Tony Attah, MD, NLNG
Nigeria Liquefied Natural Gas (NLNG) is of the successful gas companies in Nigeria and across the globe. As part of its thriving gas business, the company is planning to increase its existing 6 Trains by adding the 7th Train in order to expand its scope.
Managing Director of NLNG, Tony Attah disclosed that timing is critical to the success of its planned Train 7 project. The project is devoid of political interference.
The depth of its focus on promoting Train 7, which would lift output by over 8 million tonnes a year (t/y) from the 2017 level to 30m t/y by 2023, will raise investment for the company.
The project is crucial as it makes NLNG a global player and helping to build a better Nigeria. Over the years the gas company has grown to be the fastest growing LNG project in the world. The Train 7 project will build capacity and it is a game changer.
Nigeria was the world’s fourth-biggest exporter of LNG behind Qatar, Australia and Malaysia between 2015 and 2017. NLNG exports reached a record 21.3m t/y 2018.
The company wants to raise almost $7bn to cover the cost of the construction and a further $5bn for upstream investment to ensure gas feedstock.
Attah pointed out that “The most important factor is government support and we can safely say we have that now. Previous administrations saw Train 7 as one of many other competing potential projects, this government is more focused on us.” Train 7 is a crucial part of a planned gas revolution needed for the country to diversify from oil exports. The project also faces less technical challenges than other major LNG projects.
NLNG adopts a dual FEED approach by using consortiums of firms with the aim of shortening the 9-12 months of the project. Most of the firms are of international repute with many of such projects to their credit.
Attah added that the technical and political challenges are the “only conventional risks”, the project faces, which is even more vital to get it producing to hit the 2023 “window” that the LNG market has targeted for a global tightening in supply.
According to him, “The door is opening in front of us and we are actualizing the dream that is Train 7. We have very credible government support, and equally strong support from our shareholders.”
NLNG has been structured so that the International Oil Companies (IOCs) own majority of the company. The state-controlled Nigerian National Petroleum Corporation (NNPC) owns 49%, while Shell has 25.6%, Total and Eni share the remaining at 15% and 10.4% respectively.
The joint venture status, and the resulting political independence has aided Nigeria LNG in fostering an image of financial probity that’s appealing to international investors. In July, the company said it had fully repaid $5.45bn of shareholder loans.
Attah stressed that the company’s excellent track record of loan repayments to international lenders over the two decades since the project’s inception.
The NLNG boss stated further that “We can’t control the market, and are mindful of other unexpected risks that will arise. This is why we are focused on always achieving competitiveness in this project. In the lead-up to the FID, during the post-FID period and in the years running up to 2023, we will need to be strong as the market rapidly evolves with new players and new demand.”
He maintained that the company is clearly considering all the factors that it can to push the project forward, but Train 7 also faces strong competition for the portion of the global energy investment pot it is targeting—and in that race domestic stability will also need to play a crucial role.
The project is believed to improve the status of gas for Nigeria with maximum output.