By Ejiofor  Alike

Nigeria’s oil and gas industry is set to record another milestone as the $3.3 billion Floating Production Storage Offloading (FPSO) vessel for the 200,000 barrels per day capacity Egina Deepwater oilfield will arrive Nigeria from South Korea on Tuesday.

The FPSO, which was built by Samsung Heavy Industries (SHI), sailed away from the quay side at Samsung Yard in Geoje, South Korea, on October 31, 2017, on its long anticipated journey to Nigeria, which was initially estimated to last for 90 days.

THISDAY gathered that when it arrives at the Samsung Yard (SHI-MCI FZE quayside) in Lagos on Tuesday, the FPSO, which is currently offshore Angola, will be integrated locally before it sails away to the deep offshore oil field.

Located at the Oil Mining Lease (OML) 130 offshore, the Egina oilfield, which will add 200,000 barrels per day of crude oil to Nigeria’s daily production when it comes on stream by the end of 2018, is being developed by Total Upstream Nigeria Limited (TUPNL) at the cost of $16 billion.

Out of the $16 billion capital expenditure (Capex) for the six packages in the oilfield development, $3.3 billion of this amount is earmarked for building the FPSO.

Speaking to journalists yesterday at the Samsung’s fabrication and integration yard located at LADOL Free Zone in Lagos, the Chief Financial Officer of SHI-MCI, Mr. Jin Su Park stated that the FPSO will arrive Nigeria by 7a.m on January 23, 2017.

He noted that despite the numerous challenges that confronted SHI in the construction of the yard, the South Korean firm had successfully completed the yard, which is the first FPSO fabrication and integration yard in Africa.

According to him, Samsung Heavy Industries invested $300 million in the yard and achieved 777 days without Loss Time Injury (LTI) on January 19, being yesterday.

Park stated that Samsung Heavy Industries owns 70 per cent stake in a joint venture with LADOL, which owns 30 per cent stake.

He added that out of the 18 modules in the Egina FPSO, six modules were fabricated in the SHI-MCI yard, which represents 30 per cent of the entire FPSO.

“The FPSO will arrive by 7a.m on January 23. The SHI-MCI was founded in July 2014 and groundbreaking was performed in August 2014. The steel cutting for the Egina FPSO started in June 2015. The fabrication yard was completed also June 2015, while the fabrication of the six modules was completed in April 2017. When the FPSO arrives the yard, it will be integrated,” Park explained.

 Park also disclosed that the fabrication of the yard’s 5,000 tonnes-capacity crane, which is the biggest in Africa, was completed in October 2017.

Park decried what he described as exorbitant, rental fees paid by Samsung for the project, saying the high fees hamper the ease of doing business in the country.

 “Fixed costs incurred by Samsung in the project are higher than that of any other company. The government has to improve the ease of doing business by reducing the excessive bureaucracy. 

The rental fees for the yard are excessively high and this will make it difficult for SHI to compete favourably with other companies,” Park added.

Total awarded the FPSO contract to SHI in 2014 after the Korean firm emerged the winner, following a rigorous tendering process.

The Egina FPSO is the first to be integrated in Nigeria, and indeed, Africa.