Shell confirms viability of Nigeria’s OKLNG project

30 May 2012, Sweetcrude, ABUJA - The Royal Dutch Shell has confirmed the viability of Nigeria’s multi-billion dollars Olokola Liquefied Natural Gas (OKLNG) project.

The Shell Global Solutions International (SGSI), a world leader in LNG technology, marketing and investment consultancy, says the Olokola LNG is a sound project with good fundamentals capable of taking advantage of world LNG market opportunities in year 2018.

Dr Levi Ajuonuma, Group General Manager Public Affairs at the Nigerian National Petroleum Corporation (NNPC) – a partner in the project – disclosed this, saying everything was being done to ensure the success of the project and entrench Nigeria as a regional hub for gas.

He said SGSI came up with this verdict after an in depth strategic review on how best to progress the project into implementations.

According to him, the SGSI position is a vote of confidence on the project against the backdrop of the withdrawal of the smallest shareholder, the BG Group, from the project.

But, Ajuonuma said BG Group’s withdrawal did not come as a surprise considering that the company had been engaging NNPC on disposing of its upstream assets in the country.

“BG’s withdrawal is consistent with earlier engagements it has had with NNPC and it will not in any way affect the project negatively as other shareholders will either exercise their right to take up the shares or allow any of the numerous investors angling to get on board to buy the shares,” he said.

He listed some of the companies willing to come on board the project to include Centrica, LNG Japan and Mittal Group.

The OKLNG project was established in 2005 with NNPC as the major shareholder with 46.75% shareholding, Shell and Chevron 19.5% each, and the BG Group 14.25%.

The project has since accomplished Front End Engineering Design, and concluded initial work on gas supply, financing and resettlement action plan.

President Goodluck Jonathan recently commissioned the camp from where the first set of construction staff of the project will operate.