The Nigerian National Petroleum Company Limited (NNPCL) weekend sealed an agreement with Indorama Petrochemicals Company Limited to deepen the implementation of Nigeria’s Nigasification strategy.
According to the Group Chief Executive of the NNPCL, Mallam Mele Kyari, the initiative will help to unlock about $18bn revenue for Nigeria and also enable the parties to the deal explore and develop suitable opportunities within the remits of both party’s interests across the hydrocarbon value chain in Nigeria.
While Kyari signed the agreement for the national oil company the Managing Director of Indorama, Manish Mundra, signed for his company.
Speaking at the pact signing ceremony, Kyari said that one of the company’s roles as enshrined in article 64(i) of the Petroleum Industry Act (PIA) was to promote the use of natural gas through the development and operation of large-scale gas utilization industries.
According to him, the role is in line with its Nigasification strategy which is a consolidation of critical programs embarked upon by NNPC to utilize natural gas and its associated liquids to be the energy source of choice, spur economic growth, free up crude oil for exports, and ultimately enable job creation.
Indorama plans to operate the largest petrochemical hub in Africa, and it currently owns the world’s largest single-train Urea Plant located in Port Harcourt, Nigeria.
The company is currently working on expansion plans within the next six years, in the gas-based heavy manufacturing industries including fertilizer, methanol, and petrochemicals.
Kyari explained that the agreement with Indorama represented an alignment of objectives to promote the development and use of natural gas for large-scale heavy gas-based industries.
He listed some of the key benefits of the pact as including the monetization of over 1.7 TCF of gas and 100 million barrels of oil reserves, generation of upstream lifecycle revenue of over $18bn including government take of over $7bn, downstream production of about 4.8 MTPA of products including methanol, urea, and fertilizer to boost national food security.
The NNPCL Group CEO identified other benefits of the MoU as the creation of direct and indirect employment, the development of a condensate refinery to boost petroleum product supply and reduce product importation, annual GDP contribution of over $3.8bn, and attraction of over $7bn of foreign direct investment into the country.
Kyari maintained that the deal also marked the beginning of a journey of co-created solutions between the two companies that will contribute significantly to the double-digit economic growth rate aspiration of the government and generate tremendous value for all the stakeholders including the investors, the companies, the community, and the country at large.
Speaking on the deal, the Indorama boss said the partnership with NNPCL and indorama has lasted for almost 17 years adding that both company have work collaboratively in the area of petrochemicals.
Mundra said Nigeria’s gas reserves and strategic location should position the country as one of the largest producers of urea, one of the largest producers of ammonia, the largest producers of methanol and the largest producer of petrochemical polymers.
The industry expert said: “This will already put Nigeria as one of the largest producers of urea in Africa and Western Hemisphere. And at the time, this is just one example. NNPC can create almost 10 to 15 partnerships. Imagine when we start here.
“The ball is rolling now and it’s our responsibility that we work together. We partner together, grow together, invest and distribute the benefit of this industrialization positioning”, he added.
