NNPC to partner China on $2.5bn gas pipeline deal

By Olawale Ajayi

Nigerian National Petroleum Corporation (NNPC), through the Group Managing Director (GMD) Mr. Mele Kyari has said that the corporation is about to reach an agreement in securing a $2.5billion gas pipeline financing with China.

Kyari made this known while speaking with the Bloomberg in the World Energy Conference in Abu Dabhi in Saudi Arabia, noted that the parties are closed to secure the deal.

According to him a successful negotiation of the deal which could run for about 6 months will allow NNPC to supply 2billion standard cubic feet of gas (SCUF) for 2,600mw to China.

“What we did is to get a long conversation with the Chinese. We are very close to closure. We have secured 15 per cent financing in our account. We are expecting closure of 85 per cent, $2.5billion.”

“As you have mentioned, this project will deliver 2,600mw of power. Also, supply copper gas. That is quite significant in the context of our situation.

“Giving his comments on the ongoing discussions about building the gas pipeline in Nigeria, Kyari said “Because of issues of the fiscal environment which is uncertain, it has kind of stalled the process”, he said.

He added that the NNPC has been very close to the Chinese in order to collaborate to open fresh opportunities.

Commenting on the recent OPEC quota cut, the NNPC chief said that 50 percent that is equivalent to 5million barrel is quite significant.

According to him, the cut could become an enormous challenge in the oil market.

“50 per cent or 5million barrels is quite significant. I know they are still trying to figure out exactly what happened. When the closure is on that, we will be in a position to comment fully. It can be a big challenge for the oil market”, Kyari said.