NIPCO Group is considering a Floating Liquefied Natural Gas project in Nigeria that could require more than $3bn in investment, as the company evaluates opportunities to expand its participation in the country’s growing gas industry.
The proposed project was disclosed by NIPCO Group Managing Director, Nagendra Verma, at a press conference on Thursday. He said the development is envisaged to have an LNG production capacity of approximately three million tonnes per annum.
However, the project remains at the assessment stage and has not yet reached a final investment decision. NIPCO said feasibility studies, technical and commercial assessments, project economics and regulatory approvals will determine whether the development proceeds.
The company is considering potential locations around the Escravos area of Delta State and the Akwa Ibom region. According to Verma, the final location will depend partly on access to upstream gas resources, LNG processing facilities, marine transportation and both domestic and international markets.
The proposed development would include an FLNG facility as well as associated marine and export infrastructure. NIPCO said the project could supply LNG to international markets while also supporting Nigeria’s growing domestic demand for natural gas.
Verma said the company had been evaluating the project for between six and nine months and was examining different development concepts, technology options, financing structures and commercial models.
The assessment also covers upstream gas supply and reserves, FLNG technology and configuration, LNG production capacity, marine infrastructure, shipping and logistics, domestic gas opportunities and the overall economics of the project.
The proposed investment comes at a time when Nigeria is seeking to expand the use of natural gas as part of its industrial and economic development strategy. Federal authorities have increasingly emphasised the need to strengthen indigenous capacity across the gas value chain, including engineering, project execution, pipeline construction, fabrication, LNG and FLNG services.
NIPCO already has experience in Nigeria’s gas distribution market. NIPCO Gas says it has operated natural-gas distribution and mobility CNG businesses in the country and has been expanding its network across different states.
The proposed FLNG project would represent a significant expansion of NIPCO’s activities if it eventually receives the required approvals and investment commitment.
For now, the company is continuing its technical and commercial evaluations before making a final decision. The outcome of those studies will determine the project's final location, design, financing structure, investment requirements and implementation timeline.
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