Former Head of Interim National Government (ING), Chief Ernest Shonekan, has called on President Goodluck Jonathan to approve Train Seven of Nigeria’s Liquefied Natural Gas (LNG) project, Bonny Island, to save the country’s share of the global gas market.
He said Nigeria had 10 per cent of the global market share of gas in the past, but expressed dissatisfaction that it had dropped to about seven per cent because of the emergence of new markets.
Shonekan spoke during his visit to the LNG Plant in Finima, Bonny Island, Rivers State, Tuesday.
He said Nigeria had earned over $9 billion as dividend from the gas plant and urged the Federal Government to shore up the nation’s revenue base by approving the project.
“Indeed, what has surprised keen observers of the industry has been the exponential rate at which this company has grown. The success which greeted the Nigeria LNG Limited’s project had accelerated the execution of plans, now at an advanced stage, for the building of the seventh train.
" From Nigeria LNG Limited, the government which still has oil as its major foreign exchange earner, has reaped over $9 billion as dividends,” he said.
He frowned at the fact that Nigeria was still flaring gas and said the approval of Train Seven of the LNG would reduce the amount of gas flared and increase the nation’s revenue.
His words: “Nigeria is still a poor country; our government and compatriots will be very grateful if you bring in more money. A revenue of over $9 billion is heart warming, but our poverty is such that we thirst for even more revenue to solve our developmental problems especially to replace our decaying infrastructure and to make investments that will create more jobs.
“That Nigeria is still flaring gas is an unacceptable fact in today’s world, not only from a health and environmental perspective, but also for the basic fact that the perpetrators are burning cash. Again, as a former captain of industry and a statesman, I find it detestable that our country not only still leaves value on the table and walks away, year-after-year, but also continues to literally pour money into flames by flaring gas.
“These are some reasons that you must get on with Train Seven immediately. In my earlier conversation with your managing director, he volunteered that Nigeria’s LNG has a very strong balance sheet and therefore does not need money from the Federal Government purse to expand. It only needs government approval and support of its shareholders to build train seven.
“I am not entirely sure about what is delaying train seven. I gather that sales and purchase agreements for it were signed five years ago with buyers.
Whatever might be delaying train seven, I call on the government to step in and ensure that the construction of that train takes off immediately. The time for it is now,” Shonekann said.
He said the nation was encountering many challenges of development and that it was no more time to choose options when the nation could pursue multiple projects to attain greatness.
According to him, “Nigeria LNG Limited was once the fastest growing facility in the world. Now it has lost its place in front of the queue to Qatar and Australia.
These countries have moved their output from 20 million metric tonnes range to 80 and 81 million metric tonnes respectively, while NLNG is stuck at 22 million metric tonnes.
“We are a country with very huge gas reserves (our gas reserve surpasses our oil reserve) and sale of gas is not regulated by OPEC. This is why we must take advantage of this God-given resource and develop our dear country.
“Nigeria no longer has the luxury of deferring major decisions or of picking and choosing developmental projects to do and in what order. The LNG market is tightening. Other nations are not staying idle.”
He said the new gas project would be constructed at no cost to the government and provide employment opportunities to more than 1,000 people", he said.
He further said: “From the stand point of economics: Train 7, like its predecessors, is viable; it is all plus and no minus for Nigeria. It will bring in Foreign Direct Investment (FDI) estimated at over $8 billion and contribute significantly to reduction of flared gas, while further monetising Nigeria’s gas resources and improving the country’s revenue profile.
“From the stand point of employment generation: Train 7 will provide about 10,000 jobs for Nigerians, and particularly the youths in the Niger Delta. Since it opened shop in Bonny, Nigeria LNG Limited has provided more than 2,000 jobs each construction year and 18,000 jobs at the peak of construction. The sequential nature of the project ensures that labour force is retained over the years.”
The Managing Director of the company, Mr. Babs Omotowa, in his welcome address, said the NLNG Ltd was the fastest growing industry in sub-Saharan Africa.
According to him, “Nigeria LNG’s current 6-train facility has a capacity for 22mtpa of LNG, and up to 5mtpa of Natural Gas Liquids (NGL). The company has rapidly grown from its well-earned reputation as the world’s fastest growing LNG plant to a stable production operation with buyers across the Atlantic Basin and Asia Pacific regions, sending one cargo of LNG everyday down the Bonny River to buyers all over the world safely, timely.
NLNG currently accounts for eight per cent of the global LNG supplies; it used to be 10 per cent!“Since October 1999 when the first LNG cargo was loaded for delivery in France and following a Final Investment Decision by the shareholders in November 1995, Nigeria LNG Limited has brought significant value to Nigeria. In line with government’s vision of generating as much revenue from gas as from oil, NLNG has successfully pioneered gas monetisation.
It is the most significant arrow-head in government’s quest to end gas flaring in the country with the attendant environmental benefits. It is also the biggest single contributor to government’s efforts to diversify the Nigerian economy and income portfolio.
“The Nigerian government has reaped over $9 billion in dividends from Nigeria LNG Limited from 2004 to date. The project today has assets worth over $13 billion. 49% of this belongs to the country through the Nigerian National Petroleum Corporation, NNPC. The company contributes – in revenue terms – over $9 billion yearly to the national GDP.”