SPDC, NNPC sign gas supply agreement for $3.5bn Brass petrochemical project

The Shell Petroleum Development Company (SPDC) joint venture (JV) partners have signed a gas sale and purchase agreement (GSPA) for the $3.5 billion Brass fertiliser and petrochemical project in Bayelsa state.

The JV partners include SPDC, Nigerian National Petroleum Company (NNPC) Limited, TotalEnergies Ltd, and Eni.

According to a statement by the ministry of petroleum resources, the landmark agreement, supervised by Ekperikpe Ekpo, minister of state petroleum resources (gas), prepares the way for the Brass Fertilizer and Petrochemical Company Limited (BFPCL) and its partners to achieve financial close for the Brass Fertilizer and Methanol Project.

The ministry said the JV partners will supply 270 million standard cubic feet of gas daily (scfd) to BFPCL.

‘PROJECT TO GENERATE $1.5BN ANNUALLY FROM EXPORT OF FERTILIZERS’

Describing the BFPCL as the “largest single GSPA” to any domestic gas off-taker in Nigeria, the ministry said the project is expected to generate over “$1.5 billion annually from exports of fertilizers, petrochemicals, and other gas-based products”.

Ekpo, in his speech at the event, commended President Bola Tinubu’s unwavering support and guidance.

“Achieving this GSPA showcases Nigeria’s business-friendly environment and the government’s commitment to investor-friendly policies,” he said. 

The gas minister urged all parties to maintain their steadfastness. 

Ekpo said BFPCL and its partners are expected to achieve financial closure and commence construction soon to “bring in much needed Foreign Direct Investment (FDI) and create thousands of jobs for our teeming population, while changing the face and fortunes of the host Bayelsa State and community for good”.

On his part, Nicholas Agbo, permanent secretary, ministry of petroleum resources, described the GSPA as an important milestone in monetising Nigeria’s vast gas reserves, currently over 209 trillion cubic feet. 

“The project will reduce fertilizer imports by 30%, saving Nigeria approximately $200 million in foreign exchange annually, and contribute around $600 million annually to Nigeria’s GDP and create over 5,000 direct jobs and 35,000 indirect jobs significantly improving the livelihoods of many Nigerians, particularly in the Niger Delta region,” he said.

Ben Okoye, managing director of BFPCL, thanked Tinubu and Ekpo for their roles in finalising the GSPA.

Okoye emphasised the need to unlock Nigeria’s gas deposits swiftly, citing the urgency to utilise gas before it becomes less relevant.

Douye Diri, Bayelsa state governor, welcomed the project, highlighting its potential to generate employment opportunities for the state’s youths and Nigeria at large. 

Represented by Ebieri Jones, commissioner for trade, industry, and investment, Diri invited prospective investors to tap into Bayelsa’s vast potential and peaceful disposition.

On their part, the JV partners reaffirmed their dedication to the project’s success, underscoring the importance of collaboration and effective stakeholder engagement to unlock Nigeria’s vast gas potential.