By Paul Williams
Nigeria’s international gas company, NLNG says it has signed long-term Gas Supply Agreements (GSAs) with six third-party suppliers in a bid to strengthen feedgas supply to its trains on Bonny Island.
The move, according to a release by the company’s General Manager, External Relations and Sustainable Development, Sophia Horsfall, also supports NLNG’s expansion drive.
The long-term agreements, with options for extension, were signed with SNEPCO-SUNLINK HI project, TEPNG AMNI JV IMA project, NNPCL-First E&P JV, SNG NGML, OANDO- NNPC E&P, and TEPNG JV Ubeta.
The suppliers are expected to deliver an estimated 1,290 million standard cubic feet per day (mmscf/d) or 13.3 bcm/yr of feedgas to NLNG, which volumes will be gradually scaled up over a period of time.
The release further said the new GSAs “represent a significant boost to feedgas availability, enhancing NLNG’s capacity to meet its commercial commitments while laying the groundwork for expansion.
“This development is aligned with the Federal Government’s Decade of Gas initiative, which places natural gas at the centre of Nigeria’s industrialisation and energy transition agenda,” Horsfall said.
NLNG’s Managing Director and Chief Executive Officer, Philip Mshelbila, described the agreements as a milestone and the culmination of sustained efforts by shareholders and stakeholders to address long-standing gas supply constraints.
He noted that in recent years, NLNG’s operations had been significantly impacted by pipeline disruptions, including vandalism and sabotage, affecting upstream gas availability.
“NLNG recognises the challenges that the consequent insufficiency of gas supply has caused to its long term buyers, customers, shareholders and more widely to the Nigerian economy.
“With the new GSAs, NLNG is optimistic of sustainable gas supply for the future and remains grateful for the continuing support of its buyers and other stakeholders, and looks forward to a successful future together.
“We could not have achieved this without the deliberate and concerted efforts of our shareholders and stakeholders in the energy industry in Nigeria. These agreements are a turning point in NLNG’s journey, restoring reliability of supply and ensuring we remain firmly on the path of growth and expansion,” Mshelbila said.
The managing director further explained that the new GSAs mark a historic shift for NLNG, which since inception had relied primarily on legacy shareholder joint venture affiliates for gas supply.
He said with the recent divestment of onshore assets by several International Oil Companies (IOCs) to non-shareholder entities, NLNG is now procuring feedgas from diverse third-party suppliers to meet its growing needs for both Liquefied Natural Gas (LNG) and Natural Gas Liquids (NGLs) production.
The GSAs are a game-changer for Nigeria’s gas industry, enhancing local gas production capacity and improving gas supply, which are critical to the country’s energy security, industrialisation aspirations, and economic growth.
