DPR Issues Licence for Ajaokuta LNG Project

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Peter Uzoho

Axxela Limited, a gas and power portfolio company, has announced that the Department of Petroleum Resources (DPR) has issued a Licence to Establish (LTE) for the Liquefied Natural Gas (LNG) facility in Ajaokuta, Kogi State.

Axxela, in a statement, explained that the LNG project was being developed via a joint venture between its subsidiary, Transit Gas Nigeria Limited, and Nigerian Gas Marketing Company (NGMC), a subsidiary of the Nigerian National Petroleum Corporation (NNPC).

It added that the Federal Ministry of Environment had also approved the project’s Environmental and Social Impact Assessment (ESIA).

It also stressed that the DPR’s issuance of the LTE and the Federal Ministry of Environment’s ESIA approval were significant project milestones demonstrating the critical regulatory support for the LNG facility development.

Axxela, however, noted that the project would be fast-tracked to ensure timely completion as it recently received a Gas Purchase Order (GPO) for its feed gas from the Gas Aggregation Company of Nigeria (GACN).   

Axxela said: “NGMC and Transit Gas have adopted a world-class development approach in collaborating with a global team of experienced Engineering, Procurement and Construction (EPC) contractors, technology providers, and other professionals to ensure project delivery in accordance with international best practices and safety standards.   

“The establishment of the LNG facility in the strategically located industrial hub of Ajaokuta, will assure the safe supply of natural gas in liquefied form via specialised cryogenic trucks across Nigeria.

“The largest block of beneficiaries are commercial and industrial businesses in the Northern part of the country which have been considered stranded so far due to the absence of gas pipeline infrastructure.

“LNG is an environmentally-friendly fuel for power, process and feedstock needs that provides up to 40 percent in cost savings compared to alternative liquid fuels such as diesel. Continuous and reliable supply of gas is guaranteed by the installation of storage facilities at customer locations in addition to the buffer storage at the main LNG facility. 

“The project is expected to be completed and market-ready by 2020, thus boosting productivity of existing industries, attracting new investments into the country, creating jobs for Nigeria’s growing populace and advancing the government’s push for socio-economic resurgence across the country”.  

NGMC and Gaslink, another subsidiary of Axxela, account for over 80 per cent of the domestic gas distribution to industrial and commercial concerns, and have been doing so for the past 20 years.