The Federal Government lost around $60 million to the recent closure of the Nigeria Liquefied Natural Gas (NLNG) plant in Bonny, Rivers State, over power outage, THISDAY has learnt.

NLNG, the worlds third largest supplier of gas to the European market, and which also accounts for 10 per cent of global LNG supply to the international market, was shut down on December 22, 2010, after a power outage at the facility.

Though the plant resumed skeletal operation at the weekend, a top official of the company told THISDAY at the weekend that the Federal Government lost about $60 million in revenue to the temporary shutdown.

With the global recession in gas market, the revenue loss was about $60 million. Each of the four cargoes is $15 million. The figure would have been much higher, he said.

The Bonny Island plant supply gas to mostly European customers including Gas Natural of Spain, BOTAS of Turkey, Gaz de France and TransGas of Portugal.

A spokesman for the company had confirmed the resumption of operation at the weekend, adding that the plant would resume normal operation this week. With 22 million tonnes a year production from the plant, Nigeria is the seventh largest LNG supplier.

NLNG Limited runs the plant, which is owned by Nigerian National Petroleum Corporation (NNPC) with 49 per cent interest; Shell, 25.6 per cent; Total 15 per cent and Eni 10.4 per cent.

Its biggest customer is Italian electric power giant, ENEL, which agreed to buy 3.5 billion cubic metres (bcm) of LNG per annum for 22 years.

Under the sale and purchase agreement signed in June 1998 with TransGas of Portugal, NLNG will supply 0.35 billion cubic metres of liquified natural gas annually to TransGas via the receiving facilities of ENAGAS in Spain.

This is being transported by pipeline to Portugal, with the commencement of delivery at the start up of the plant in the last quarter of 1999.

The company currently operates six production trains, but shareholders in the project plan to build a seventh train as part of efforts by the government to ensure that revenue from gas matches that of oil. The sixth train currently produces about 3.4 million mt/year of liquefied petroleum gas.

Officials say government will earn around $1 billion per annum in revenue from gas exports if a seventh train comes on stream.

The NLNGs current gas export revenue represents about 7 per cent of the country’s Gross Domestic Product (GDP).

The plant had suffered previous shutdown when Shell’s Soku Gas plant located at Akuku-Toru Local Government Area of Rivers State was shut down in November 2008. Soku Gas plant supplies 40 per cent of the total gas need of the NLNG.

– ThisDay

Posted by admin on Jan 4 2011. Filed under Latest Politics. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry