NLNG signs contracts with SCD JV Consortium for $12bn Train-7 project construction

By Obas Esiedesa

The Nigeria LNG Limited (NLNG) has signed the Engineering, Procurement and Construction (EPC) Contracts for its multi-billion dollars Train 7 Project with the SCD JV Consortium, comprising affiliates of Saipem, Chiyoda and Daewoo.

The project which will take about 60 months to construct will cost about $12 billion.

NLNG is an incorporated Joint-Venture owned by four Shareholders, namely, the Federal Government of Nigeria, represented by Nigerian National Petroleum Corporation (49%), Shell Gas B.V. (25.6%), Total GazElectricite Holdings France (15%), and Eni International N.A. N.V. S.àr.l (10.4%).

The execution of the EPC Contracts now triggers the commencement of the Detail Design and Construction phase of the Project expected to increase the capacity of NLNG’s current six-train plant by 35% from the extant 22 Million Tonnes Per Annum (MTPA) to 30 MTPA.

NLNG CEO, Engr. Tony Attah who disclosed this at Zoom conference on Wednesday with all the companies and government agencies involved in the project including the Minister of State Petroleum Resources said EPC Contracts represents yet another milestone in NLNG’s journey towards achieving its vision of being a global LNG company, helping to build a better Nigeria.

According to him, “With the award of the EPC Contracts to our preferred bidders (SCD JV), we are guaranteeing that our country remains significantly on the global list of LNG suppliers. This singular act clearly demonstrates our Shareholders’ determination and resolve to sustain the economic dividends that NLNG’s monetization of our vast natural gas reserves offers our great country Nigeria”

Attah expressed confidence in SCD JV Consortium’s proven competence, adding that the demonstration of an understanding of NLNG’s business philosophy by the Consortium will positively influence the execution of the Project and ensure zero harm to people, environment and host communities.

He said the decision by the NLNG shareholders to the Final Investment Decision (FID) in December last year, “renewed our hope that NLNG will continue to maintain a significant share in the global gas market and continue to reap the potential benefits in the market because Nigeria is a gas nation”.

He praised the Nigerian Content Development and Monitoring Board (NCDMB) for making the project possible by working with NLNG on the local content part of the project.

In his remarks, Chief Sylva congratulated the companies involved for the achievement, assuring that the government would provided the required support to ensure that the construction is concluded as scheduled.

Also, the Group Managing Director (NNPC) and a Director on the NLNG Board, Mr. Mele Kyari, remarked on NLNG’s successes and its operating model. He said: “Nigeria LNG’s successes since it started operation in 1999 continue to prove that the company operates a unique business model that is profitable to all its stakeholders. NNPC and the other Shareholders — Shell, Total and Eni — are proud to be a part of this exceptional Nigerian brand that stands out in the global market.”

“It is for this reason that our President, Muhammadu Buhari instructed through the Honourable Minister of State for Petroleum Resources that NNPC as a Shareholder must do everything possible to support all the other Shareholders and NLNG’s Management to secure the much-needed public confidence from all critical stakeholders, especially the critical agencies of the Federal Government of Nigeria and international investors, to pursue the Company’s ambition of adding a 7th train to its existing production capacity.

“I encourage every stakeholder involved in execution of the Train 7 Project, especially the SCD JV Consortium, NLNG Train 7 Project Team and the Company’s Management to leave no stone unturned in making this project a reality,” he added.

On his part, the Executive Secretary of NCDMB, Engr. Simbi Wabote said the project has broken the jinx of not having major investment decision in the sector in the past few years.

Wabote disclosed that the Train 7 project would attract huge direct foreign investment and stimulate the local economy.

According to him, “During construction, 55 percent of the engineering activities will be carried out in Nigeria, 55 percent of all procurements will be done by competent Nigerian vendors and 100 percent of the installations and construction of Train 7 will be executed in Nigeria.”

He expressed confidence in the capacity of Saipem, the lead contractor of the project, indicating that the company had made significant investments in Nigerian and had made long-time commitment to Local Content growth. “I hope that Saipem will not only strive to deliver on time and within budget, but also use this project to expand and strengthen local capabilities,” he said.

He said other Nigerian companies and community contractors awarded jobs based on their proven capacity would also be expected to deliver value and prove their mettle.

He observed that having most of the fabrication yards in the country without jobs was not a good thing.

“Empty fabrication yards, fields without rigs, vessels without contracts, and other low-level industry activities can be very depressing. We are really excited that the Train 7 project has brighten up our outlook of the industry”, he added.

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