UTM Offshore Granted First Permit for Floating Gas Plant in Nigeria

AFRICAN BUSINESS AND ECONOMYSeptember 12, 2024 at 8:25 AM UTC

TLDR

UTM Offshore granted permit for first FNLG plant in Nigeria, operating in Akwa Ibom State.
Plant located on Yoho gas field managed by ExxonMobil, targeting both export and domestic gas production.
Production set to start in Q1 2029, aiming to export 2.8 million tonnes of LNG yearly while meeting 500,000 tonnes of domestic gas demand in Nigeria.

Nigeria's petroleum regulator has granted UTM Offshore the first permit to operate a floating natural gas liquefaction (FNLG) plant off the coast of Nigeria.

The plant will be located in Akwa Ibom State, operating on the Yoho gas field, which is managed by ExxonMobil and holds 2.2 trillion cubic feet of gas.

The floating liquefaction facility is expected to begin production in the first quarter of 2029 and will produce 2.8 million tonnes of liquefied natural gas (LNG) annually for export and 500,000 tonnes of domestic gas to meet Nigeria’s internal demand.

Key Takeaways

This project is a critical step in Nigeria’s efforts to reduce reliance on crude oil and monetize its vast gas reserves, estimated at 200 trillion cubic feet. UTM Offshore initially received a license in 2019 to build a smaller facility with a capacity of 1.2 million tonnes per year, but market demand for LNG led to the project's expansion. CEO Julius Rone did not specify the exact cost but described the project as a multi-billion-dollar venture. In 2021, Afreximbank committed $2.1 billion to finance the first phase of construction, with an additional $3 billion pledged for the second phase.

Economy

Gas

Nigeria

Oil and Gas

LNG

UTM Offshore