The UTM Floating Liquefied Natural Gas (UTM FLNG) Limited has signed a 15-year Wet Gas Sale and Purchase Agreement (GSPA) with the NNPCL/Seplat Energy Joint Venture (SEPNU), thereby securing feed gas for the Nigeria’s first indigenous FLNG project.
The agreement, which aligns with the Federal Government’s drive to monetise the nation’s untapped natural gas resources, was signed on Tuesday at the sidelines of the Nigeria Oil and Gas (NOG) Energy Week Conference in Abuja, provided for the supply of 200 million standard cubic feet of gas per day (mmscf/d) to the UTM FLNG facility over a 15-year period
Based on the terms, the agreement is expected to provide the long-term feed gas security required to advance financing, construction and operations of the 1.8 million tonnes per annum (MTPA) floating LNG project as well as boost investor confidence ahead of the project’s Final Investment Decision (FID) targeted for the fourth quarter of this year.
Speaking during the pact signing ceremony, the Group Chief Executive Officer of NNPC Limited, Engr. Bayo Ojulari, described the agreement as a desirable step towards improving the performance of the nation’s hydrocarbon resources industry and a demonstration of the government’s commitment to promoting gas utilization for domestic and industrial operations.
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Noting that the deal aligns with the Presidential drive to increase domestic gas utilisation by 2030 under the Decade of Gas initiative, Ojulari said the project would not only enhance Nigeria’s competitiveness in the global liquefied natural gas market but also contribute to industrialisation, economic growth and lower carbon emissions.
According to him, the gas supply agreement establishes a predictable revenue framework for the FLNG project, provides assurance of stable LNG supplies for buyers and offers lenders the confidence needed to support the project’s financing.
Ojulari enthused: “Today’s signing is not just an agreement—it is a declaration of intent to power Nigeria’s growth, prosperity, and energy future through gas.”
In his keynote address at the event, the Minister of State for Petroleum Resources (Gas), Hon. Ekperikpe Ekpo, described the pact as a major step towards achieving Nigeria’s gas commercialisation and energy transition objectives.
He maintained that the project would support the government’s industrialisation agenda by creating jobs, supporting local content development and attracting fresh investments into the gas value chain.
While reinstating the government’s commitment to creating an enabling environment for transformative investments through improved infrastructure, regulatory certainty and investor-friendly fiscal policies, Ekpo assured that the government would continue to prioritise reforms that position Nigeria as a gas-powered economy capable of competing effectively in global energy markets.
Speaking on the deal, the Promoter and Shareholder of UTM FLNG Limited, Mr. Julius Rone, said the signing represented a milestone in the development of the country’s first indigenous floating LNG project.
The industry expert explained that securing long-term gas supply remained one of the critical requirements for reaching FID, noting that the pact de-risks the project and enhances its commercial viability.
Rone described the deal as also demonstrating the growing confidence of investors, financial institutions and industry stakeholders in Nigeria’s gas sector, driven by ongoing policy reforms and regulatory stability.
By the terms of the agreement, the feed gas for the project, which was flagged off in 2021, will be sourced from Oil Mining Lease (OML) 104, specifically the Yoho Field located offshore Akwa Ibom State, and will be processed and liquefied aboard the UTM FLNG vessel, which has a production capacity of 1.8 million tonnes of LNG annually.
In 2021, the project secured its Licence to Establish (LTE) from the former Department of Petroleum Resources (DPR), now the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA).
By 2024, the NMDPRA granted the company a Licence to Construct (LTC), while the Nigerian Content Development and Monitoring Board (NCDMB) approved its Nigerian Content Plan for the Engineering, Procurement and Construction phase.
The project’s Pre-Front-End Engineering Design (Pre-FEED) was completed in 2021, while the Front-End Engineering Design (FEED) was concluded in October 2023 by JGC Corporation and Technip Energies. KBR serves as the Owner’s Engineer.
Under the shareholding structure, NNPC Limited holds a 20 per cent equity stake in UTM FLNG Limited, while UTM Offshore Limited holds 72 per cent equity and the Delta State Government holds the remaining 8 per cent.
Industry analysts believe the gas supply agreement represents a major step in the Federal Government’s agenda aimed at unlocking greater value from the nation’s vast gas reserves, deepening local participation in the energy sector and strongly positioning Nigeria as a competitive supplier in the global LNG market.
