"Major Milestone": NNPC to Deliver 100m Cubic Feet of Gas Everyday to Dangote Refinery for 10 Years
- The NNPC has entered a milestone pact with Dangote Petroleum Refinery and Petrochemicals FZE for the supply of gas
- The agreement will ensure that Dangote Refinery is supplied 100 million standard cubic feet of gas every day for an initial ten-year period
- The NNPC said the pact aligns with FG's strategy to leverage Nigeria’s extensive gas resources to boost economic prosperity
Legit.ng journalist Victor Enengedi has over a decade's experience covering Energy, MSMEs, Technology and the stock market.
NNPC Gas Marketing Limited (NGML) has entered into a gas supply agreement with Dangote Petroleum Refinery and Petrochemicals FZE.
The agreement, signed by NGML’s managing director, Justin Ezeala, and Aliko Dangote, president and CEO of the Dangote Group, will facilitate the provision of natural gas for power and feedstock at the refinery.
Source: UGC
This gas sale and purchase agreement (GSPA), finalized at Dangote’s Lagos headquarters, commits NGML—a subsidiary of the Nigerian National Petroleum Company (NNPC) Limited—to supply around 100 million standard cubic feet of gas daily for ten years.
It would be recalled that Legit.ng earlier reported that the NGML and Axxela Limited inaugurated a 5km natural gas pipeline in Victoria Island, Lagos, which is expected to stretch 72.5 km to the Lekki metropolis.
NNPC, Dangote seal decade-long gas partnership
Olufemi Soneye, NNPC's chief corporate communications officer, stated that this major milestone aligns with President Bola Tinubu’s policy to harness Nigeria's vast gas resources to drive industrial growth and stimulate economic prosperity nationwide.
He noted that this initiative, involving a substantial investment without any capital expenditure (CAPEX) outlay, is seen by many as a groundbreaking achievement, unmatched in the history of NGML or any local gas distribution company (LDC) in Nigeria.
He said:
“Under the terms of the agreement, NGML will supply 100 million standard cubic feet per day (MMSCF/D), 50MMSCF/D being firm supply and the rest 50MMSCF/D interruptible natural gas supply to the refinery for an initial period of 10 years, with options for renewal and growth."
The NNPC spokesperson described the partnership as a major advancement in supporting the operational success of the Dangote Refinery and expanding Nigeria’s domestic gas usage.
Gas deal to power Nigeria's energy future
The statement noted that NNPC Ltd, through its gas marketing arm NGML, remains at the forefront of promoting domestic gas use to benefit industries and businesses nationwide.
According to Soneye, the agreement marks a key milestone for both companies, reflecting their shared dedication to strengthening local production and supplying essential resources for Nigerians.
He also highlighted that the deal underscores NGML’s commitment to excellence and NNPC Ltd’s mission to secure Nigeria’s energy future by implementing strategic gas initiatives nationwide.
In 2023, the NNPC secured a loan to acquire a 20% stake in the Dangote Refinery; however, after missing the payment deadline for the remaining balance, the stake was reduced to 7.2%.
FG tells NNPC to buy stakes in local refineries
In related news, Legit.ng reported that the federal government had recommended that the NNPC invest in local refineries rather than operating government-owned ones.
Heineken Lokpobiri, the minister of state for petroleum resources (oil), stated that the federal government intends to encourage the national oil firm to acquire shares in the planned and existing private refineries.
He said the government would encourage NNPC Ltd to adopt a new model allowing private investors to run the refineries optimally.
Proofread by Kola Muhammed, journalist and copyeditor at Legit.ng
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Source: Legit.ng
