Brass Liquefied Natural Gas (LNG) project in Bayelsa State, which was initiated about 15 years ago has reportedly robbed the country over $24 billion in estimated revenue and no fewer than 18, 000 jobs.

Going by the plan of the project sited over 606 hectares of land, shareholders, including NNPC, were expected to have taken the first Final Investment Decisions (FIDs) since 2007, and recoup their investment in the first five years by 2012.

NNPC Group General Manager, Group Public Affairs Division, Ndu Ughamadu, in a statement said if the project had been completed, the country would have produced additional 10 million metric tons of gas yearly, and also secure a brighter future in the international energy market.

Speaking at the House of Representatives Ad-hoc Committee investigating the expenditure and implementation of the $22 billion project, the Corporation’s General Manager, New LNG Venture, Ahmed Dikko, said the various stakeholders so far spent $1.2 billion to take the project to its current stage.

Dikko, who was quoted in in the statement as saying: “This sum included the cost of acquiring project land, which covers approximately 606 hectares, early works contract, Front End Engineering Design (FEED) and Pre-FEED Concept Evaluation Study (PFCES).”

It also covered Project Environmental Impact Assessment (EIA), comprising both onshore and offshore studies, dredging, EIA activities and ambient noise survey, displacement and settlement action plan (FED-RAP), cultural site heritage study, staff and administration project cost from inception, as well as sustainable development cost, among others.

Dikko explained that the project, which was conceived and designed to assist in monetizing the nation’s natural gas resources, reduce gas flaring and create jobs for the Niger Delta youths, was already at a critical point of FID before its major partner, Conoco Philips, pulled out.

He noted that as contained in the shareholders’ agreement, Conoco Philips, whose investment amounted to $192m received only $1 as entitlement.

He added, however, that Conoco Philips’ exit constituted a setback, insisting that the NNPC’s decision to work with the company to deliver the project was due to its readiness to provide requisite technology to drive the process.

Dikko assured that NNPC and the other shareholders had considered other simpler options to complete the project.

He maintained that the total estimated sum needed to complete the project was far from the amount being alleged, noting that NNPC deployed its negotiation capacity to get better value for the country.

“At inception, the cost of building the plant was estimated at $18 billion and not $22 billion, using Optimized Cascade Technology (A Conoco Philips LNG technology) of 2-train (10MTPA).

“However, this estimate was further reviewed downwards to about $16.5 billion CAPEX value in October, 2016 under project economics comparison carried out with PFCES of APCI Case Technology assumption,” he stated.

FPSO unit is a floating vessel used by the Offshore oil and gas industry for the production and processing of hydrocarbons for the storage of oil.

Erha FPSO has a liquid storage capacity of 2.2 million barrel, making it one of its biggest kind in the world. The Erha field and Erha North satellite field, was completed in 2006.

The fields are located approximately 97km offshore Nigeria in water depths ranging from 1,000m to 1,200m. They were developed with an investment of 3.5 billion dollars.

He said that it was not possible for a company like ExxonMobil to sell off its assets for the small amount quoted in the report as its assets were much more worth than that.

“I have confirmed that it is not true, there are going to be here for a long stay, they will be here over the next 50 years, they are looking for more, they are doing all kinds of things, they just begun the exploration campaign first time in four years because of the new cash call policies we put in place.

“ That is not a sign of somebody who is exiting. But different from not exiting is to be aggressive. ExxonMobil needs to be more aggressive in terms of development policies,’’ he said

He added that ExxonMobil need to be more aggressive with business as Bonga South west was almost on FID, Egina just kicked off and AGip is struggling to get Zabzaba online.

“ So, I need to see a very robust development ,’’ he advised

Commenting on the aim of his visit, he said that it was to encourage the company and see the development programmes as well as share in the challenges they were experiencing in their operations.

“First is to draw attention to the very complex and complication of operations of FPSOs when we do production off shore.

“This is about 100 km from Land, and part of the thing I am doing this month is visiting some of them. Including Egina that is just recently buoyed in different location and the one of Agip.

“I am here to look at what they are doing, to encourage them to continue the fantastic work they are doing and also discuss with them what their problems are,’’ he said

According to him, the visit is also to draw attention nationally and internationally to the few challenges in operations as complicated as this one.

He urged the company to brace up to the challenges in the sector as oil had recently been found in many African countries.

While addressing key business concerns of ExxonMobil Nigeria, Dr. Kachikwu in a statement, urged the operators to not only focus on the profitability of the firm but also on giving back to the society having been doing business around the country for a long time.

He commended the crew on behalf of the Federal Government of Nigeria for their sacrifice, urgency of attention and value addition while conveying President Muhammadu Buhari’s commitment to the welfare of those on the production fields.

Kachikwu referenced the community engagement drive of the organisation evidenced by the peace and harmony seen in operating areas.

The Executive Director and Production Manager of ExxonMobil Nigeria, Richard Laing, however debunked the rumour about the firm’s exit from Nigeria.

He further noted that the ERHA field is located in Oil Mining Lease (OML) 133, and ExxonMobil Nigeria holds a 56.25% participating interest while Shell Nigeria Exploration and Production Company (SNEPCO) holds the remaining 43.75% share.

The Floating, Production, Storage and Offloading (FPSO) has about 2.2 million barrels of storage capacity making it one of the largest of its kind, globally

However, there are a lot of positives. This is one area in the world where you have been able to develop and train people, we can operate at any level whether it is legal, financial, technical, we have had the skill set over many decades in Nigeria.

It is considered one of the main staples so any international oil company that is truly global, has operations in Nigeria. But if you look at where we are, compared to where we should be, we have quite a long way to go.

Would you say the country is delivering on its potential vis-à-vis the current production capacity?
Right now, we are below 2 million barrels per day (mbpd). We are probably about 1.7 mbpd but we should be at 4 mbpd given our base. Let’s even say the investments required to get us to 4 mbpd is quite substantial. At the very least, we should be at 2.5 million barrels per day.

In my opinion, the reason is that we have a lot of assets that are locked up. I used to be an investor in Wall Street and I put a lot of money in Nigeria at that time and this is one place that I know you have a lot of assets that have been proven but for one reason or the other, they are not available to local and international companies.
But if these assets are opened, do you think we really have the capacity to take them to production?
When you talk about capacity, you are looking at the industry broadly, so it is not only Nigerians that will do the work. There will be people from outside the country. It is always good to have a balance. As indigenous companies, we like the idea of the Nigerian Content Development and Monitoring Board (NCDMB) driving Nigerian ownership but at the end of the day, there’s also a value in diversity.

In an organisation, if we were all from the same background, our thought processes are the same, then we can miss things. We all grew up from what I like to call an unstructured background; it is also good to have people that grew up in a different background, where everything is structured. They may not necessarily be good entrepreneurs as we are, but they may be good at getting things done consistently. So, you need to mix those two to get the best.

Tim Okon, Technical Adviser to the Minister of State for Petroleum Resources, Emmanuel Ibe Kachikwu, at the inaugural meeting of the committee in Abuja, on Tuesday said they would ensure that policymakers have access to reliable data.

He said that access to consistent set of data would facilitate enlightened decision to take place for growth and development.

Okon added that the petroleum fiscal consistency network was driven by three federal ministries: Finance, Petroleum Resources as well as Budget and National Planning.

He added that the team would be working with a number of government agencies to ensure the collection and presentation of accurate fiscal data.

“It would involve the different entities that are involved in collecting information or collecting revenue as the case may be and making sure that there is a consistent basis for the data collected and presented.

“The agencies we are dealing with include collection agencies such as the Federal Inland Revenue Service (FIRS), Department of Petroleum Resources (DPR), the Nigerian National Petroleum Corporation (NNPC), and various other entities,” he said.

Okon further noted that the network would look at the manner of the workings of key sectors of the Nigerian economy and the way in which they were modeled fiscally, as well as the manner in which the results are presented to decision makers.

“The team would look at how consistently we gather information, analyse the information and how we present the result of the analyses to aid policy makers. That is the essence of the committee.”