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NNPC denies graft at AKK gas pipe

NIGERIA NIGERIAN National Petroleum Corp. (NNPC) undergone “a transparent and open competitive
has denied that the budget of its Ajaokuta-Ka- tender process” where the most competitive bids
duna-Kano (AKK) gas pipeline was inflated by were chosen.
$1.53bn. “Approval of all relevant authorities was
The national oil company (NOC) was obtained after an intense scrutiny by the vari-
responding to an article by Nigerian daily ous agencies,” NNPC said. “This is a deliberate
Point Blank News on September 7, which said attempt to mislead the Nigerian public with
the Bureau for Public Procurement (BPP) had baseless information.”
uncovered evidence of corruption. NNPC drove The BBP’s director, Alhaji Maman Ahmadu,
up pipe costs for the project from $513 to $3,000 was quoted in the press as saying that NNPC
per metre, it said. had followed due process in procuring pipes for
Point Blank said it had a copy of a report by AKK.
BPP and published photographs of several pages, The 614-km pipeline is due to deliver up
although no heading or page numbers were vis- to 56mn cubic metres per day of gas to power
ible. It quoted the bureau as saying that NNPC’s plants in the states of Abuja, Kaduna and Kano.
pipe contract was “a hastily compiled, tardy and These stations are being built as part of Nigeria’s
unprofessional submission, which is bereft of any programme for expanding the share of gas in its
significant engineering inputs, technical infor- electricity mix.
mation and without consideration for the unit Construction had been scheduled to begin in
rates or the bill of quantities as is usually expected the first half of 2020, but did not start until early
in the review of such engineering projects.” July because of coronavirus (COVID-19) related
“We are also reliably informed that as at pres- disruptions. The engineering, procurement and
ent date, there is still no detailed design, neither construction (EPC) contractors picked for the
are there technical specifications for the project,” pipeline were Nigeria’s Oilserv, Oando and Bren-
Point Blank quoted the BPP as saying. tex Petroleum Services, and China’s First High-
These allegations are “false, baseless and way Engineering and China Petroleum Pipeline.
unfounded,” NNPC said in a statement, adding China Export and Credit Insurance Corpo-
it was considering legal action. The BPP itself has ration (Sinosure) has pledged to underwrite up
denied the discovery of graft at the project. to 85% of the pipeline’s cost, projected by NNPC
The bureau judged the pipe costs to be rea- to be $2.6bn.™
sonable, NNPC said, noting that the project had

DFC clears $1.5bn in risk

insurance for Area 4 gas project

POLAND THE board at US International Development ExxonMobil and Italy’s Eni expect to com-
Finance Corp. (DFC) has signed off on $1.5bn in mence production in 2024 from the 15.2mn
political risk insurance for the Area 4 gas devel- tpy Rovuma LNG project that will be supplied
opment off Mozambique. with Area 4’s gas. But a final investment decision
Area 4 contains some 2.4 trillion cubic (FID), due to be taken this year, has been delayed
metres, with development led by ExxonMobil until 2021 in light of the market collapse.
and Italy’s Eni. The pair aim to bring on stream ExxonMobil will manage the construction
two separate LNG projects over the next four and operation of Rovuma LNG’s gas liquefaction
years, with a combined output of 18.6mn tonnes and related facilities, whereas Eni is set to over-
per year (tpy). see upstream development. The companies each
The gas project will expand Mozambique’s have 25% shares in Area 4, while China’s CNPC
GDP by an average of $15bn per year, the DFC owns a 20% interest. Mozambique’s national oil
said, “positioning one of the world’s poorest company (NOC) ENH, South Korea’s KOGAS
countries to achieve lasting, long-term economic and Portugal’s Galp each have 10% stakes.
growth.” The corporation’s insurance will cover Eni is also taking the lead at the 3.4mn tpy
development, construction and operation of an Coral South floating LNG (FLNG) project at
onshore liquefaction plant and supporting facil- Area 4, sanctioned in 2017 and expected online
ities, it said. in 2022.

P8 www. NEWSBASE .com Week 37 17•September•2020