Nigeria has finalized an agreement with Shell for gas supply, overcoming a significant obstacle in the realization of its $3.8 billion Brass methanol facility, as was announced by Ekperikpe Ekpo, the Minister of State for Gas on Thursday. The deal, which is crucial for the project’s progress, comes after extensive negotiations with Shell Nigeria’s CEO and other company executives.
Sponsored by Brass Fertiliser & Petrochemical Company Limited, the Brass methanol project is expected to reduce the country’s gas import dependency, bolster Nigeria’s economy and create up to 15,000 jobs during its construction phase.
The minister said the Gas Supply and Purchase Agreement (GSPA), pivotal to the Brass methanol endeavour, will be formally executed next month. This agreement will secure a sustained gas supply from a Shell-operated joint venture for the methanol production facility, which will be constructed on Brass Island in Bayelsa state, an area known for its oil wealth.
Ekpo highlighted President’s Bola Tinubu’s readiness to address concerns regarding the project’s gas supply and emphasized his eagerness for the project to commence. The project is expected to attract significant foreign direct investment and subsequent economic growth for the country.
“The President is very passionate about this project and wants something positive to happen before the end of May this year,” Ekpo stated.
Nigeria, boasting Africa’s largest natural gas reserves exceeding 200 trillion cubic feet, has struggled to leverage this resource due to financial limitations and infrastructural deficits.
The Brass methanol plant is currently under construction and is anticipated to launch operations this year. The comprehensive project entails the establishment of a gas processing plant, a methanol production and refining complex, and associated export infrastructure. Upon completion, it will have a daily production capacity of 10,000 tonnes of methanol.
Partners in this initiative include DSV Engineering Limited, the Nigerian National Petroleum Company Limited, and the Nigerian Content Development & Monitoring Board.