NNPC teams up with Nigerian company to reduce cooking gas prices, employ 7,000

The Nigerian National Petroleum Company (NNPC) Ltd. and UTM Offshore Ltd. has signed the Heads of Terms Agreement to provide clean energy to Nigerians through the UTM FLNG Project, which aims to ensure the accessibility and affordability of cooking gas for consumers.

The signing ceremony was regarded as a significant step towards growing the gas market and allows 20 per cent equity contribution of the NNPCL in the UTM FLNG Project, The Nation reported.

Julius Rone, Group Managing Director, UTM Offshore Ltd said the development is part of the joint effort to stabilize the cost of gas and also create a healthy environment.

He said the project will attract investment and 7,000 direct and indirect job opportunities and overall, enhance economy and well-being of citizens.

Never miss important updates! Why the project is important Rone said the project when completed will have the capacity to produce 1.7mmtpa of LNG and 300,000 metric tons of LPG (cooking gas) which will be made available in the domestic market.

With JGC, Technip and indigenous companies acting as consultants, he revealed that the Front-End Engineering Design (FEED), is already on in Lagos preparing ahead for budget and planning for final investment decisions which will be taken in the last quarter of the year planned project start-up in the fourth quarter of 2026.

The project according to Rone will cause a reduction in the price of cooking as well as reduce deforestation and improve socio-economic wellbeing of Nigerians.

In addition to this, he said the project will directly employ 3,000 Nigerians and indirectly employ another 4,000 people.

Rone stated that the facility will be located about 60km offshore at 64m water depth with the aid of JGC of Japan and Technip of France and KBR as the Owners Engineer as the contracting companies with history of building the six existing LNG Trains for Nigerian LNG Ltd.

He said the first outcome (Level four) is already done and they are expecting to complete the remaining from level four to level three, adding that the Engineering Procurement and Construction draft contract is being worked with Templers, UTMOL’s lawyers and their international counsel, White and Case.

When discussing the connection with the NNPCL, he stated that the goal was to finish the FEED by October 2023 and to start working on the Open Book Estimate for the EPC contract in November.

Mele Kyari, the group CEO of NNPCL, expressed excitement about the project and characterized it as being of the utmost importance to the country.

He said: No matter the amount of reserves you have underground, if you haven’t brought it up to the surface, you have done nothing.