The proposed facility will be the largest methanol plant in Africa and the first in Nigeria.
The construction phase is expected to create 30,000 direct and indirect jobs and additional 5000 permanent jobs during the operations’ phase.
According to the financing plan, the project is estimated to cost about $3.5bn and aside from the equity from NCDMB, NNPC and DSV, there is an impressive cast of lenders, which includes a consortium of Chinese banks led by the China Exim Bank, African Development Bank (AfDB), international commercial banks, regional banks and African institutions and they would be expected to rise 70 per cent of the project cost.
Other agreements that have been firmed up to include a Gas Supply Purchase Agreement (GSPA) with the Shell Petroleum Development Company (SPDC) led joint venture, offtake agreements and contracts for engineering procurement and construction and technology provider.
The Executive Secretary of Nigeria Content Development and Monitoring Board (NCDMB), Simbi Wabote, the Group Managing Director (GMD) of the NNPC, Mele Kolo Kyari and Executive Vice-Chairman of BFPCL, Ben Okoye, signed the FID on behalf of their organisations.
In his remarks at the event, Executive Secretary NCDMB underscored the significance of two Federal Government’s agencies – NCDMB and NNPC – catalysing investments in the country.
He added that the project would place Nigeria in the world’s map as one of the top 10 producers of methanol.
He emphasised that local content could only grow sustainably when there are oil and gas projects, adding that a mega project of this size provides opportunities to utilise local capacities and capabilities built over the years.
He further explained that opportunities provided by the project in job creation, gas utilisation, local availability of methanol for primary and secondary users, formed part of the basis of the Board’s decision to partner with Brass Fertiliser and Petrochemicals Company Ltd, to enhance the delivery of the project.
Wabote also commended the Federal Government for recording huge achievements in the energy sector, at a time when most nations are unsure of decisions to make amid the COVID-19 pandemic.
The GMD NNPC, in his comments, described the BFPCL as the third most important project that had taken FID in the last five years.
He stated that achieving FID for the project was proof of the Federal Government’s commitment to monetise the nation’s gas resources, notwithstanding the challenging investment environment. He pledged the commitment of NNPC to ensure the delivery of the methanol plant on schedule by 2025.
According to him: “The country is blessed with abundant gas resources, over 200 trillion standard cubic feet of gas (tscf) proven, with the potential of over 600 tscf. As energy transition processes go on, you must monetise these gases as quickly as possible. NNPC will continue to collaborate with all the strategic partners. We will ensure that feedstock is available for this project and subsequent projects that would happen in the Brass hub.”
Executive Vice-Chairman of BFPCL, Ben Okoye said that jobs that would be created from the project would help to assuage the restiveness in the Niger Delta in addition to the development of a new oil and gas city in Brass Island.
