Page 12 - DMEA Week 09 2021

DMEA PIPELINES DMEA

AKK pipeline project under scrutiny

AFRICA MELE Kyari, the group managing director abided by all relevant regulations on the use of
of state-owned Nigerian National Petroleum local content. For his part, Sani Abubakar, the
Corp. (NNPC), has sounded an upbeat note on executive vice-chairman of Brentex Nigeria, told
the Ajaokuta-Kaduna-Kano (AKK) pipeline, members of the House of Representatives last
saying that work on this domestic natural gas week that local content rules had been upheld
artery is moving forward. However, the project because his company was Nigerian-owned.
has drawn some unwelcome attention lately. Legislators responded by saying they
Kyari reportedly announced during a virtual intended to seek more information on the dis-
event organised by the Nigerian Gas Association pute. They asked all of the companies involved
(NGA) last week that NNPC was on track to fin- to submit contractual documentation for review
ish extending the 614-km AKK pipeline across and said they intended to invite representatives
the Niger river by the end of March. of Nigeria’s Bureau of Public Procurement (BPP)
At the event, Yusuf Usman, the company’s to testify.
chief operating officer for gas and power, quoted
the managing director as saying that the link Legal dispute
would benefit Nigeria by allowing it to move gas Nigerian lawmakers met to discuss the matter
from fields in the east to the western part of the shortly after the AKK project ran into a legal
country. snag, with the head of the Federal High Court
in Kano State issuing an order suspending con-
Contractor disputes struction work on the project.
This announcement was made shortly after Justice Sa’adatu Mark said he had taken this
members of Nigeria’s House of Representatives step in response to the submission of documents
raised questions about NNPC’s contracting alleging that NNPC and its contractors did not
practices for the project. follow due process when acquiring land for the
In response to a petition submitted by a local pipeline.
advocacy group, the legislators submitted a The order will stand until mid-April, when
query for the purpose of determining whether the court is due to resume discussions, according
the state-owned company had unlawfully pre- to Nigerian press reports.
vented Bablinks Resources, a Nigerian firm, NNPC’s contractors are building the AKK
from carrying out its obligations under the pipeline along a 614-km route that runs north-
$2.6bn contract for construction of the 318.6-km ward from the left bank of the Niger river in Kogi
Kaduna-Kano section of the pipe. State to the capital city of Kano State.
Bablinks had originally teamed up with Bren- AKK is due to serve as the first section of the
tex Nigeria, another local firm, and China’s CPP Trans-Nigeria Gas Pipeline (TNGP) but will
for the project. also pump gas to domestic TPPs, thereby mak-
It had hoped to provide construction and ing electricity more widely available throughout
engineering services, leaving pipeline procure- the country.
ment to Brentex and financing to CPP. But Bolaji The pipe will have a design capacity of 3.5bn
Isiaka, Bablinks’ managing director and CEO, cubic feet (99.11mn cubic metres) per day, or
has claimed that his company was never permit- about 36.175bn cubic metres per year. Initially,
ted to carry out the work, even though it pro- throughput will amount to 2 bcf (56.64 mcm)
vided the technical expertise needed to execute per day, or around 20.67 bcm per year. As such,
the project. the project will significantly increase the volume
He also told legislators last week that Bablinks’ of gas available on Nigeria’s domestic market.
exclusion had been in violation of Nigeria’s local The cost of construction is expected to reach
content law because it created an opening for $2.8bn. NNPC is financing 85% of this sum
CPP to hire more Chinese workers. with a loan facility from China Export & Credit
NNPC has responded by defending its deci- Insurance Corporation (Sinosure) that is due to
sion to work with Brentex and by saying it has be repaid over a period of 12 years. ™

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