The Joint Venture (JV) partnership between Nigerian National Petroleum Corporation (NNPC) and Sahara Group, a leading energy conglomerate, to supply Liquefied Petroleum Gas (LPG), to the West African sub-region is a major step to diversify the nation’s economy. It also heralds the beginning of the end of scarcity of the commodity in Nigeria. Bamidele Famoofo writes
About five years ago, the Nigerian National Petroleum Corporation (NNPC), entered into a joint venture agreement with Sahara Group, a foremost indigenous energy conglomerate in Nigeria to explore the opportunities in Liquefied Petroleum Gas (LPG) sector of the oil and gas industry.
Group Managing Director of NNPC, Dr. Maikanti Baru, said the joint venture partnership, which the NNPC entered into with Sahara Group in 2013,has already started yielding fruit. Baru said the relationship was beginning to record success in a very short period. The main driver of the partnership, according to him, was to boost the availability of the commodity in Nigeria and the West African sub-region.
The NNPC boss added that the partnership would address the lingering challenges of supply, affordability and fraudulent activities of individuals and organisations seeking to adulterate cooking gas due to scarce supply.
For the Managing Director of West Africa Gas Limited, Roland Omoregbe, the partnership and the successes it has began to record, is a clear indication that the dream of the company to become a leading LNG supplier is on course.
West African Gas was incorporated in March 2013 as a Joint Venture Company of Nigerian National Petroleum Corporation LNG Ltd , a wholly owned subsidiary of Nigerian National Petroleum Corporation (NNPC), and Ocean Bed Trading Ltd, an established oil and gas trading Company.
According to information made available on the company’s website, WAGL was established to primarily serve as a vehicle for off-take, marketing and trading of NLNG NGLs under the equity lifting scheme. Its strategy leverages the long term NGLs trading experience and expertise of its Joint Venture partners, particularly: Ocean Bed Trading Ltd.
With a focus in trading NGLs, the company would seek to maximise value from the market whilst leveraging on its vast resource base.
To formally launch the business partnership and to commence the business of gas supply as planned, WAGL, in January 2017, acquired two new vessels, MT Africa Gas and MT Sahara Gas. The management of WAGL said the acquisitions were in its bid to reduce transportation bottlenecks, add value to the Nigeria economy through exporting the commodity. It says it would deepen the LPG market in West Africa as well as enhance access to clean and safe energy.
“The acquisitions were also a strategic response to the lingering challenges of supply, affordability and fraudulent activities motivated by scarcity of the product”, the company said.
While speaking at the inauguration of the LPG vessels in South Korea, the NNPC boss said it was “an outstanding achievement” for Nigeria considering the fact “that the Joint Venture between NNPC and Sahara is already recording success stories within a short period having been established in 2013.” Baru said the NNPC remained committed to ensuring uninterrupted supply of cooking gas as well as the adoption of policies to drive sustainable development across the entire energy value-chain of the nation’s oil and gas sector
MT Africa Gas, one of the two Liquefied Petroleum Gas vessels ordered and completed by West Africa Gas Limited (WAGL), delivered its first cargo of 9,000 metric tonnes of gas to Ghana.
MT Africa Gas is to deliver 180,000 standard cubic feet of gas as works at the Tema Port to receive first gas for the thermal plants in Tema energy enclave is underway.
This was disclosed at a media tour of the facility at Tema port when the vessel ordered at Hyundai Mipo Shipyard in South Korea in 2014 docked at Tema.
Managing Director of the company, Roland Omoreegbe, who could not hide his excitement about the arrival of the vessel said the company’s dream of being a leading LNG supplier is on course.
“This is the first of its kind by any energy company and this feat will help them serve consumers in Africa and beyond,” Omoregbe disclosed.
Captain of MT Africa Gas vessel, Sergejs Tihomirovs, said the vessel could carry both butane and propane. The capacity for both vessels is 38,000 cubic meters (cbm).
MT Sahara Gas, the newly built vessel of the West Africa Gas Limited (WAGL) recently delivered another 7,000 metric tons of Liquefied Natural Gas (LPG) in its historic maiden voyage to Nigeria to boost availability and safe access to the commodity widely referred to as cooking gas.
Commenting on the delivery, Baru said, “This is a historic achievement for the NNPC and Sahara Group that showcases a truly successful partnership by all global standards. The quest is to achieve uninterrupted supply of the commodity and address infrastructural limitations as we continue to implement our zero tolerance policy against adulterated products and their promoters across the nation.”
Baru added that the NNPC/Sahara Group partnership remained a model for successful JVs, adding that both parties were considering various strategies to optimise the delivery of the product across West Africa. “The federal government deserves commendation for implementing policies that are geared towards growing the economy. That we have such a partnership involving the NNPC and Sahara Group is indeed an important global narrative for Nigeria in terms of capacity, expertise and sustainability,” he noted.
Speaking aboard the vessel, Managing Director, Petroleum Products Marketing Company (PPMC), Umar Isa Ajiya, said it was a significant and important milestone not only for Nigeria, Africa and the entire shipping and maritime industry. “We have a brand new LPG vessel, built by 100 per cent fully-owned Nigerian entities and it has picked up LPG from Bonny and brought it to Lagos. This is the first time we are having a wholly-owned shipping vessel bringing product to our shores. This is an opportunity to grow and deepen the LPG market in Nigeria such that the use of firewood will come to an end sooner than later. I must commend the shareholders of Sahara Group and NNPC for making it worthy to make this laudable investment,” he said.
Also commending the NNPC/Sahara Group Partnership, Omoreegbe said: “This is the first time the private sector in Nigeria is involved with the NNPC in ensuring that there is enough supply of LPG to the country. We are happy that it has done several voyages into West Africa, including Lome, Ivory Coast and Ghana and we are counting more. The sister vessel, Africa Gas is in the West Africa waters as we speak. We have strategic plans to flood Nigeria with LPG and other cleaner sources of energy to do their domestic chores which will in turn save our country and our planet.”
Chief Executive Officer, Asharami Synergy (A Sahara Group Downstream Company), Moroti Adedoyin-Adeyinka, said: “What we see here today speaks to the power of collaboration and the great things that can be achieved when the private and public sector work together with the right strategy, expertise and capacity. At Sahara, this is the kind of collaboration that we push for; one that makes our economy better and saves our planet.”
LPG/C Africa Gas has performed five transatlantic voyages loading butane from US Gulf Coast and discharging in West Africa mainly in Abidjan, Tema and Lome. The vessel also traded once in South America for a spot voyage in September 2017. LPG/C Sahara Gas has performed four Trans-Atlantic Voyages around the West African region, with her berthing in Lagos, being her first trade in Nigeria, after it loaded from Bonny and discharged in Lagos. Sahara Gas also had a spot trade in France in April 2017.
Total volumes traded by both vessels include: 150,000 MT in Abidjan, Cote d’Ivoire, 35,000 MT in Tema, Ghana, 2,500 MT in Lome, Togo, and the recently delivered 7,000 MT in Lagos, Nigeria. “Africa Gas is currently discharging in Abidjan and heads out to Tema, Ghana and Lome, Togo in a fortnight,” a source close to the deal disclosed.