NNPCL Seals 10-Year Gas Supply Deal With Dangote Refinery

Posted by African Examiner Business News, Latest Headlines Thursday, November 14th, 2024

(AFRICAN EXAMINER) – The Nigerian National Petroleum Company (NNPC) Limited has announced that subsidiary, the NNPC Gas Marketing Limited (NGML), has successfully executed a Gas Sale and Purchase Agreement (GSPA) with Dangote Petroleum Refinery and Petrochemicals FZE.

This was disclosed in a statement signed by the Chief Corporate Communications Officer of the NNPLC, Olufemi Soneye, on Wednesday.

He said the agreement, signed by the Managing Director, NGML, Barr. Justin Ezeala and the President/CEO of the Dangote Group, Aliko Dangote on Tuesday at the Corporate Head Office of Dangote in Falomo, Lagos State, outlines the supply of natural gas for power generation and feedstock at the Dangote Refinery, in Ibeju-Lekki, Lagos State.

This major milestone, according to Soneye, is in line with President Bola Ahmed Tinubu’s policy of utilizing Nigeria’s abundant gas resources towards revamping the nation’s industrial growth and kickstarting its economic prosperity.

He added that the development, which sees a huge investment of this nature penned with zero capital expenditure (CAPEX) outlay, has been described by many as unprecedented in the history of NGML or any gas Local Distribution Company (LDC) in the country.

Under the terms of the agreement, NGML will supply 100 million standard cubic feet per day (MMSCF/D), 50MMSCF/D being firm supply and the rest 50MMSCF/D, interruptible natural gas supply to the refinery for an initial period of 10 years, with options for renewal and growth.

According to the NNPCL, the collaboration is a significant step toward ensuring the operational success of the Dangote Refinery and enhancing Nigeria’s domestic gas utilization.

“The agreement represents a milestone for both NNPC Ltd. and Dangote Refinery, aligning with their shared commitment to boosting local production and providing vital products for the benefit of all Nigerians.

“It is also a further proof of NGML’s unwavering commitment to business excellence and fulfilling NNPC Ltd.’s core mandate of ensuring Nigeria’s energy security through the execution of strategic gas projects across the country,”the statement added.