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NNPCL, Dangote Refinery Ink 10-Year Deal to Bolster Domestic Gas Supply

November 14, 2024

The Nigerian National Petroleum Company Limited (NNPCL), through its subsidiary NNPC Gas Marketing Limited (NGML), has signed a landmark Gas Sale and Purchase Agreement (GSPA) with Dangote Petroleum Refinery and Petrochemicals FZE.

The agreement, solidified on Tuesday by NGML Managing Director Justin Ezeala and Dangote Group President Aliko Dangote at the Dangote Corporate Head Office in Falomo, Lagos, is expected to significantly boost local gas production and utilization.

Under the terms of the agreement, NGML will supply 100 million standard cubic feet of natural gas per day (MMSCF/D) to the Dangote Refinery in Ibeju-Lekki, Lagos. The supply includes a firm 50 MMSCF/D with an additional 50 MMSCF/D as an interruptible supply for an initial 10-year period, with options for renewal.

“This major milestone aligns with President Bola Ahmed Tinubu’s commitment to leveraging Nigeria’s abundant gas resources for industrial revitalization and economic growth,” said Olufemi Soneye, Chief Corporate Communications Officer of NNPCL.

Notably, the partnership requires zero capital expenditure (CAPEX) from NGML or any local distribution company, making it an unprecedented investment in Nigeria’s gas industry.

The deal is expected to support the operational needs of the Dangote Refinery, utilizing domestic gas for power generation and feedstock, thereby advancing Nigeria’s energy security and industrial capability.

NGML’s gas distribution efforts, according to Soneye, demonstrate NNPC’s commitment to enhancing local production, energy independence, and the availability of essential products for Nigerians.

“This collaboration reaffirms our shared commitment to boosting local production,” Soneye said, adding that NGML’s strategy focuses on strengthening Nigeria’s gas infrastructure and fostering industrial growth across the country.

Written by Adeyemi Adewale




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