The Nigerian National Petroleum Corporation (NNPC) signed a gas development agreement (GDA) with Sterling Oil Exploration and Production Company (SEEPCO) for the execution of the oil exploitation lease on (OML) 143.
Malam Mele Kyari, chief executive of the NNPC group, revealed this in a statement by the group’s managing director, group’s public affairs division, Dr Kennie Obateru, in Abuja on Thursday.
He revealed that the project would increase the country’s gas production by 1.2 trillion cubic feet (tcf).
Kyari said the company’s gas marketing strategy is in line with the National Gas Expansion Program (NGEP).
He added that the project gas would be processed at the Ashtavinayak Hydrocarbon Limited (AHL) 125 million standard cubic feet (mmscf) gas per day gas plant located in Kwale, Delta State.
“This opens a gateway to other opportunities in the oil and gas industry, not only for the SEEPCO group but also for other companies.
“We are happy that this unlocks significant volumes of gas that will supply 125mmscfd to the Midstream plant you built.
“Of course, this is an important step for us and we are happy to do business with you. You are a very reliable partner because when you say things, you accomplish them, ”Kyari said.
SEEPCO Group Managing Director Tony Chukwueke said the GDA was the first agreement in Nigeria that completely separates gas development from oil production.
He said the arrangement would allow the holistic development of gas potential in the block.
He explained that the GDA was an important step because it was the first of its kind to expressly include conditions that encourage the entrepreneur to be efficient in his cost management.
“I would like to take this opportunity to thank the GMD, NNPC for their contribution in Nigeria and reaffirm that SEEPCO is determined to play its role in the energy industry in Nigeria,” he said.
The GDA is required, in accordance with the obligations of the Production Sharing Contract, to define the conditions for the development of the unassociated block of diesel of 1.2 tcf by SEEPCO which is the contractor with the NNPC as Concessionaire.
The additional gas supply from the project would increase the nation’s gas production profile, make dry gas available for the proposed 650-megawatt independent NNPC / SEEPCO power plant.
It will also boost the country’s supply of liquefied petroleum gas (LPG) and general use of domestic gas, increase energy security and create jobs for Nigerians.