By Firdaus Jibril
Nigeria’s first floating liquefied natural gas (FLNG) project could reach a major investment milestone in September, as UTM Offshore prepares to take a final investment decision on the estimated $3 billion facility.
UTM Offshore Group Managing Director, Julius Rone, stated that the company is targeting September for the decision, which would clear the way for the project to progress toward construction.
The FLNG facility is expected to process gas from the Yoho field offshore Nigeria and produce about 1.8 million tonnes of LNG annually. It is also designed to produce LPG for the domestic market.
The project recently met a key requirement after UTM Offshore signed a 15-year gas supply agreement with the NNPC-Seplat joint venture.
Under the agreement, the joint venture is expected to supply about 200 million standard cubic feet of gas daily to the FLNG project.
The gas supply arrangement will provide the feedstock needed for the facility while UTM continues work on other commercial arrangements ahead of the investment decision.
Rone disclosed the September target during an interview with CNBC Africa.
UTM Offshore holds a 72 percent interest in UTM FLNG Limited, while NNPC Limited owns 20 percent and the Delta State Government holds eight percent.
The project is expected to strengthen Nigeria’s gas monetization efforts by converting offshore gas resources into LNG for export, while also providing LPG for the local market.
UTM has previously stated that it expects the project to begin producing LNG by 2030.