The decision to invest $25 billion in the Nigeria-Morocco Gas Pipeline (NMGP) project, which is expected to deliver gas to 12 African countries and Europe, will be made next year, Bloomberg reported on Monday.
CEO of the Nigerian National Petroleum Company (NNPC) Mele Kyari told the outlet in an interview that negotiations about investments are underway.
“We will take a final investment decision next year,” he stressed.
However, he didn’t elaborate on which organizations were interested in financing the project.
Kyari estimated the project's final costs at about $20-25 billion, saying that the first phase of construction is expected to take around three years and the other ones are expected to last about five years.
The CEO further noted that the NNPC is ready to implement any gas pipeline project that exists on paper. In particular, he recalled the 4,000-kilometer Trans-Saharan gas pipeline project that would run through Nigeria, Niger, and Algeria.
“We have seen the opportunity to bring back every gas pipeline project that you can think of,” Kyari said. “It is a matter of who needs it and who’s ready to pay for it.”
Speaking of oil, Kyari estimated that Nigeria is ready to provide potential customers with an additional 500,000 barrels a day before the end of November if the Trans-Niger Pipeline and Forcados terminal are reopened.
The company's head also said that Nigeria has the biggest proven gas reserves in Africa, which he claimed to be at approximately 200 trillion cubic feet (about 5.5 trillion cubic meters). He stated that the Nigerian government seeks to rely more on gas, thus replacing crude oil as the country's main commodity.
The executive asserted that it is “very realizable" to quadruple gas production in the next four years. As of 2020, per Statista's latest available information, Nigeria is among the top three countries on the continent in terms of natural gas production, following Algeria and Egypt with 49.4 billion standard tons produced during the study period.
The NNPC reportedly wants to expand its activities, and for this purpose the company is ready both to build new gas-powered stations and buy the stations on sale within a privatization program.
Kyari claimed he is “creating the largest upstream company in the country and potentially in Africa.”
The 5,600-kilometer NMGP pipeline project was initially proposed in 2016 and officially kicked off in mid-September 2022.
The project is considered to be of great importance for both the population of Africa, 600 million of whom have no access to electricity, and Europe, which has been hit by an energy crises caused by its sanctions imposed on Russia as a response to the ongoing special military operation in Ukraine.
Thanks to the project, according to the creators' concept, Nigeria might not only increase its people’s living standards, but also give opportunities to other African countries along the pipeline route to monetize and export their gas.
17 September 2022, 11:48 GMT
Earlier, Kyari revealed that a four-kilometer illegal pipeline, operating for nine years, was discovered at the main Trans Escravos Pipeline. The illegal tapping reportedly led to the loss of hundreds of thousands of barrels of oil daily.
Nigeria has been facing the problem of its oil output declining steadily since 2020, slumping below 1.2 million barrels per day in August, per a CEIC Data analysis. Kyari argued that the theft and vandalism widespread along the pipelines had such an effect.
To alleviate the problem, in August, the NNPC reportedly hired private security contractors in order to protect the pipelines.