ChevronTexaco and Phillips Petroleum along with Statoil and Agip have stepped up plans to build more Liquefied Natural Gas (LNG) plants in Nigeria. Sources at the Ministry of Petroleum Resources said ChevronTexaco and Phillips Petroleum as well as Statoil, have submitted proposals for the construction of the new LNG plants in the Niger Delta area. ChevronTexaco is handling the project named the West Niger Delta LNG, while Phillips Petroleum, in partnership with Agip, is working on the Brass LNG project. The source said that the ministry would soon sign a memorandum of understanding with Statoil.
It is estimated that the Phillips LNG project could cost as much as $1.5 billion for the production of five million tons of LNG per year and the joint venture plans to bring the plant on stream within the next 18 months. The ChevronTexaco's West Niger Delta LNG is expected to come on stream in 2008 with an annual production of nine million tons of LNG.
The floating of the LNG projects, according to industry sources, was a key strategy adopted by Agip, ChevronTexaco and Phillips, to end gas flaring from their oil fields. Nigeria, Africa's largest crude oil producer, currently flares more than 60 percent of gas produced along with oil. The Federal Government has set 2008 as target date for oil producing firms to end gas flaring in the country.
The Special Assistant to the President on Petroleum Matters, Engineer Funso Kupolokun, who confirmed on-going discussions on the three new LNG projects, said Nigeria was poised to begin to make "as much money from gas as we are making from oil. "First we want to flare down. It is no longer a question of flaring down or out, but of commercializing gas and making money from gas," Kupolokun said. Nigeria joined the league of big time exporters of natural gas in 1999 when the NLNG began exports of gas from the $3.8 billion Bonny LNG plant. Last year, the NLNG earned $1.2 billion revenue from the export of LNG to European markets.