NNPC Ltd Sets Sights on Reviving Brass and OK LNG Projects for National Economic Growth
In a significant move aimed at harnessing Nigeria’s abundant gas resources to drive economic development, the Nigerian National Petroleum Corporation Limited (NNPC Ltd) has initiated discussions with investors to revive two long-stalled Liquefied Natural Gas (LNG) projects: Brass LNG and Olokola (OK) LNG. This development marks a renewed commitment by NNPC Ltd to maximize the country’s natural gas potential for job creation, power generation, revenue growth, and broader economic diversification.
NNPC Ltd’s Chief Financial Officer (CFO), Mr. Umar Ajiya, made this announcement at the 2024 Gas Technology Conference and Exhibition (Gastech), which is currently taking place in Houston, Texas. Speaking on the sidelines of the global energy event, Ajiya outlined NNPC’s strategic intentions to bring both LNG projects back to life. Brass LNG and OK LNG, once seen as critical pillars in Nigeria’s efforts to tap into global gas markets, have languished in uncertainty due to a mix of unfavorable market conditions and political indecision.
“These projects have the potential to unlock enormous economic benefits for Nigeria, including job creation, power generation, substantial revenue inflow, and economic diversification,” Ajiya said. However, he explained that their development was previously stalled due to plunging global gas prices and the high capital expenditure (CAPEX) required to bring the projects to fruition, which acted as a deterrent to potential investors.
“The economics didn’t favor the projects in the past. When gas prices fell, coupled with the high CAPEX, it became less attractive for investors. In addition to that, there was slow decision-making by the political class, which delayed progress,” Ajiya elaborated.
Despite these setbacks, NNPC Ltd is now focused on repositioning itself as a commercially driven entity, with an emphasis on timely project execution. The CFO emphasized the urgency of making smart, swift decisions to attract partners, given the competitive nature of global gas markets.
“There are vast gas resources all over the world, and Nigeria needs to make timely decisions to bring investors to the table. The earlier we act, the better positioned we will be to capitalize on our resources,” Ajiya stated, underlining the importance of moving swiftly to avoid being left behind as other nations ramp up their own LNG capacities.
He credited the current administration under President Bola Ahmed Tinubu for its proactive stance in revitalizing the oil and gas industry. Ajiya highlighted the positive impact of the Presidential Executive Orders on Oil & Gas Reforms, which have set the stage for new projects and investments.
“We commend President Bola Tinubu for his continuous support in driving the energy sector forward. His reforms are creating new opportunities, and the Petroleum Industry Act (PIA) has provided the fiscal incentives that investors need. It has created an enabling environment that is restoring confidence in Nigeria’s energy sector,” Ajiya said.
The Petroleum Industry Act (PIA), which was passed into law in 2021, is widely regarded as a transformative piece of legislation that seeks to overhaul Nigeria’s oil and gas sector. Among its key provisions are fiscal and regulatory incentives designed to attract foreign and domestic investments in the sector. According to Ajiya, the PIA has been instrumental in rekindling investor interest in projects like Brass and OK LNG, which are now poised to become major contributors to Nigeria’s gas-led economic growth agenda.
In addition to promoting Nigeria’s LNG potential, NNPC Ltd is also focused on embracing new technologies to decarbonize its operations. Ajiya noted that events like Gastech provide valuable opportunities for NNPC to learn about innovative technologies and strategies that can help the company reduce its carbon footprint while promoting its LNG resources to global markets.
“Gastech is an important forum for us. It brings together experts and leaders in the energy sector to discuss how we can create pathways towards global energy security and lasting climate impact. For NNPC, it’s an opportunity to learn and adopt new technologies that will not only help us decarbonize our operations but also promote Nigeria’s vast LNG resources,” Ajiya explained.
The Gastech conference, recognized as the world’s leading forum dedicated to sustainable energy, serves as a platform for industry leaders to brainstorm solutions for global energy security and climate change. By participating in Gastech, NNPC Ltd aims to position Nigeria as a key player in the global LNG market while contributing to the global dialogue on sustainable energy futures.
The potential revival of the Brass and OK LNG projects is seen as a major step in Nigeria’s ongoing energy transition. Both projects have the capacity to significantly boost Nigeria’s LNG production and exports, positioning the country as a top-tier LNG exporter in the global market. Additionally, their successful execution would have far-reaching economic benefits, creating thousands of jobs, enhancing domestic power generation, and providing a steady revenue stream to support economic diversification efforts.
The renewed push for these LNG projects also aligns with Nigeria’s broader energy transition goals, particularly as the country seeks to reduce its reliance on oil and increase the role of natural gas in its energy mix. Natural gas, seen as a cleaner-burning alternative to coal and oil, is widely viewed as a transitional fuel that can help Nigeria meet its climate commitments while supporting industrialization and economic growth.
As NNPC Ltd continues its discussions with investors and partners, the outlook for Brass LNG and OK LNG appears increasingly optimistic. With favorable government policies, a clearer regulatory framework, and the support of President Tinubu’s administration, Nigeria is once again poised to become a global LNG powerhouse, unlocking new opportunities for growth and development in the years ahead.
Source: NNPC
