In a significant breakthrough for Nigeria’s Brass Fertilizer Petrochemical Company Limited (BFPCL), the long-awaited Gas Sales and Purchase Agreement (GSPA) with its gas supplier, the NNPC/SPDC Joint Venture (JV), is nearing conclusion, paving the way for the project’s financial close and commencement of the execution phase.
The GSPA is expected to be finalised before September 30, 2024, after years of delays, marking a major milestone in the project’s journey and setting the stage for a significant boost to Nigeria’s petrochemical industry, the Ministry of Petroleum Resources said on Tuesday.
This is as BFPCL and China Road and Bridge Corporation (CRBC) have executed Project Agreements for the $3.3billion Brass Industrial Park, Methanol Plant and Gas Gathering Pipelines with Associated Facilities, as well as signing a Shipping Vessels Acquisition and Joint Venture Agreement for 16 new 50,000MT methanol powered shipping vessels with COSCO Shipping Lines Co Ltd.
The Framework Agreement with COSCO will see the construction of 16 vessels, valued at about $900million, dedicated for the evacuation and transportation of methanol and other products from the Brass Methanol Plant to various global destinations. COSCO is one of the largest shipping companies in the world.
Minister of State Petroleum Resources (Gas), Ekperikpe Ekpo, who disclosed this on Tuesday also announced that Bohai Chemical Industries Group (BCIG) and China Africa Development Fund (CADFund) in collaboration with their Joint Venture (JV) partners have expressed their commitment to jointly invest in the Brass Methanol Project and facilitate immediately commencement of construction works.
Ekpo said these significant gains were courtesy of BFPCL’s strategic engagements with Chinese investors during the recent state visit of President Bola Ahmed Tinubu to China, which he participated in.
“During the visit, I held fruitful discussions with key stakeholders, including BCIG and CADFund, which have now expressed commitment to invest in the US$3.3 billion Brass Methanol Project in Bayelsa State,” said Ekpo.
“On this same project, I also want to state that we have expedited the completion of the Gas Sales and Purchase Agreement (GSPA) between BFPCL and Shell Petroleum Development Company (SPDC) Limited Joint Venture, a major breakthrough that paves the way for the project’s financial close and execution phase,” he added.
With the GSPA expected to be finalized before September 30, 2024, and financial close achieved before December 31, 2024, the Minister’s visit to China has set the stage for a significant boost to Nigeria’s petrochemical industry, demonstrating the government’s commitment to attracting investments and driving economic growth.
Ekpo also provided assurances to the Chinese investors regarding the protection and security of their investments, while also appealing to Nigerians to remain patient and confident in the government’s strategic initiatives aimed at revitalising the economy, driving job creation, and unlocking long-term prosperity.
According to him, President Tinubu has made it clear that investors’ interests are paramount, ensuring that their investments are safeguarded and guaranteed.
“Investors can enter and exit the market with confidence, knowing that their investments are protected and their rights respected. This commitment underscores our administration’s focus on job creation, economic growth, and sustainable development,” Ekpo said.
BCIG is a leading petrochemicals in the zero-carbon era, committed to building a new generation of neutral, open, and inclusive global information technology infrastructure platforms.
CADFund is China’s first equity fund focusing on investment in Africa, aiming at boosting Africa’s industrialisation process and enhancing Africa’s sustainable development capacity through investment.