China Restates Commitment to Provide 85% Funding for $2.8bn AKK Gas Line Project
Chineme Okafor in Abuja
The Nigerian National Petroleum Corporation (NNPC) has been assured by China National Petroleum Corporation (CNPC) that it is committed to helping it secure up to 85 per cent of $2.8 billion it requires to build the Ajaokuta-Kaduna-Kano (AKK) pipeline project, a statement from the corporation on Monday disclosed.
The statement which was signed by the Group General Manager, Public Affairs of the NNPC, Mr. Ndu Ughamadu, and sent to THISDAY in Abuja, explained that the Group Managing Director of NNPC, Dr. Maikanti Baru, got the assurance from CNPC during a high-level meeting between both corporations.
It stated the meeting was held on the sidelines of the ongoing Forum on China-Africa Cooperation (FOCAC) Summit in Beijing, China.
According to it, the AKK gas pipeline would enable connectivity between the East, West and North that is currently non-existent. It would also enable gas supply and utilisation to key commercial centres in the northern corridor of Nigeria with the attendant positive spin-off on power generation and industrial growth.
The statement also added that financing for the 40-inch by 614 kilometres (km)AKK gas pipeline is expected to cost about $2.8 billion, and 85 per cent of the money is expected to be funded by the financiers which include Industrial and Commercial Bank of China (ICBC), Bank of China, and Infrastructure Bank of China with Sinosure, China’s Export Credit Agency (ECA), providing insurance cover, while the remaining 15per cent will be provided by the contractors which include Oilserve/Oando consortium, as well as Brentex/China Petroleum Pipeline (CPP) Bureau consortium.
It quoted the Assistant President and Board Member of the CNPC, Mr. Wang Shihong, to have said his compnay placed a very high premium on the AKK project.
“We are in full support of Nigeria’s quest to deliver the AKK project. We are working relentlessly towards securing funding for the project based on regulations and policies of Chinese financial institutions,” Shihong stated in the statement.
Shihong, also said that the CNPC cherished its relationship with the NNPC, and pledged to fully support his company’s subsidiary, CPP Bureau, partner in the AKK project, to ensure success of the initiative.
It added that Baru in his response, stated that the AKK project was dear to Nigeria, and that while at the FOCAC Summit, President Muhammadu Buhari reiterated the potentials of the project to strengthen Nigeria-China relations.
He explained the NNPC was looking forward to a successful close-out of the project’s financing towards official groundbreaking ceremony in October, this year.
“We want to maximise the construction work before the end of the year. We are hoping for the quick resolution of the financing agreements so that we will kick-start the project in October, when the dry season begins,” Baru said.