Nigeria’s oil regulator has issued the first license for a floating liquefied natural gas (FLNG) plant to UTM Offshore Limited, which will utilise flared gas from ExxonMobil’s oil field in the Niger Delta.
As Africa looks to harness its gas potential, FLNG plants are becoming more common. Nigeria, with over 209 trillion cubic feet of gas reserves, loses over $1 billion in revenue each year from gas flaring, according to government data.
The 2.8 million tons per annum (MTPA) FLNG vessel will tap gas from ExxonMobil’s Oil Mining Lease 104 (Yoho field) located offshore in Akwa Ibom, in southern Nigeria.
The capacity of the plant has been expanded from 1.2 MTPA to 2.8 MTPA in response to increasing global demand for liquefied natural gas (LNG), according to Farouk Ahmed, who heads the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA).
UTM Offshore CEO Julius Rone confirmed that engineering work is slated for completion by 2028, with production expected to commence in the first quarter of 2029.
The project is currently in the engineering phase, with various factors at play, making it difficult to estimate the total cost, though it is confirmed to be a multibillion-dollar initiative.
The facility aims to supply 500,000 metric tons of liquefied petroleum gas to the domestic market, with liquefied natural gas earmarked for export.
Afreximbank has contributed $2.1 billion for the first phase and pledged an additional $3 billion for the second.
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