Nigeria, Equatorial Guinea to jointly harness stranded gas resources

Nigeria and Equatorial Guinea have signed a Memorandum of Understanding to supply gas from Nigerian offshore fields to the neighbouring Equatorial Guinea Gas Processing Facility at Punta Europa.

While Nigeria has 206 trillion standard cubic feet of natural gas, infrastructure to turn the resource to economic benefit is elusive.

The pact is expected to unlock potential in the Gulf of Guinea wherein Nigeria’s abundant natural gas reserves compliments Equatorial Guinea’s Gas Processing and Liquefaction infrastructure.

Speaking at the ongoing Nigerian International Energy Summit in Abuja,

Minister of State for Petroleum Resources, Timipre Sylva, described the move as a way of meeting the imperatives of the “Decade of Gas” in Nigeria.

“Whilst we are focused on the domestic gas agenda, we are keeping an eye on the global gas market as well. Nigeria has huge gas resources, a significant amount of which is offshore and will require unprecedented investment in infrastructure to bring them to market,” Sylva said.

According to him, the collaboration will allow Nigeria’s stranded gas to access the global gas market within 18 to 24 months in what will be the fastest timeline to market for a Nigerian offshore gas asset.

He added that the development became feasible because Equatorial Guinea brought to the table a major portfolio of world class gas processing and liquefaction infrastructure already in place in Punta Europa, coupled with investment funds for development.

Also, Sylva said, the project, which envisions an offshore gas pipeline development, would create huge in-country local content opportunities for pipeline and other infrastructure service providers as well as accelerate royalty revenues that come from producing many gas fields that would have otherwise remained stranded.

Minister of Mines and Hydrocarbons of Equatorial Guinea, Gabriel Nguema Obiang Lima, who also spoke at the event, stated that the execution of the MOU was a great example of the South-South cooperation between neighbouring Nigeria and Equatorial Guinea.

“As the global geopolitics of natural gas evolves and within the context of the world transitioning to a lower carbon footprint, it is imperative that we think differently on how to remain an important player in energy markets. New, fast, and competitive sources will be a major determinant of success.

“This strategic collaboration breaks down geographical boundaries and allows delivery of gas from Nigeria to Equatorial Guinea’s Punta Europa facilities, extending their life and providing access to the regional and global energy markets. The NNPC and its JV partners get a unique opportunity to monetize gas that would have otherwise been stranded offshore due to absence of infrastructure,” he said.