPAs) with a number of existing and new clients for future LNG production from Train 7. Bangla- desh, Jamaica, Jordan and Pakistan are likely to be among the biggest buyers of LNG from the new production facility, he said.
Train 7 will be part of the Bonny Island gas liquefaction plant. The facility is currently capable of turning out 22mn tonnes per year of LNG. Once Train 7 comes on stream, its pro- duction will rise by 8mn tpy to 30mn tpy.
Nigeria LNG has four shareholders: Nigeria National Petroleum Corp. (NNPC), with 49%; Royal Dutch Shell (UK-Netherlands, 25.6%), Total (France, 15%) and Eni (10.4%). Earlier this month, the group appointed SCD – a con- sortium formed by Saipem (Italy), Daewoo Engineering & Construction Co. (South Korea) and Chiyoda (Japan) – to serve as its contractor for engineering, procurement and construction (EPC) work on Train 7. Once this milestone is reached, SCD will be able to start work and wrap up construction of the new production train in four to five years..
Nigeria LNG’s Train 7 project has a price tag of $10bn (Photo: KBR)
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w w w . N E W S B A S E . c o m Week 38 25•September•2019
