· $3.6Bn fresh investment coming
· $7Bn investment may follow from India
· 55,000 jobs to be created
By Ignatius Chukwu
Indorama-Nigeria may be leading a charge for industrial prosperity in the Niger Delta and for Nigeria.
This new charge may spring from their entry into gas value chain especially production of estimated 800mcfg in partnership with the Nigeria National Petroleum Company Limited.
The deal with the NNPCL may have also found solution to the inadequate supply of gas feedstock to its plants in Eleme, near Port Harcourt.
The deal make Indorama draw as much as they would want from new gas source.
For over two years, Indorama in Eleme and other industry players are said to be having gas scarcity challenges.
This situation is said to be made worse by the exit of Agip, a major player in the gas value chain who supplied many industries, who just sold off its assets to another player.
Many industrial ventures are known to have shut down due to absence of gas, leading to skyrocketing prices of domestic gas, a commodity Nigeria has in huge abundance. It has driven many homes back to firewood.
If Indorama-Nigeria solves this problem, they would have added another feather.
The company had also solved one of Nigeria’s biggest failures in industries, inability to carry out turn-around-maintenance (TAM) in government-owned plants. This breakthrough in Indorama has made the petrochemicals plant and other plants to run seamlessly from year to year.
Speaking on the deal with the NNPCL, the Corporate Affairs Manager at Indorama-Nigeria, Dr Jossy Nkwocha, said: “The partnership with the NNPCL will have multiplier effect on several sectors of the Nigerian economy and impact significantly on gas supply and pricing mechanisms. In general, the agreement by the NNPLC and Indorama-Nigeria will bring humongous effect on the wellbeing of Nigerians, on industrialization in the country and the general economy”.
An independent source told newsmen in Port Harcourt that going by the steady efficiency and successful processes by Indorama-Nigeria plants in Eleme, their entry into gas would be a game-changer.
Other experts in the oil region say they are excited at the number of jobs (55,000) likely to be created from this project.
The news of the NNPCL and Indorama Eleme Petrochemicals Ltd signing a Memorandum of Understanding (MOU) to explore and develop suitable opportunities within the remits of both parties’ interests across the hydrocarbon value chain in Nigeria made waves around Nigeria.
Already, the NNPCL’s group CEO, Mele Kyari, said NNPCL is on the threshold of making value out of gas beyond any imagination.
He said as the national energy company, one of NNPCL’s roles as enshrined in article 64(i) of the Petroleum Industry Act (PIA) is to promote the use of natural gas through the development and operation of large-scale gas utilisation industries.
He said this role is in alignment with Nigeria’s Nigasification strategy which is a consolidation of critical programmes embarked upon by the company to utilise natural gas and its associated liquids to be the energy source of choice, spur economic growth, free up crude oil for exports, and ultimately enable job creation.
According to NNPCL’s GCEO, with this project, “We are seeing an annual contribution of $3bn to the nation’s GDP and a lifetime contribution of $18bn to government revenue.”
As part of the company’s vision of operating the largest petrochemical hub in Africa, Indorama which owns the world’s largest single-train urea plant located in Port Harcourt, Nigeria, is currently working on expansion plans within the next six years, in the gas-based heavy manufacturing industries including fertilizer, methanol, and petrochemicals.
In his remarks, the MD/CEO, Africa Indorama Energy, Manish Mundra, stated thus: “This is a strategic collaboration to unlock Nigeria’s upstream sector, but more importantly, to partner downstream, in order to share the value chain.”
He said that “Nigeria’s gas reserves should position the country as one of the largest producers of urea in the western hemisphere.”
Key benefits of the opportunities were listed as the monetization of over 1.7 tcf of gas and 100 million barrels of oil reserves, generation of upstream lifecycle revenue of over $18bn, downstream production of about 4.8 million tonnes per annum (MTPA) of products including methanol, urea, and fertilizer to boost national food security.
Other benefits include the creation of about 55,000 direct and indirect employment opportunities, the development of a condensate refinery to boost petroleum product supply and reduce product importation, annual GDP contribution of over $3.8bn, and attraction of over $7bn of foreign direct investment into the country.
The NNPCL MOU with Indorama, according to a statement released in Abuja by Garba Deen Muhammad, Chief Corporate Communications Officer of the NNPCL, follows Nigeria’s President Bola Ahmed Tinubu’s commitment in India a few weeks ago, to strengthen business relations between both countries.
Indorama-Nigeria waves a model many have demanded to be an industry blueprint because the ownership structure gives 7.5 per cent equity to the host community and 2.5 per cent to the workers.
